tl;dr: Your best course of action is probably to do a soft pull (check your own credit) and provide that to the lender for an unofficial pre-approval to get the ball rolling.
The long of it:
The loan officer is mostly correct, and I have recent personal evidence that corroborates that. A few months ago I looked into refinancing a mortgage on a rental property, and I allowed 3 different lenders to do a hard inquiry within 1 week of each other. I saw all 3 inquires appear on reports from each of the 3 credit bureaus (EQ/TU/EX), but it was only counted as a single inquiry in my score factors. But as you have suggested, this breaks down when you know that you won't be purchasing right away, because then you will have multiple hard inquiries at least a few months apart which could possibly have a (minor) negative impact on your score. However minor it is, you might as well try to avoid it if you can.
I have played around with the simulator on myfico.com, and have found inquiries to have the following effect on your credit score using the FICO Score 8 model:
- One or more inquiries from a single specific category (mortgage/auto/student loan) clustered around the same time window act like a single inquiry. Note there is another category called "Other" and multiple inquiries in this category do not collapse into a single inquiry like the specific categories do.
- Different specific categories count as another inquiry. If in a single month you had 3 mortgage inquires, 3 auto loan inquires, and 2 personal loan inquires, this would count as 4 total inquires. (1 for mortgage, 1 for auto, and 2 for "other".)
With one inquiry, your scores will adjust as such:
- Equifax and Transunion: -5 points for 3 months; no effect after 4 months.
- Experian: -10 points for 2 months; no effect after 3 months.
Two inquiries:
- Equifax and Transunion: -15 points for 3 months; -5 points for 4 through at least 6 months.
- Experian: -10 points for at least 6 months.
Three inquiries:
- Equifax: -25 points for 3 months. -15 points for 4 through at least 6 months
- Transunion: -15 points for at least 6 months
- Experian: -10 points for at least 6 months
Here's a helpful quote from the simulator notes: "Credit inquiries remain on your credit report for 2 years, but FICO Scores only consider credit inquiries from the past 12 months."
Of course, take that with a grain of salt, as myfico provides the following disclaimer:
The Simulator is provided for informational purposes only and should not be expected to provide accurate predictions in all situations. Consequently, we make no promise or guarantee with regard to the Simulator.
Having said all that, in your situation, if you know with certainty that you will not be purchasing right away, then I would recommend doing a soft pull to get your scores now (check your credit yourself), and see if the lender will use those numbers to estimate your pre-approval. One possible downside of this is the lender may not be able to give you an official pre-approval letter based on your soft pull. I wouldn't worry too much about that though since if you are suddenly ready to purchase you could just tell them to go ahead with the hard pull so they can furnish an official pre-approval letter.
Interesting Side Note: Last month I applied for a new mortgage and my score was about 40 points lower than it was 3 months ago. At first I thought this was due to my recent refinancing of property and the credit inquiries that came along with it, but then I noticed that one of my business credit cards had recently accrued a high balance. It just so happens that this particular business CC reports to my personal credit report (most likely in error but I never bothered to do anything about it). I immediately paid that CC off in full, and checked my credit 20 days later after it had reported, and my score shot back up by over 30 points. I called my lender and instructed them to re-pull my credit (hard inquiry), which they did, and this pushed me back up into the best mortgage rate category. Yes, I purposely requested another hard pull, but it shouldn't affect my score since it was within 45 days, and that maneuver will save me thousands in the long run.
