Does Checking My Credit Lower My Credit Score?
Checking your credit score won’t typically impact your credit scores, but when someone else checks your credit, a record of that credit check could remain on your credit reports for up to two years and may impact your credit score.
Knowing when and why credit checks occur could help you manage your credit, improve your credit score and ease concerns about monitoring your own credit or rate shopping before taking out a loan.
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Hard inquiries vs. soft inquiries: What’s the difference?
In the world of credit, a credit check is often referred to as an inquiry.
The Fair Credit Reporting Act (FCRA), the federal law that dictates when someone can check your credit and how long items can stay on your credit report, doesn’t distinguish between different types of inquiries.
However, the three consumer credit bureaus — Equifax, Experian and TransUnion — have policies to remove credit inquiries from your credit reports after two years, a year longer than the FCRA requires for most types of inquiries. They also split credit checks into two groups, hard and soft inquiries, which are also sometimes called hard and soft pulls.
What is a hard inquiry?
Hard inquiries are records of when a lender or creditor checks your credit before making a lending decision. Having hard inquiries on a credit report could hurt your credit score.
Whether it’s a new application or a request for a credit limit increase, many of the situations that can lead to a hard inquiry are the result of a creditor responding to an action you took.
A hard inquiry could get added to your credit report when:
- You apply for a new loan, a line of credit or credit card, and a business pulls your credit report.
- A business credit card application may also lead to an inquiry on your personal credit reports.
- You request a credit line increase on one of your accounts.
- You rent a vehicle and pay by debit card.
What is a soft inquiry?
A soft inquiry is also a record of when someone checks your credit report, but it generally occurs when the check isn’t part of a credit-making decision. A soft inquiry won’t impact your credit scores.
Although soft inquiries could occur after you take an action, some also take place without your knowledge. Soft inquiries can happen if:
- You check your own credit score.
- An employer checks your credit.
- A company or government checks your credit before granting you a professional license.
- An insurance company checks your credit.
- A business you already have an account with checks your credit.
- A lender offers you a rate quote or a pre-qualification.
Some actions could lead to a hard or soft inquiry
There are some cases when an action you take could lead to either a hard or soft inquiry, depending on the organization that’s checking your credit:
- You request a credit line increase on one of your accounts.
- You open a new checking, savings or money market account.
- You apply for a utility, cable, internet or mobile phone plan.
- You apply to rent a home.
You may want to ask the organization whether it will do a hard a hard or soft pull before you submit your application or request, and may want to hold off if there will be a hard pull.
Soft inquiries only appear on credit reports that you request
If you request a copy of one of your credit reports, you may see that the hard and soft inquiries are located in different sections of the report. The names of the sections can vary depending on the credit bureau and the service you use to check your credit.
For instance, the hard inquiries might be labeled hard inquiries, or they could be called credit inquiries, requests for your credit or regular inquiries. The soft inquiries might be under a section called soft inquiries, requests viewed only by you, promotional inquiries or a similar name.
Soft inquiries only show up on copies of your credit reports that you request. If someone else checks your credit with either a hard or soft pull, the credit bureau will send them a credit report that only lists hard inquiries from the last two years.
How credit inquiries affect your credit scores
A credit score is a risk score (often ranging from 300 to 850) that is generated based on the information in one of your credit reports. FICO and VantageScore create the most widely used third-party credit score, and both companies’ scoring models consider hard inquiries when calculating a consumer’s score.
Soft inquiries don’t affect your scores
Checking your own credit report or credit score won’t lower your credit score. Because soft inquiries only appear on copies of credit reports that consumers request for themselves, they will never have any impact on your credit score.
A creditor also won’t be able to see the soft inquiries on its copy of your credit report. Therefore, credit scores aside, it can’t consider the soft inquiries during its underwriting process at all.
A hard inquiry could hurt your scores
A single hard inquiry might not have any impact on your score, or it could lead to a small drop in your score. Multiple new inquiries during a short period are more likely to have a negative impact on your score, particularly if you’re new to credit.
However, FICO and VantageScore credit scoring models allow consumers to “rate shop,” and multiple inquiries for certain types of applications will only count as a single inquiry for scoring purposes.
An inquiry on one report won’t influence credit scores based on other reports
A credit score depends on the information in one of your credit reports, but it isn’t affected by your credit reports from the other two bureaus. Although major lenders often report your accounts and payments to all three credit bureaus, a creditor may only check one of your credit reports before making a lending decision.
As a result, a hard credit inquiry could show up on one of your reports, but not the others. When that’s the case, it will only potentially impact credit scores that are based on the report that has the inquiry.
A hard inquiry’s impact may decrease over time
Like other negative marks on your credit, a hard inquiry may have the greatest negative impact when it first shows up on your credit report. As long as you practice other good credit behaviors, such as paying your bills on time and only using a small portion of your available credit limits, a negative impact from a hard inquiry could decrease over time.
VantageScore shows the impact of an inquiry could drop to zero within just three months. In some cases, the inquiry could remain on your report and have no impact on your scores. For example, FICO’s credit scores don’t consider credit inquiries that are over 12 months old.
How multiple inquiries impact your credit
The impact of some hard inquiries may be negated depending on when and why they occurred, and the credit-scoring model being used.
Some credit-scoring models will ignore certain inquiries due to deduplication, or deduping. With FICO credit scores, multiple inquiries for auto loans, student loans, and mortgages are considered a single inquiry for credit-scoring purposes if the inquiries happened within a 45-day window (or, a 14-day window with some older FICO scoring models).
VantageScore does something similar with its credit scores, although it counts all inquiries within a 14-day window as a single inquiry.
FICO’s scoring models also won’t consider auto, student or mortgage loan inquiries that occurred within the last 30 days. The 30-day buffer can make it easier to shop for a loan without worrying about hurting your credit.
Do credit card inquiries hurt my credit score?
Often, if you apply for a new credit card, the application will lead to a hard inquiry when the credit card issuer will check your credit. A hard inquiry from a credit card application could hurt your credit and remain on your report, even if the card issuer denies your application, just like a hard inquiry from a different type of loan or credit line application.
What’s more, FICO does not dedupe or buffer out hard inquiries from credit card applications. Knowing this, you may want to hold off on applying for multiple credit cards at once.
How to dispute hard inquiries
If there’s an incorrect, outdated or unverifiable item on your credit report, you may be able to file a dispute with the credit bureau or the company that sent the information to the bureau and get it removed. Disputing items that are hurting your credit scores could be one way to quickly increase your scores.
When should you file a dispute?
There are a few circumstances when you may want to dispute a hard inquiry and have a good chance of getting it removed.
- If the hard inquiry is from over 24 months ago, it may no longer be timely and should possibly be removed from your credit reports.
- If a creditor checked your credit but you never gave it your verbal or written permission to do so, it may have violated the FCRA and the hard inquiry could be removed.
- If someone else applied for credit in your name, you can dispute the fraudulent hard inquiry as you didn’t authorize the credit check. Also, look for an associated account, dispute that account and contact the creditor to let it know that you’ve been the victim of fraud.
You can file a dispute with each of the credit bureaus online, by mail or over the phone. The dispute process with data furnishers can vary depending on the organization.
A dispute won’t always remove hard inquiries
A negative item will only be removed from your credit report if you file the dispute and the credit bureau or data furnisher finds that the item was indeed incorrect, outdated or the organization can’t verify the item.
Since an inquiry is a record of when someone checked your account, not when you opened a new account, a hard inquiry from a declined application isn’t an error and you may not be able to successfully dispute it.
You may also find multiple hard inquiries for an auto loan or mortgage on your reports if you recently applied for an auto loan or mortgage with a dealership or broker. It’s not uncommon for a dealer or broker to submit multiple applications for you in an attempt to find a loan with the lowest interest rate and best terms. These may be valid, and you don’t need to worry too much about these, as they’ll generally occur with the dedupe window.
In some cases, you may see a hard inquiry from a financial organization you don’t recognize, but that may not be an error either. The company you apply for credit might have a parent company, or a different associated company, that funds the account and checks applicants’ credit.
Minimizing the impact of hard inquiries
Understanding how and when an inquiry could hurt your credit can be important, and you can use this knowledge to limit potential negative impacts of hard inquiries.
Strategically shop for new credit
You can use the credit-scoring “rate shopping” windows to apply for student loans, auto loans or mortgages with multiple lenders without increasing the impact of the hard inquiries. This is often a good idea, as you can compare rates and terms, and determine which lender will give you the best offer.
Newer FICO scores will count multiple hard inquiries for these types of loans that occur within a 45-day window as one inquiry. Older FICO models, which are still used in the mortgage industry, dedupe inquiries that occurred within a 14-day window. VantageScore also uses a 14-day dedupe, which it applies to all inquiries.
One way to limit the number of hard inquiries in your credit reports is to only apply for new credit accounts or credit line increases when you really need them. You may also want to spread out applications, particularly credit card applications that may not be subject to the dedupe rules.
The bottom line: Don’t spend too much time worrying about inquiries
If you’re about to apply for a new loan or important credit account, you may want to do everything you can to increase your credit score. In those situations, minimizing the number of recent hard inquiries on your reports could help you get approved for a good rate and terms.
However, credit inquiries account for a very small portion of your credit score, and they usually won’t make or break your overall creditworthiness if you already have a good or excellent credit score.
It’s generally much more important to focus on paying your bills on time and only using a small portion of your available credit limits on credit cards and lines of credit. Even if you currently have poor credit, if you focus on these more important credit-scoring factors, you may be able to increase your score to the good to excellent range.