Credit scores: everyone knows their own, but how much do you know about WHY your score is the number it is? A wide range of factors can affect the amount on your credit score, including credit checks (or credit inquiries). Even though it is true that your credit score has the capacity to fall a little bit after some sorts of credit checks, analysts say that checking your own credit history will not have any impact on your score in any way.
Inquiries can be called as “soft” or “hard.” Whenever you apply for credit, every hard inquiry by lenders can diminish your credit score by a few points. On the other hand, when you are shopping around for a loan during a brief time span, it will only result in a single inquiry, thereby reducing the damage of having multiple credit checks. However, your credit score will not be affected by a soft inquiry. Unlike a hard inquiry, which occurs when you apply for credit, a soft inquiry happens when you get a copy of your own credit history.
Why can you check your own credit history as many times as you like without any effect? This is because when folk check their own credit scores they aren’t seen as looking for new credit. Instead, they are seen as showing responsibility, and good credit management skills. Other soft inquiries that will not alter your score include inquiries made by companies or banks that wish to pre-qualify you for certain marketing offers, inquiries made for employment reasons, inquiries made by an existing lender, or an inquiry made by insurance companies.
To lenders who look up your credit history, these soft inquiries won’t appear. They will only be included in the report that you see when you ask for it yourself. However, banks and other businesses will see records of hard inquiries on your credit history.
A hard inquiry will occur when you apply for credit and can possibly change your score. This is because it generally means that a person is looking to take on an additional debt, which can lead to credit risk in the eyes of a lender.
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