Does checking your credit affect your score?
Checking your credit can be a confusing topic for many individuals. One of the most common questions that arise is whether or not checking your credit can impact your credit score. In this article, we will explore this question and provide you with a clear understanding of how credit inquiries work and how they can affect your credit score.
Understanding Credit Inquiries
A credit inquiry, also known as a credit check, occurs when a lender or financial institution checks your credit report to assess your creditworthiness. There are two types of credit inquiries: hard inquiries and soft inquiries.
A hard inquiry is made when you apply for a loan, credit card, or any other form of credit. This type of inquiry can have a temporary negative impact on your credit score. On the other hand, a soft inquiry is made when you check your own credit score or when a lender pre-approves you for a credit offer. Soft inquiries do not affect your credit score.
Impact of Hard Inquiries on Credit Score
When a hard inquiry is made, it can cause a slight drop in your credit score. However, the impact is usually minimal and temporary. Credit scoring models typically consider the following factors when evaluating the impact of a hard inquiry:
1. The number of recent hard inquiries: If you have multiple hard inquiries within a short period of time, it may raise red flags to lenders, as it could indicate that you are credit hungry or experiencing financial difficulties.
2. The age of your credit accounts: A longer credit history can help offset the negative impact of a hard inquiry.
3. The types of credit accounts: A mix of credit accounts, such as credit cards, loans, and mortgages, can positively influence your credit score.
Frequency of Checking Your Credit
It is important to note that checking your own credit score does not affect your credit score. You can check your credit score as often as you like without any negative consequences. In fact, regularly monitoring your credit score can help you stay informed about your financial health and identify any potential issues early on.
Conclusion
In conclusion, checking your credit can have a minimal and temporary impact on your credit score if a hard inquiry is made. However, checking your own credit score or being pre-approved for a credit offer does not affect your credit score. It is essential to understand the difference between hard and soft inquiries and to monitor your credit regularly to maintain a healthy credit score.
