If you’re applying for credit cards or shopping around for a good interest rate on a mortgage or auto loan, the lender may request a copy of your credit report to gauge their risk of lending to you.1 But can too many credit inquiries in a short time affect your credit?

How Credit Inquiries May Affect Your Score

For the most part, a credit inquiry has a small effect on a credit score — generally it lowers a score by about five points.1 In the case of auto loans, mortgages and student loans, if multiple inquiries are made in a short period of time, those inquiries are typically counted as one, minimizing their impact on your score.1

Credit inquiries remain on your credit report for two years, and studies have shown that people with six or more inquiries on their report are eight times more likely to default on their loans.2 Not everyone will be affected by a high number of credit inquiries in the same way, but it’s important to keep track of how many times you’ve applied for credit in the past two years to reduce the risk of your application being rejected.

Practicing Good Credit Habits

If you have an excellent credit score and pay your credit cards and loan payments on time, try waiting three months in between credit inquiries. Sometimes if a lender sees a bunch of inquiries at the same time, they understand that you are applying for a car loan or mortgage if they are all in one month.

If your application for credit is rejected, spend the next few months practicing good credit habits. Pay your bills in full and on time and pay down debt. All of these things could help to increase your credit score.2


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