05 May 2021

Can Inquiries Really Hurt Your Credit Score?

In the digital age, account hacking and identity theft are prevalent. If you aren’t monitoring your credit score already, you’re taking a risk. There are many people and institutions, such as banks, lenders, credit card companies, and employers, who will make credit inquiries on someone to find out about their creditworthiness.

It is important to note that there are some credit inquiries that will hurt your credit score, while there are some that won’t have any effect.

The question is,

How do you know which kinds of inquiries will hurt your score and which ones won’t affect it?

Let’s dive in and take a look!

Type of Credit Inquiries

Hard Inquiry

When you apply for a mortgage, auto loan, or credit card, the lender will have to make what is called a hard inquiry. A potential lender might check a number of credit reports to determine your creditworthiness.

A hard credit inquiry can reduce your credit score by up to five points and may remain on your credit report for up to two years. It is important to note that a hard inquiry will only affect your credit rating for the first year after the inquiry, however.

Once the two-year mark has come around, the hard inquiry will get pulled from your score. The one exception to this order of operations is when a lender has to check your credit to determine an interest rate and terms for you.

Soft Inquiries

Soft inquiries are those that aren’t connected to credit applications or loans. Whenever you check your credit to monitor what is happening, it is called a soft inquiry. The same thing happens when a landlord or employer checks your credit rating to decide whether or not you are a financially responsible person.

A soft inquiry won’t have any impact on your credit score, which is great news for people who want to monitor their scores. You can access your credit score at any time you’d like without having to worry about it impacting your score.

Can Inquiries Really Hurt Your Credit Score
Can Inquiries Really Hurt Your Credit Score
Can Inquiries Really Hurt Your Credit Score

How To Maintain a Good Credit Score

The most important thing when trying to maintain a good credit score is making sure that you’re debts are paid off in full and on time. Of course, sometimes things in life get thrown out of the left-field, including job loss, identity theft, or bankruptcy.

If these things have a negative impact on your credit, it can be difficult to get the financing you need to get back on your feet.

Luckily, there are methods out there to improve your credit quickly. Here at Boost Credit 101, we have a team of professionals that works with everyday people to improve credit scores using authorized user tradelines.

If you’re interested in learning more about how authorized user tradelines can help improve your credit score, make sure to get in touch with us. We look forward to helping you take the next step toward your financial goals.