Credit Inquiries: How They Affect Your Credit History
Before you qualify for a loan or a credit line from any source, the lender will be sure to check your credit history. When you receive "pre-approved" credit card offers in the mail, you can be sure that the company offering you the card has checked your credit first. If credit check s or inquiries are run too often on you, however, it can damage your credit history and limit your ability to borrow money or be charged a low interest rate.
Credit checks and inquires are done in two different ways, and only one of them actually affects your credit history. When you apply for mortgages, loans, or lines of credit and a credit check or inquiry is run because of your having applied, it will appear on your credit history.
Your credit score will get lower each time you apply for credit. Since credit inquiries can affect your credit score negatively, you should try to keep the number of credit applications you fill out to a minimum.
That does not mean that you shouldn't shop around for the best loan opportunity. Similar credit inquiries (like for a mortgage or auto loan) that are pulled within a particular time frame, around 30 days, will be counted as just one inquiry. Companies finally realized that shopping around was a good thing and they quit penalizing the smart consumer because of it.
The other credit inquiries are those made by business that you have not authorized to get your information. Anyone with a permissible purpose (defined by the Federal Fair Credit Reporting Act) has the ability to check your credit history ? without you even knowing about it.
Companies that have the legal authorization to run a credit check on you include retail stores and credit card companies. They want you to open credit lines with them, so they do credit inquiries in order to offer you preapproved cards. Even though these credit checks do not affect your credit history, they do appear so that you can find out who has been inquiring about your credit.
Another credit check that does not do any damage to your credit history is a check done by a prospective employer before they choose to hire you.
Any time a business pulls your credit history, it is marked on a report for you to view. These credit checks or credit inquiries can ultimately hurt your credit score, but only those credit inquires that you request will affect you in the end. - 16931
Credit checks and inquires are done in two different ways, and only one of them actually affects your credit history. When you apply for mortgages, loans, or lines of credit and a credit check or inquiry is run because of your having applied, it will appear on your credit history.
Your credit score will get lower each time you apply for credit. Since credit inquiries can affect your credit score negatively, you should try to keep the number of credit applications you fill out to a minimum.
That does not mean that you shouldn't shop around for the best loan opportunity. Similar credit inquiries (like for a mortgage or auto loan) that are pulled within a particular time frame, around 30 days, will be counted as just one inquiry. Companies finally realized that shopping around was a good thing and they quit penalizing the smart consumer because of it.
The other credit inquiries are those made by business that you have not authorized to get your information. Anyone with a permissible purpose (defined by the Federal Fair Credit Reporting Act) has the ability to check your credit history ? without you even knowing about it.
Companies that have the legal authorization to run a credit check on you include retail stores and credit card companies. They want you to open credit lines with them, so they do credit inquiries in order to offer you preapproved cards. Even though these credit checks do not affect your credit history, they do appear so that you can find out who has been inquiring about your credit.
Another credit check that does not do any damage to your credit history is a check done by a prospective employer before they choose to hire you.
Any time a business pulls your credit history, it is marked on a report for you to view. These credit checks or credit inquiries can ultimately hurt your credit score, but only those credit inquires that you request will affect you in the end. - 16931
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posted by Edgar at
00:50
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