Will checking your credit score hurt it? This is a common question among individuals who are either planning to apply for a loan or simply want to keep an eye on their financial health. The answer to this question is not straightforward and depends on several factors. In this article, we will explore the different scenarios and provide you with the necessary information to make an informed decision.
Firstly, it is important to understand the difference between a hard inquiry and a soft inquiry. A hard inquiry occurs when a lender checks your credit score to evaluate your creditworthiness, typically when you apply for a loan, credit card, or mortgage. On the other hand, a soft inquiry is when you check your own credit score or when a company performs a pre-screened offer check, which does not affect your credit score.
Checking your own credit score, whether through a credit reporting agency or a financial institution, is considered a soft inquiry and will not hurt your credit score. In fact, it is recommended that you check your credit score regularly to monitor your financial health and identify any errors or discrepancies that may be affecting your score.
However, if you apply for multiple credit products within a short period, it may result in several hard inquiries on your credit report. This can temporarily lower your credit score, as lenders may perceive it as a sign of financial stress or a higher risk of default. It is important to space out your credit applications to minimize the impact on your credit score.
Another factor to consider is the frequency of hard inquiries. If you have multiple hard inquiries within a short time frame, it may have a more significant impact on your credit score compared to a single hard inquiry. This is because lenders may view you as a higher risk due to the increased likelihood of taking on more debt.
In conclusion, checking your credit score will not hurt it if it is a soft inquiry. However, applying for multiple credit products within a short period may result in hard inquiries, which can temporarily lower your credit score. It is important to be mindful of the frequency and timing of your credit applications to minimize the impact on your creditworthiness. Regularly monitoring your credit score can help you stay informed and take proactive steps to maintain a healthy credit profile.
