Can Checking My Credit Hurt My Score?
Have you ever wondered if checking your own credit report will affect your credit score and actually make your credit score go down? The answer is NO. Each consumer has the right to see their own consumer credit reports and can obtain them free once every 12 months at www.annualcreditreport.com.
Under the Fair Credit Reporting Act (FCRA) inquiries must report for two years, although the FICO™ scoring model will only calculate inquiries the first year reported, there are two types of inquiries that can be seen in your consumer credit reports in two separate sections, “soft inquiries” viewed only by you the consumer and “hard inquiries” viewed by you and other creditors/lenders. Creditors/lenders will only see the hard inquiries.
What is a Soft inquiry?
A soft inquiry is not included in your scoring with the FICO™ scoring model. Here are some examples of soft inquiries:
- You checked your own credit reports at www.annualcreditreport.com or at www.MyFICO.com.
- You have signed up for a credit monitoring service and they send you updates regarding your credit reports.
- You have an existing relationship with a creditor/lender and they checked your credit to offer you a promotion or increase your line of credit.
- You were shopping for insurance for your home or car.
- You were looking for an apartment and the application required a background/credit check.
- You were looking for employment and the application required a background/credit check.
- You receive a preapproved credit offer for a credit card and you did not respond to it.
What is a Hard inquiry?
A hard inquiry is included in your scoring with the FICO scoring model. These types of inquiries lower your credit score. Here are some examples of hard inquiries:
- You applied for a credit card on the internet, at the register, over the phone, or mailed in a paper application. (Each credit card inquiry can lower you FICO score approx. 5 points)
- You request a credit line increase and the creditor asks permission to pull a credit report – you say yes.
- You responded to a preapproved credit card application.
- You applied for a mortgage, auto, or education loan*.
- You applied for a personal or signature loan at a bank or credit union.
- You applied for a bank or credit union account. (Some banks or credit unions will pull a credit report to open a new account or to offer you a credit card tied to overdraft protection)
*The FICO™ scoring model allows for rate shopping for mortgage, auto, and education loans. The numerous inquiries created are treated differently than a credit card inquiry. Check out our blog, “Rate Shopping for Mortgage, Auto, or Education Loans.”
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