Does Checking Your Credit Score Impact Its Rating- Understanding the Truth Behind Credit Inquiry Effects

Does your credit rating go down when you check it? This is a common question among individuals who are looking to understand how their credit scores work and how often they can check their credit without negatively impacting them. The answer to this question is both straightforward and a bit nuanced, as it depends on the type of credit check being performed.

Firstly, it’s important to differentiate between two types of credit inquiries: soft inquiries and hard inquiries. Soft inquiries are those that do not affect your credit score. These can include when you check your own credit score, pre-approved credit offers, or when a lender checks your credit to determine if you qualify for a promotional offer. Since these inquiries are not visible to other creditors, they do not have any negative impact on your credit rating.

On the other hand, hard inquiries occur when you apply for new credit, such as a mortgage, car loan, or credit card. These inquiries can cause a small, temporary drop in your credit score, typically by a few points. This is because lenders view multiple hard inquiries within a short period of time as a sign that you may be credit-hungry or struggling to manage your finances, which can increase the risk associated with lending to you.

However, it’s important to note that checking your own credit score does not count as a hard inquiry and will not affect your credit rating. In fact, it is often recommended that you regularly check your credit score to monitor for errors or signs of identity theft. Most credit reporting agencies provide free access to your credit report and score, and checking it once a year is a good practice.

When it comes to the frequency of checking your credit score, there is no specific limit. However, if you are applying for multiple types of credit within a short period of time, it is advisable to space out your applications to avoid a significant drop in your credit score. Additionally, it is important to be mindful of the types of inquiries being performed and their potential impact on your credit rating.

In conclusion, your credit rating does not go down when you check it, as long as it is a soft inquiry. However, hard inquiries, which occur when you apply for new credit, can cause a temporary drop in your score. It is essential to understand the difference between the two types of inquiries and to manage your credit applications responsibly to maintain a healthy credit rating.