Do All Credit Checks Hurt My Credit?

If you check your credit scores regularly — and experts recommend you do — it can be a little scary to hear that credit inquiries can damage your credit. That’s a little like telling someone who is trying to improve their physical health that stepping up on the scale carries health risks. (And that’s not just because you might have a heart attack if you see that number.) There’s information that could be useful, but the consequences make you wonder if it’s worth it.

Some people think credit is like that. Why look if you think it could make a shaky credit score even lower? And if you think your credit is good, why risk shaving off a few points by checking?

It’s helpful to clarify what “checking credit” means, because in many cases it has no effect at all on your credit standing. If you request your own credit reports or scores, it has no effect on your scores. Similarly, if a potential employer who has your permission reviews your credit reports, it shouldn’t count against you. The fact that your credit was reviewed is recorded as an “inquiry” on your report, but employment-related inquiries are not supposed to be factored into your credit scores, and therefore are not supposed to affect them. (An exception that happened to one of our commenters was when an employment-related inquiry was misclassified as a credit inquiry.) This is another reason it’s worthwhile to check your free annual credit reports; a mistake could keep your score from being as high as it ought to be.

If you apply for credit, the lender or card issuer will typically check your credit score and/or credit report. That inquiry will affect your credit. But the damage to your credit is usually minimal — less than 10 points — and temporary. (Inquiries stay on your credit reports for two years, while most credit scoring models only include inquiries in the past 12 months). The inquiries that affect your scores are called “hard inquiries” as opposed to “soft inquiries,” which do not.

Soft inquiries that don’t affect your credit include those generated when:

You check your own credit
Your credit is evaluated for promotional offers
Your current lenders periodically review your credit
Insurance companies and/or employers review your credit information

Hard inquiries that can affect your credit include:

Applications for credit

So if you applied for several credit cards at once, then perhaps a car loan, you could see your scores go down some. However, you can check your own credit (a soft inquiry) every day if you want, and it would not hurt your perceived creditworthiness. You can also get two free scores, updated every 14 days, on Credit.com, and monitor your scores that way.