Understanding the Impact- Does Checking Your Credit Score Really Lead to a Decrease-

Does credit score go down when you check it? This is a common question among individuals who are keen on maintaining a good credit history. The answer, however, is not straightforward and depends on the type of credit check being performed. In this article, we will explore the different types of credit checks and their impact on your credit score.

When you check your credit score, there are two types of inquiries that can be made: soft inquiries and hard inquiries. Soft inquiries, also known as soft pulls, do not affect your credit score. These inquiries are typically made when you check your own credit score, apply for a pre-approved credit card, or conduct a rate check. Since these inquiries are not visible to lenders, they do not impact your creditworthiness.

On the other hand, hard inquiries, also known as hard pulls, can have a negative impact on your credit score. These inquiries occur when you apply for new credit, such as a loan or a credit card. Lenders use hard inquiries to assess your creditworthiness and determine the risk associated with lending you money. Each hard inquiry can cause a small drop in your credit score, usually around 5-10 points, but this effect is typically temporary and should not be a cause for concern if you apply for credit infrequently.

It is important to note that the impact of a hard inquiry on your credit score is not permanent. Once the inquiry is removed from your credit report, your score should start to recover. However, if you have multiple hard inquiries within a short period of time, it may raise red flags for lenders and negatively impact your credit score more significantly.

Another factor to consider is the timing of your credit checks. If you have multiple hard inquiries within a short span of time, lenders may perceive it as a sign of financial distress or an attempt to open multiple lines of credit simultaneously. This can lead to a more substantial drop in your credit score. To minimize the impact of hard inquiries, it is advisable to space out your credit applications and avoid applying for multiple new lines of credit at once.

In conclusion, while checking your credit score does not directly cause it to go down, applying for new credit can lead to a temporary decrease in your score due to hard inquiries. To maintain a good credit score, it is important to be mindful of the number of hard inquiries you have and the timing of your credit applications. Regularly monitoring your credit score and maintaining a healthy credit mix can help you build and maintain a strong credit history.