Why Too Many Credit Score Inquiries Can Hurt You |
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Utilizing too many credit score inquiries
can actually end up hurting your credit. Here are a few things to
consider about why credit score inquiries can actually lower your score.
Shopping for Rates
Whenever you access your credit too often, your score can be
negatively affected. However, the credit score formula allows for
individuals to access their credit several times within a short period
of time without hurting their score. This allows them to shop around
with multiple lenders whenever they are trying to find the best rate
for a loan. The damage on your credit score comes whenever you are
continually trying to access your score over a longer period of time.
Reasoning
The reason that this procedure can hurt your score is because
of the importance that the credit bureaus place on it. Whenever someone
is in financial trouble, they try to utilize every last ounce of credit
that they can get. They are trying to stay afloat financially when
things get bad. Therefore, if you try to access your credit score too
often, the credit bureaus are going to see this as a sign of financial
weakness. They will think that you are on the brink of getting into
deep financial trouble.
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