Credit inquiries come from a number of sources. An inquiry appears any time you apply for a new credit card, a car loan or a mortgage or even rent an apartment. Too many inquiries can lower your credit score, but they do fall off your credit report with time.
Significance
Inquiries are important because they hurt your credit score if you have multiple credit applications in a short period of time. Rate shopping, though, does not lower your score, as long as it's done in a short period of time. For example, going to multiple lenders for a quote on a single car loan won't harm your score as long as it's done within a 30-day window. Applying for multiple credit cards in the same period of time would negatively affect your score.
Time Frame
According to FICO, the company that compiles and create credit scores, inquiries stay on your credit report for two years, but they affect your score for only one year.
Neutral Inquiries
There are several types of credit inquiries that do not affect your credit score. One is a promotional inquiry, when a company wants to offer a solid, preapproved line of credit. Another is an account monitoring or account reporting inquiry, when an account that you already have reviews your overall credit. Internal inquiries, as when Equifax reviews an item you've disputed, also do not affect your credit score.
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