Does Checking Your Credit Hurt It?

Checking your credit generates a record that appears on your credit report. The record appears at the bottom of the credit report and is visible to anyone who pulls the report. Checking your own credit score is referred to as a soft inquiry. Pre-approval marketing campaigns also make soft inquires to your record to determine eligibility. Despite generating a credit report inquiry, it is important for consumers to check their credit reports for accuracy.

Effect on Credit Score

The credit score remains unchanged during a soft inquiry. Consumers wishing to check their score multiple times a year can do so without affecting the score. Hard inquiries on the other hand affect the score slightly. A hard inquiry is triggered by a consumer when applying for a loan, credit card or life insurance. Hard inquiries account for less than 10 percent of the overall score. Multiple hard inquiries such as the ones by home lenders or car dealers which occur in a 14-day period are listed as just one inquiry on the report.

Recording Inquiries

Reviewing the number of times a consumer has applied for new credit gives lenders a sense of a consumer's financial health. Multiple inquires can indicate that a consumer is looking for a way out of an overwhelming debt situation. Applying for multiple cards or moving balances around can preclude a financial meltdown. Hard inquires not generated by the consumer could indicate identity theft and should be investigated. Unauthorized credit inquiries can be removed from the credit report at the consumer's request.

Who Performs Credit Checks

Credit card companies and other lenders perform soft inquires for pre-approved credit offers. Those with a specific business purpose such as home loan lenders, car dealers and landlords may perform hard inquiries with the consumer's permission. Inquiries appear only on the report being checked. I.e. a credit check on a TransUnion credit report will not show on a consumer's Experian credit report. Contacting the credit agencies to have your name removed from marketing distributions can reduce the number of soft inquiries on your credit report.

How Long Inquiry Remains

Soft inquires remain on the credit report for a year. Hard inquires will show up for two years. Credit reporting guidelines require all inquires to remain on the report for at least a year. Although hard inquiries stay on the report longer, most creditors tend to ignore any that are older than six months. After two years the record of inquiry will be removed from the report. It is important to note that few people are ever rejected for credit based on too many inquiries on their credit report.