Does a Credit Check Lower Your Credit Score?

People often wonder if it’s harmful to have your credit report pulled.  So, “does a credit check lower your credit score?”

Well, like all things in the credit score realm, it depends.  Sigh.  There are a number of different reasons to run a credit check, and thus the confusion.

Let’s knock out the easy ones first.  If you’re simply checking your own credit, via a free credit report website or via the FTC’s free credit report, your credit score will not go down.

These consumer credit reports allow you to see what’s up with your credit history, but pose no harm to you because you’re not actually seeking new credit, at least not right then and there.

Think about it, why would you be penalized just for checking your own credit report or score(s)?  That wouldn’t make any sense.

Related to that, you have a right to order a free credit report every 12 months from each of the three major credit bureaus (get a free credit report without a credit card).

Now suppose you already have a credit card open with a company and they want to keep tabs on you.

If they do a credit check just to see how things are going in your life, it won’t lower your credit score.

The same is true of companies researching your credit profile and subsequently sending you so-called pre-approved or pre-screened offers; it won’t hurt your credit score.

In all these instances, you did nothing to prompt the credit check, so you won’t be penalized in any way.

If you apply for a job and your potential employer orders a credit report, it won’t lower your credit score because no new credit is at stake.

They simply want to check out your financial background, so again, it won’t affect your credit score.

The only time your credit score could drop as the result of a credit check is when you apply for new credit.

Examples include applying for any type of loan, a new credit card, or an increased credit line with an existing card or loan.

These are the only instances when a credit check will lower your credit score, as new credit or inquiries for new credit pose new risks, regardless of how great of a borrower you’ve proven to be in the past.

Of course, the stronger your credit profile, the less impact these, dare I say, harmful credit checks will have on your credit score.

As a rule of thumb, the more credit inquiries you have in a short period of time, the more your score will drop, so exercise moderation.

Related Topics:

1. How Often to Check Your Credit Report?
2. Capital One Pre-Qualified Credit Card Engine
3. What Is a Bad Credit Score?
4. Lower Your Credit Card Interest Rate
5. Credit Inquiries