The Impact of Credit Inquiries on Your Credit Score

“`html

How to Check Your Credit Report

Checking your credit report is a crucial step in managing your financial health. You can access your credit report for free at any time by signing up for a free Experian CreditWorks℠ Basic account. For more comprehensive monitoring, consider upgrading to a paid Experian CreditWorks℠ Premium account, which includes access to your TransUnion and Equifax credit reports along with additional benefits for credit protection.

Under federal law, you are entitled to check your credit reports from all three major credit bureaus (Experian, TransUnion, and Equifax) for free at AnnualCreditReport.com.

How Do Inquiries Impact My Credit Scores?

Inquiries, or requests to view your credit reports or scores, are categorized as either “hard” or “soft” inquiries based on their potential impact on your credit scores:

Soft Inquiry

A soft inquiry occurs when you check your own credit report or score, or when a monitoring service you authorize does so. These inquiries are noted on your credit report but do not affect your credit scores. Examples of soft inquiries include checks by lenders with whom you have existing accounts for account management purposes and credit checks by lenders for marketing credit products to you.

Hard Inquiry

A hard inquiry is added to your credit file when a lender requests your credit report or score for processing a credit application. This type of inquiry can impact your credit scores. Credit scoring systems like the FICO® Score☉ and VantageScore® typically lower your scores slightly in response to each hard inquiry. These reductions are usually minor (less than five points) and short-lived, with scores typically rebounding within a few months if you maintain timely debt payments.

Why Do Inquiries Have an Impact on Credit Scores?

Hard inquiries can concern lenders because they may indicate new debt that hasn’t yet appeared on your credit report. Credit scoring systems account for this uncertainty by deducting a few points from your scores. However, if you continue to make on-time payments on all your accounts, your scores will generally recover within a few months.

The Bottom Line

Regularly reviewing your credit reports is a smart practice to identify and correct inaccuracies and to monitor for unauthorized activity that could signal credit fraud or identity theft. Checking your own credit report will never harm your credit score. In fact, monitoring your Experian credit report can help you protect your credit and support long-term credit score improvement.

For any mortgage service needs, contact O1ne Mortgage at 213-732-3074. We are here to assist you with all your mortgage requirements.

“`