If You have ever thought every inquiry hurts Your Credit Score, I can tell you with certainty, this is False. For example, any inquiry in which You are pulling Your own Credit Report, will not affect Your Credit Score. It is technically not an “application for credit” and is therefore deemed a Soft Inquiry. Other examples of Soft Inquiries are when an Insurance Company or Credit Card Company looks at Your Credit Report to “check-in” and see how things are going for You. (They can legally do this by the way… it’s in the fine print). Any Inquiry in to Your Credit Report for the sake of an application to obtain a new loan or line of credit is called a Hard Inquiry. The Credit Scoring model looks specifically at the number of Hard Inquiries You have in the past 12 months. In my experience, if You have less than 4, there is no negative impact on Your Credit Score. If You have between 4-10 hard inquiries, there is a varying degree of negative impact. Beyond 10, the damage is already done and it’s difficult to cause any more damage from there. Since Inquiries make up 10% of the Credit Score, the affect could be as much as 85 points, though we usually see 50-60 points lost of Your number of Hard Inquiries in the last 12 months is above 10.
Avoid Hard Inquiries when possible, but don’t forget, there is no point in having good Credit if You don’t use it!