The Difference Between Soft and Hard Inquiries
Soft Inquiries Don't Affect Your Score
Hard Inquiries Can Lower Your Score
When Is It Helpful to Check Your Credit?
- If your score is very low, checking often will let you track improvements as you pay down debts.
- If you’re new to credit, keep an eye on your score as you build history for the first time.
- If you already have an exceptionally high rating, make sure it doesn’t drop unexpectedly.
The Impact of Hard Inquiries
When New Credit Seems Like the Only Option
For those already struggling with poor credit, it can be tempting to open up new credit cards or take out loans to make ends meet. However, this will only lead you deeper down the road to debt. If you already have debt that is weighing on you, it’s better to address it now before it snowballs. The short-term relief of more credit never outweighs the long-term harm to your finances.
Consider Impact on Credit Before Taking on More Debt
Before taking on more debt, consider option like Debt settlement that could resolve what you already owe. While new credit may provide short-term relief, the damage to your credit score can hinder your finances for years to come. Always weigh the long-term impacts before assuming more debt, no matter how desperate the situation may seem.
Checking your credit score frequently is not necessarily harmful, as long as you are making soft inquiries that don’t impact your rating. However, blindly applying for new lines of credit without considering the consequences can lead to a downward spiral of hard inquiries, score drops, and burdensome debt.