Contrary to popular belief, simply checking your credit score will not cause your score to rise or drop.
There are a few reasons why many people believe this financial myth, but the confusion over how credit scores work actually shouldn’t cause anyone to panic.
There are two types of inquiries that can be used to determine your credit score, a hard pull or a soft pull. When you inquire about your own credit score, you are always conducting a soft pull of your credit information. Soft pulls also take place whenever an institution inquires about your credit score in a way that is pre-approved or promotional. Soft pulls can be done without your permission and are sometimes used by employers when they’re conducting a background check. Now, just because checking your own credit score won’t affect it doesn’t mean that credit checks are always harmless.
The second type of inquiry into your credit score is a hard pull. These inquiries are conducted whenever you apply for any kind of credit. This check involves a lender pulling your credit report and using it to determine the terms of a potential loan. Every time a lender conducts a hard pull, credit bureaus know that you are actively applying for new credit. It is these pulls that may lower your credit score by a few points. Each hard pull may stay on your credit report for up to two years, but they typically only affect your credit score for a year or less. Unless you’re applying for new credit on a regular basis, hard pulls shouldn’t have a significant effect on your credit score.
So, while hard pulls on your credit score may cause the score to drop a little, it’s your history of making timely payments that counts the most towards your credit score. This effect on your credit score isn’t a serious one, but you can take it as a warning to not excessively shop around for new credit. If you’re going to new lenders and asking for terms all the time, your credit score will reflect that. Of course, none of this is a concern when you conduct a soft pull, so don’t worry about checking your credit score as often as you’d like!