Q: How long does a credit inquiry stay on my credit report?
A: Whenever a lender is authorized to pull your credit report, a credit inquiry is done. How long that remains on your credit record depends on the type of inquiry…
For hard inquiries
Called hard pulls, these are credit inquiries initiated by you. The good news is that they can only affect your FICO for a maximum of 12 months (if they have any impact at all). If there is an impact it’s primarily during the first 6 months, so it’s probably nothing to worry about as long as you aren’t getting a mortgage during that time.With Experian, hard inquiries will drop off your credit report at the end of the month following two years. With TransUnion and Equifax the hard inquiries will fall off exactly two years later. For soft inquiries Also known as a soft pull, this refers to an involuntary credit check that was not initiated by you. Things like pre approved credit card offers and account reviews use soft credit inquiries. They typically stay on your credit report for at least one full year.
How much will they affect your credit score?
Instead of asking how long credit inquiries stay on your credit report, you really should be more concerned with how long they impact your credit score? With soft inquiries there is no impact to your credit score, so they are not something to worry about. On the other hand, hard inquiries will impact your credit score – the exact amount of impact depends on a number of factors (which are not all public because the FICO formula is secret, but they have said there may be a greater impact for those with shorter credit histories and few accounts). It is often presumed that the higher your score is to start, the more of an impact a hard credit check will have. Although the hard inquiries remain on your credit report for two years, they have the most impact during the first six months. After a year has passed an inquiry will no longer be counted in the credit score, but it will still be visible to those who view your report.
Why do credit inquiries lower score?
According to FICO, there is a direct correlation between credit risk and the number of inquiries a person has. They state that those with 6+ hard credit inquiries on their report are up to 8x more likely to file bankruptcy than someone with zero credit inquiries. Personally, I feel it is unfair that credit inquiries for things like utilities or a savings account can hurt us, but sometimes we have no choice but to take the hit.
When is it safe to apply for your next card?
Remember that a hard inquiry only counts against your score for 12 months and during that time, it has the most impact during the first 6 months. So unless you need to apply for a mortgage or major loan within the next 7-8 months, I wouldn’t worry too much about getting another inquiry right now. And remember in the long run, the more credit accounts you have, usually the best your score will be (assuming you manage them responsibility). I reached a high 790 FICO with nothing but credit card accounts (around 10) by my early twenties. Obviously that took a lot of inquiries, but in the long run it was worth it and helped me achieve such a high score.
This post was written or last updated November 25, 2013