Hard Inquiry: Effect on Your Score

Why it matters

Hard inquiries are listed on your credit report. They can slightly lower your credit scores for a limited time — usually a matter of months. Most scoring models stop counting them after about a year, and they drop off the report after about two years. Because each application can add an inquiry, opening several new accounts in a short span may have a bigger combined effect. Most scoring models treat a burst of inquiries for the same purpose as a single inquiry — like rate-shopping for one mortgage or auto loan within a short window. If a hard inquiry shows up that you didn't authorize, it can be a sign of identity theft, and you can dispute it.

Example

Jordan applies for a car loan and three credit cards in the same week. The car-loan shopping he does at several dealers within a few days counts as one inquiry. But each separate card application adds its own hard inquiry. His scores dip modestly for a while, then recover as the inquiries age. Months later, he spots an inquiry from a lender he never contacted, and disputes it as possible fraud.