CREDIT

Mar 25 2020

Does checking credit karma affect score #Does #checking #credit #karma #affect #score



Does checking credit karma affect score

*******

Does Checking Your Credit Hurt Your Credit Score?

The first step in any credit-related goal is to get your credit score. Are you thinking of checking your credit, but worried it may hurt your credit score? If so, you’re not alone. The idea that checking your credit negatively affects your credit score is a common belief — but rest assured, it’s false. Read on to find out more about checking your credit and the impact it has on your credit score.

Does checking your credit score hurt your credit? Not always.

Do you know what your current credit score is? As we mentioned, the first step to any credit-related process is knowing and understanding your credit score. Checking your own credit score is safe, in that it doesn’t harm your score, but not all inquiries are the same. The fact that checking your own credit doesn’t hurt your score is great news, since research has shown that regularly monitoring your credit can help lead to a higher score.

In other words, not only will checking your credit not hurt your score, it can actually help you improve it. Improvements aside, let’s take a closer look at why understanding the process of checking your credit is so important.

Why is checking your credit score important?

Many of today’s consumers believe that checking their credit will have a negative impact on their score. As a result, a large number of consumers tend to avoid regular credit checks, meaning that many people may be missing errors or inaccuracies on their report — which can lead to a lower score. As such, it’s important for you to regularly check your credit to stay on track and make sure your score is where you’d like it to be.

Here are the biggest factors in inaccurate credit reports, broken down by credit ranking. As you can see, incorrect information impacts a number of consumers — even those who currently have a good credit score (33%).

Consumers who found inaccuracies on their credit reports

Credit Ranking Incorrect Information Lender Closed Accounts Old Debts Duplicate Accounts
Poor Credit Score 33% 34% 18% 15%
Fair Credit Score 29% 32% 31% 8%
Good Credit Score 33% 26% 22% 19%
Very Good Credit Score 1% 3% 1% 6%
Excellent Credit Score 0.5% 0% 0% 0%

Source: Credit Sesame surveyed 250 people, 50 had a poor credit ranking, 50 participants had a fair credit score, 50 members had a good credit rating, 50 people were listed as very good, and 50 members reported they had an excellent credit score. The study was conducted October 20, 2017 over a period of two weeks.

Understanding how to check your credit

When it comes to monitoring your credit, it’s important that you fully understand how to check your credit. To help with this, we’ve broken down some of the most common misunderstandings about how to check your credit, including what goes into your credit score, the difference between hard and soft inquiries, and more.

What’s in a credit score?

First things first, what exactly is your credit score, and how it is calculated? Your credit score is a numerical reflection of the information that is found in your credit report — or a representation of your ability to repay a debt as agreed. It can also show your use and responsibility with using credit.

In other words, it’s a simple number that carries a lot of weight.

There are many different versions of credit scores, with different scoring models and different types of scores, but almost all of them are based on the following factors:

Let’s take a closer look at just how much each of these factors can impact your score.

FICO Scoring Model Calculation (Weight) Factors

Credit Factors Credit Score Weight
Payment History 35%
Credit Utilization 30%
Credit Age 15%
Different Types of Credit 10%
Number of Inquiries 10%

Source: Data found September 26, 2018. Boeing Employees Credit Union website. Understanding Your FICO Score. Retrieved from https://www.becu.org/articles/understanding-your-fico-score

The only category above that could possibly be impacted by checking your credit score is account inquiries or new credit opened. As you’ll notice, the bulk of your credit score factors reflect more on your responsible use of credit — paying your bills on time, being responsible with the amount of credit you use, and being able to handle different types of credit (e.g., student loans and credit cards).

Related to ” Credit Score Check
Free Credit Score
What is a Good Credit Score
Free FICO Score
Credit Score Range
Credit Repair Companies
How to Increase Your Credit Score

Hard inquiries vs. soft inquiries

Did you know that there are different kinds of inquiries when it comes to checking your credit? Hard inquiries, also known as hard pulls, are the kind of inquiries that can cost you points on your score. This type of inquiry occurs when someone pulls your credit to make a decision about whether or not to extend credit (or even additional credit) to you.

Keep in mind that these types of inquiries should never happen without your consent, knowledge, or approval. If you see hard pulls on your credit report that you are not familiar with, contact the credit bureaus to make sure they are indeed something you requested. FICO, the originator of the most widely used and recognized credit scoring model, says that a hard inquiry may cost you up to 5 points using their system. VantageScore, FICO’s main competitor, takes hard inquiries more seriously — indicating that this type of pull could cost your score as much as 20 points.

By contrast, a soft inquiry or a soft pull is when you check your credit score, or when a lender is looking to pre-approve you for a loan or a credit card. These types of inquiries have no impact on your score.

So what’s the bottom line? Several hard inquiries at once, such as from applying for a number of credit cards at the same time, can have a significant impact on your credit score. And keep in mind that any hard inquiry will stay on your credit report for 2 full years — although any impact the inquiries have on your score will fade much sooner than that.

Here’s how those inquiries impact your credit score. WIth 4 hard inquiries in 90 days, you could expect your credit score to drop by more than 50 points. By contrast, the same number of soft inquiries doesn’t affect your score at all.

Average drop in Credit Score due to Inquiries

Change due to inquiry Average
Percent Drop
Hard Inquiries
Average Score Drop
Hard Inquiries
Average
Percent Drop
Soft Inquiries
Average Score Drop
Soft Inquiries
4 in 14 Days Source: Current Data provided by survey given to 625 members and non-members who over the course of the last 90 days had both hard and soft inquiries. Survey was done 3/1/2018 and 5/30/2018

Don’t let this stop you from shopping around when seeking a new car loan or a mortgage loan. If you have several hard pulls all for the same product, such as a car loan, within 14 days, they will all only count as one pull. This is to allow the consumer make a good financial decision without feeling pressured to go with the first lender they speak with.

Best practices for checking your credit score

When it comes to checking your credit score, here are a couple best practices that you should keep in mind:

We spoke to Credit Sesame member, Amanda, about how and why she checks her credit score, as well as what she would suggest for everyone else. Here’s her story:

Amanda checked her credit score and wants to help others

Member Since: 2/16/2018

We interviewed Amanda on June 10, 2018; She is 34 years old, is married with two young children, and is a homemaker in Tacoma, Washington.
What have you found the most helpful when checking your credit score?
My husband and I have been looking at buying a new house, especially now that the kids are getting a little older and we need more space. When we first applied for a mortgage, my credit score came back so bad, we couldn’t qualify. That is when I found Credit Sesame and my credit score was available every time I logged in. It is great because I don’t have to jump through any hoops, and if something is confusing, it is explained. They helped me get my score higher by clearing off two inaccuracies, and we are closing on the house tomorrow.
What would you recommend to someone who is new to checking their credit score?
First don’t let what happened to me to happen to you. Get on Credit Sesame and get your credit score. Once you have that, you can click through the different Credit Score factors. There is information about how to make your credit score better within each factor.

Benefits of learning about checking your score

We know you hear it over and over, but the truth bears repeating — your credit score and your credit health play a huge role in so many aspects of your life. Knowing how to correctly check your score will give you a regular and accurate snapshot of your credit health, which can help with everything from saving money on your credit cards to qualifying for a mortgage to purchase your dream home. Checking your score regularly is one of the most effective ways to stay on top of the necessary steps to maintain or even improve your credit.

So, does checking your credit score hurt your credit; it depends!

To recap, the most important takeaway here is that checking your credit does not hurt your credit score. There is a difference between hard and soft inquiries — hard inquiries happen when you apply for a new line of credit, and a soft inquiry is when you check your own credit. Soft inquiries don’t affect your credit score, but hard inquiries can lower your score from just a few points to sometimes many more.

Checking your credit is an important first step to maintaining good credit health. Checking your credit score regularly can be a good indication if something is off in your credit report. Before you apply for a loan for an expensive item, such as a car or a house, it’s smart for you to be aware of what potential lenders will see when processing your application. Knowing where you stand gives you the chance to shape up your credit, if necessary, before submitting your application.

*******



SOURCE: http://www.creditsesame.com/blog/credit-score/does-checking-your-credit-hurt-your-credit-score/

Written by admin