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Monday, April 16, 2012

Seven Ways You Can Hurt Your Credit Score

Here is an article from MSN that covers seven ways people will usually hurt their credit score.  Here is an excerpt from the article to give you an idea of what people typically do.
Opening too many accounts at once

Credit card new-account bonuses are certainly enticing, but you shouldn't be signing up for every card that's offering some cash back. Every application and subsequent credit review will generate a hard inquiry that will appear on your credit report. (Credit reviews that aren't used to decide whether you are actually getting a loan -- for instance, one conducted by a prospective landlord or by a bank when you are looking to get a checking account -- are considered soft inquiries and will have no impact on your score.)
Each hard inquiry will ding your score from three and five points and stay on your report for two years, although it will negatively impact your score only for about half the time it appears.
There is something in this article that isn't further expounded which is important for you to know regarding hard inquiries.  Hard inquiries that occur within two weeks while you are looking for a car or home as one hard inquiry instead of multiple ones.  This is called rate shopping and is something you should do.  Here are a few more answers from MyFico.


  1. This comment has been removed by the author.

  2. Only hard pulls affect credit score. They are recorded on credit file indicating riskier credit behavior. Each time hard credit report pull is made, it hits your credit score and causes its drop for 2-5 points. Hard pull is also performed once you fill out an application for mortgage, student auto loan or pre-approved to get a personal loan. For more info please see this post.

  3. Well I'd think it's obvious that opening a bunch of credit cards all at the same time is a bad idea, lol. You've just turned yourself into a giant risk if you do that!


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