Credit inquiries can impact your credit score, but the effect varies significantly depending on whether the inquiry is "hard" or "soft," the number of inquiries, and your overall credit profile. Hard inquiries, which occur when you apply for credit (e.g., loans, credit cards, or mortgages), typically lower your score by a few points—usually fewer than 5 to 10 points—and remain on your credit report for two years, though they only influence your score for about one year ^[1][2]. Soft inquiries, such as checking your own credit or prequalification checks, do not affect your score at all ^[1][7]. The impact of hard inquiries is generally minor compared to other factors like payment history or credit utilization, which carry more weight in scoring models ^[2][9]. However, multiple hard inquiries in a short period can signal higher risk to lenders, potentially compounding the negative effect ^[4][8].

Key findings:

• Hard inquiries reduce scores by fewer than 5 to 10 points and remain on reports for 2 years but only affect scores for 1 year ^[1][2]
• Soft inquiries (e.g., self-checks, preapprovals) have no impact on scores ^[1][7]
• Multiple hard inquiries for the same type of loan (e.g., mortgages, auto loans) within a 14- to 45-day window are often counted as one inquiry ^[3][6]
• Credit inquiries account for only 10% of your FICO score, with payment history and utilization being far more influential ^[2]

Understanding Credit Inquiries and Their Impact

Hard Inquiries: When and How They Affect Your Score

Hard inquiries occur when a lender checks your credit report as part of a formal credit application, such as for a credit card, loan, or lease. These inquiries require your explicit consent and can negatively impact your credit score, though the effect is usually minimal. According to Experian, a single hard inquiry typically reduces a credit score by fewer than five points ^[1]. Bankrate notes that the impact can be slightly higher, up to 10 points, depending on the individual’s credit profile ^[2]. The reduction is temporary, as hard inquiries only influence your score for about one year, even though they remain visible on your credit report for two years ^[1][5].

The impact of hard inquiries is not uniform across all consumers. Those with excellent credit scores may experience little to no noticeable effect, while individuals with poor or limited credit histories might see a more significant drop ^[4]. This discrepancy occurs because lenders view multiple inquiries on a thin credit file as a higher risk. For example, someone with a short credit history applying for several credit cards in a short period may appear desperate for credit, raising red flags for lenders ^[8].

Key points about hard inquiries:

• Occur when applying for credit cards, loans, mortgages, or leases ^[1]
• Typically lower scores by fewer than 5 to 10 points ^[1][2]
• Remain on credit reports for 2 years but only affect scores for 1 year ^[5]
• Impact varies by credit profile; poorer scores may drop more significantly ^[4]
• Require consumer consent and cannot occur without permission ^[1]

Multiple Inquiries and Rate Shopping: Minimizing the Impact

When shopping for loans, particularly mortgages or auto loans, consumers often worry about the cumulative effect of multiple hard inquiries. However, credit scoring models like FICO and VantageScore account for rate shopping by treating multiple inquiries for the same type of loan as a single inquiry if they occur within a specific timeframe. For VantageScore, this window is 14 days, while FICO allows a 45-day period for certain loans, such as mortgages and auto loans ^[3][6]. This means that if you apply for a mortgage with three different lenders within 45 days, it will likely count as just one hard inquiry on your credit report.

This rule is designed to encourage consumers to shop around for the best loan terms without fear of damaging their credit scores. For example, the Consumer Financial Protection Bureau (CFPB) explains that mortgage lenders’ inquiries within a 45-day window are grouped together, allowing borrowers to compare offers without penalty ^[6]. Equifax similarly notes that multiple auto loan inquiries within a short period are treated as a single inquiry, minimizing the impact on scores ^[5].

Despite this safeguard, it’s still important to be strategic about credit applications. Applying for multiple types of credit (e.g., a credit card, auto loan, and personal loan) in a short time can lead to separate hard inquiries, each potentially lowering your score. Chase Bank advises that frequent inquiries across different credit types may signal financial distress to lenders, increasing perceived risk ^[4]. Credit Karma reinforces this, noting that while a single hard inquiry may have a negligible effect, several inquiries in quick succession can add up and harm your score ^[8].

Tips for minimizing the impact of multiple inquiries:

• Group loan applications (e.g., mortgages, auto loans) within a 14- to 45-day window to ensure they count as one inquiry ^[3][6]
• Avoid applying for multiple types of credit simultaneously, as each may trigger a separate hard inquiry ^[4]
• Use prequalification tools (soft inquiries) to compare loan offers before formally applying ^[7]
• Monitor your credit report for unauthorized inquiries, which can be disputed ^[1][8]