How Long Should You Wait Between Hard Inquiries?
Understanding the timing of hard inquiries is crucial for maintaining a healthy credit score. Hard inquiries occur when a lender checks your credit to assess your creditworthiness, and they can have a temporary negative impact on your score. So, how long should you wait between hard inquiries? This article will delve into the details and provide you with the information you need to make informed decisions about your credit.
Firstly, it’s important to note that hard inquiries stay on your credit report for two years, but their impact diminishes over time. However, the primary concern is the impact on your credit score during the first year. According to Experian, each hard inquiry can lower your score by up to five points.
When considering how long to wait between hard inquiries, it’s essential to assess your credit goals. If you’re aiming to maintain a high credit score, it’s best to space out hard inquiries by at least a few months. This gives your score time to recover from any potential damage caused by the inquiries.
However, if you have a good credit score and are actively shopping for loans or credit cards, it’s possible to have multiple hard inquiries within a short period without significant damage. The key is to ensure that these inquiries are related to the same type of credit, such as auto loans or mortgages, and that you’re not applying for multiple lines of credit simultaneously.
For instance, if you’re shopping for a mortgage, you can have multiple inquiries from different lenders within a 14-day window without the inquiries being counted separately. This is known as the “rate shopping” period. This allows you to compare rates and find the best deal without worrying about the impact on your credit score.
On the other hand, if you’re applying for multiple credit cards within a short period, it’s best to space out the applications by at least a few weeks. Multiple credit card applications can be perceived as a higher risk, which may result in a more significant impact on your credit score.
In conclusion, the ideal waiting period between hard inquiries depends on your credit goals and the type of credit you’re applying for. As a general rule, aim to space out hard inquiries by a few months to maintain a high credit score. However, if you’re shopping for the same type of credit within a short period, take advantage of the rate shopping period to compare rates without worrying about the impact on your credit score.
Remember, managing your credit responsibly is key to maintaining a good credit score. By understanding the timing of hard inquiries and their impact on your credit, you can make informed decisions and keep your financial future on track.
