{"id":1558,"date":"2020-06-29T14:30:26","date_gmt":"2020-06-29T14:30:26","guid":{"rendered":"http:\/\/www.gccremit.com\/blog\/?p=1558"},"modified":"2020-06-29T14:30:29","modified_gmt":"2020-06-29T14:30:29","slug":"heres-why-multiple-credit-applications-affect-your-credit-score","status":"publish","type":"post","link":"https:\/\/www.gccremit.com\/blog\/heres-why-multiple-credit-applications-affect-your-credit-score\/","title":{"rendered":"Here\u2019s Why Multiple Credit Applications Affect Your Credit Score"},"content":{"rendered":"\n<p>You\u2019re in the market for a new, shiny credit card and you apply for a bunch of them that meet your requirements. A while later you find out your credit score has reduced drastically, despite your good repayment behavior and consistency.<\/p>\n\n\n\n<p>So how did this happen?<\/p>\n\n\n\n<p>First, you need to understand what happens when you send in multiple applications for a credit card, especially in a short period of time.<\/p>\n\n\n\n<p>With every new application you submit, the credit card issuer dives into your report to check your history, which either leads to an approval or a rejection. The issuer skims through your credit report to look for information like open accounts, repayment history, delinquencies, penalties, and the current balance you\u2019re carrying.<\/p>\n\n\n\n<p>Every time an issuer looks at your report, an inquiry is raised. This then reflects on your report to state that someone has peeked at your credit history.<\/p>\n\n\n\n<script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js\"><\/script>\n<!-- Links Ads- Horizontal -->\n<ins class=\"adsbygoogle\"\n     style=\"display:block\"\n     data-ad-client=\"ca-pub-0548205572604330\"\n     data-ad-slot=\"9920129301\"\n     data-ad-format=\"link\"\n     data-full-width-responsive=\"true\"><\/ins>\n<script>\n     (adsbygoogle = window.adsbygoogle || []).push({});\n<\/script>\n\n\n\n\n<p>However, you should know that are there are two types of inquiries\u2014soft and hard.<\/p>\n\n\n\n<ul><li>Soft inquiries: When you request for a copy of your own credit report, this is considered as a soft inquiry. You can pull this report as many times as you want and it won\u2019t affect your score. The reason your points aren\u2019t reduced with soft inquiries is because you\u2019re not looking for new credit; you\u2019re just displaying responsible credit management behaviour.<\/li><li>Hard inquiries: When banks or financial institutions ask for your credit report, this request is listed as a hard inquiry. This is because it means you\u2019re requesting for a new credit card and the lender wants to view your history. Now, if you have an incredible credit history with no penalties, this type of inquiry won\u2019t affect your score. However, if you have a poor history, you can expect an inquiry to knock off some points.<\/li><\/ul>\n\n\n\n<h4 class=\"wp-block-heading\">Why Will Multiple Credit Card Applications Reduce My Credit Score?<\/h4>\n\n\n\n<p>Not all hard inquiries are created equally. For example, you decide to apply for a home loan at 4 different financial institutions or banks within 5 days. You did this because you weren\u2019t sure which lender would give you the best rates. However, this will only count as one inquiry.<\/p>\n\n\n\n<p>Credit card applications, on the other hand, are far riskier. And there\u2019s good reason for this. Applying for several cards in a short span of time indicates that you\u2019re a riskier borrower. So for each application you submit, one inquiry is raised. And for every inquiry, a couple of points will be knocked off your credit score.<\/p>\n\n\n\n<p>Besides a drop in your score, the lender might also reject your application because of the other applications. You\u2019re either viewed as a desperate borrower or as someone who\u2019s risking their finances by signing up for too many credit accounts.<\/p>\n\n\n\n<p>A rejected application may also mean you\u2019re looked at as a churner. What this means is when someone gets credit cards just to earn the sign-up bonus. Some people even close and reapply for their old credit card to get the bonus again.<\/p>\n\n\n\n<script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js\"><\/script>\n<!-- Links Ads- Horizontal -->\n<ins class=\"adsbygoogle\"\n     style=\"display:block\"\n     data-ad-client=\"ca-pub-0548205572604330\"\n     data-ad-slot=\"9920129301\"\n     data-ad-format=\"link\"\n     data-full-width-responsive=\"true\"><\/ins>\n<script>\n     (adsbygoogle = window.adsbygoogle || []).push({});\n<\/script>\n\n\n\n\n<h4 class=\"wp-block-heading\">For How Long Will the Inquiries Reflect on My Credit Report?<\/h4>\n\n\n\n<p>Your credit report has all the information for the past 12 months. Which means, your credit inquiries made within these 12 months will show up on your report and will be used to calculate your score. Once this time period passes, your inquiries will be removed from your report completely. Now, this limit is only available for credit inquiries.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">How Do I Improve My Credit Score and Prevent it from Dropping Further?<\/h4>\n\n\n\n<p>Before you go on a credit card application spree, take a breather and do your research properly. Understand your requirements and then try to shortlist a card that meets them. Depending on your specific needs, this could either take some time or finish sooner than you expect.<\/p>\n\n\n\n<p>It\u2019s important to compare all the available options before hastily applying for credit cards. Not only does this affect your score immensely, but it also starts affecting your approval rate. When future lenders look at your report, they will categorise you as risky and you won\u2019t get a financial product when you absolutely need it.<\/p>\n\n\n\n<p>The second thing you can do is try to improve your existing credit report. For instance, if there are mentions of late repayments or some penalties, it would be good to follow consistency and ensure your dues are cleared on time.<\/p>\n\n\n\n<script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js\"><\/script>\n<!-- Links Ads- Horizontal -->\n<ins class=\"adsbygoogle\"\n     style=\"display:block\"\n     data-ad-client=\"ca-pub-0548205572604330\"\n     data-ad-slot=\"9920129301\"\n     data-ad-format=\"link\"\n     data-full-width-responsive=\"true\"><\/ins>\n<script>\n     (adsbygoogle = window.adsbygoogle || []).push({});\n<\/script>\n\n\n\n\n<p>The balances you hold from different accounts also affect your score. Plan your finances, see how much money you spare, and try reducing these balances to a minimum. For example, if the credit utilisation score on another credit card is at 50%, you must bring it to 30% or lower. Similarly, if other accounts have high balances, reduce them as much as you can.<\/p>\n\n\n\n<p>It is ideal to put a hold on your expenses during this period. Sure, that smartphone you want is calling out to you. But do you really need it? Avoid spending on things you don\u2019t require. This way, with the spare money, you can clear your bills quicker.<\/p>\n\n\n\n<p>Before applying for any card, you should also check if you\u2019re eligible for it. This is crucial because your application can rejected if you don\u2019t meet the basic requirements.<\/p>\n\n\n\n<p>And finally, submit just one credit card application at a time. When you\u2019re researching for the best card in the market, use\u00a0<strong><a href=\"https:\/\/www.bbazaar.my\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">comparison websites and tools<\/a><\/strong>\u00a0to make your search easier. Post application, wait to hear back from your lender. If your application is denied, wait for a while before you sign up for a new credit card.<\/p>\n\n\n\n<p>And voil\u00e0, soon you\u2019ll have a strong credit score and a great credit card as well!<\/p>\n\n\n\n<script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js\"><\/script>\n<ins class=\"adsbygoogle\"\n     style=\"display:block\"\n     data-ad-format=\"fluid\"\n     data-ad-layout-key=\"-ef+6k-30-ac+ty\"\n     data-ad-client=\"ca-pub-0548205572604330\"\n     data-ad-slot=\"9174788180\"><\/ins>\n<script>\n     (adsbygoogle = window.adsbygoogle || []).push({});\n<\/script>\n\n\n\n\n<script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js\"><\/script>\n<ins class=\"adsbygoogle\"\n     style=\"display:block\"\n     data-ad-format=\"autorelaxed\"\n     data-ad-client=\"ca-pub-0548205572604330\"\n     data-ad-slot=\"9687113448\"><\/ins>\n<script>\n     (adsbygoogle = window.adsbygoogle || []).push({});\n<\/script>\n","protected":false},"excerpt":{"rendered":"<p>You\u2019re in the market for a new, shiny credit card and you apply for a bunch of them that meet your requirements. A while later you find out your credit score has reduced drastically, despite your good repayment behavior and consistency. So how did this happen? First, you need to understand what happens when you send in multiple applications for a credit card, especially in a short period of time. With every new application you submit, the credit card issuer dives into your report to check your history, which either leads to an approval or a rejection. The issuer skims [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":1560,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[145,146,64,147],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Here\u2019s Why Multiple Credit Applications Affect Your Credit Score - GCC Remit Blog<\/title>\n<meta name=\"description\" content=\"First, you need to understand what happens when you send in multiple applications for a credit card, especially in a short period of time.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.gccremit.com\/blog\/heres-why-multiple-credit-applications-affect-your-credit-score\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Here\u2019s Why Multiple Credit Applications Affect Your Credit Score - 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