Whenever you apply for a new line of credit, a credit pull or a hard inquiry occurs. Each credit pull will show up on your credit report and it affects your credit rating and credit worthiness which makes it important that you understand how, why, and when they happen.
Every time you seek credit from a credit card issuer, they would want to see your credit worthiness by pulling your credit report. This would help them decide whether to grant you the new line of credit or not.
Hard inquiries can have a negative impact on your credit score in the short term. It will only have an impact for a few months, however, it will and can stay on your credit report for two years unless the necessary actions are taken.
Inquiries might have a bigger impact if you have few accounts or a short credit history. A large number of inquiries suggests a higher level of danger. According to some research, those who have six or more queries on their credit reports are up to eight times more likely to declare bankruptcy than those who have none.
Large number of inquiries often gives the credit card issuer the impression that you are desperately looking for funds as well. This decreases the chance of getting approved.
People with good credit scores usually keep their hard inquiries to a minimum. If you have more than the recommended number of hard inquiries on your credit report, it’s recommended to consult with a Credit Specialist to help you.