Multiple Credit Applications: How Many Credit Inquiries Are Too Many?

How Many Credit Inquiries Are Too Many?

Applying for a credit card, home loan or personal loan generally includes the lender demanding a proof of your credit record to assess the risk. However, can shop around for the best credit card or loan with too many credit inquiries in a short time could it affect your credit?

There is no limit on how many times you can try applying for a credit or loan. Here is what you should to know before making applying several times.

What Is Credit Application

This is when you apply for any types or forms of credit such as:

tickMortgage

tickCredit card

tickCurrent account

tickOverdraft

tickPersonal loan

Your potential bank or lender will ask your consent to run a credit check as part of the application process.

When Should You Apply?

You should review your credit record initially and check whether its accurate before doing anything that can harm your credit standing. Some of the errors that you need to look into are as follows:

tickMissed payments on your credit accounts

tickWrong addresses linked to your name

tickCredit applications you haven’t made

tickPayments that aren’t recorded

tickDebts that are already paid yet inaccurately recorded

What Are The Information In My Credit Record:

The information in your credit report about your financial history comes from banks, credit card companies and building societies you have borrowed money from in the past or currently owe to. There will also be information from publicly available sources, from your mobile phone provider and others. Your report is likely to have to following information:

tickYour name, current address and other personal details

tickIf you are on the electoral roll at your present address

tickJoint financial products you currently hold (such as a current account)

tickHow much you currently owe to lenders

tickMissed payments on past or existing accounts

tickLate payments on past or existing credit card or unsecured loans / secured loans

tickIf you joined an Individual Voluntary Arrangement (IVA)

tickCounty Court Judgements (called “Decrees” in Scotland) filed against you, bankruptcies and home repossessions for six years after they occur

tickIf you have ever moved away while owing money

What Is A Credit Check?

It is when a lender obtains your credit record to review how you handle your finances. Each credit check is recorded on your credit report, whether you get accepted or rejected.

Every credit application you’ve made will be apparent to the next lender or creditor you apply. They can view if you’ve been rejected or approved before.

Lastly, if you make numerous applications over a short time, it could mean to lenders that you are desperate for loan or credit.