The CIBIL score, a three-digit number, is an essential part of your financial journey. It is a numerical value that lenders widely use to assess your creditworthiness,
One of the most widely floating questions among individuals is, "Does checking the CIBIL score often affect it negatively?" Well, no! Read on to know more about the CIBIL score and factors that negatively affect this number.
How Does Checking CIBIL Score Affect CIBIL Score?
Every time your credit score is checked, it is reported in your credit information report.
Inquiries about your credit score are classified into two types: soft inquiries and hard inquiries. The type of credit inquiry is determined by who is looking at your credit report and why.
Soft inquiries do not affect your credit score, but hard inquiries can lower it.
Soft Inquiry and Its Impact
Soft credit checks, often known as soft inquiries, can happen for a number of reasons, including:
- when you check your own credit score (CIBIL score)
- when your employer or landlord checks your credit with your permission
Checking your credit score through a soft inquiry won't harm your credit score since you're not actually applying for credit. This means that it's perfectly fine to check your credit score prior to submitting an application for a mortgage loan, student loan, personal loan or credit card.
Soft queries do not have any impact on the CIBIL score.
Hard Inquiry and Its Impact
In order to approve loans and credit cards, lenders and credit card companies check your CIBIL score. This is called a hard inquiry.
Hard inquiries can temporarily lower a customer's CIBIL score by a few points.
In case a customer applies for multiple credit cards or loans in a short period of time, the hard inquiries conducted can cause significant damage to the customer’s CIBIL score.
This will lead to the rejection of the loan and the customer has to wait for a few months before applying for new credit.
How Do I Know Who is Checking My CIBIL Score?
You might be worried that someone checking your CIBIL score and that will lead to lowering your score. There is a way to find out who is checking your score.
When you request for a CIBIL report, you can see a list of organizations and people who have checked your score. The CIBIL report mentions all the people who have checked your score in the past year.
Importance of Checking Your CIBIL Score
As a credit user, it is important to understand how to check your credit score. Checking your CIBIL score regularly will help you understand what factors go into your credit score.
It's a common misconception that checking CIBIL scores will reduce points. As a result, most avoid checking their credit report and score frequently. This results in lower credit scores and a diminished sense of financial security.
It is crucial to regularly check your credit report and credit score to spot any possible errors and make sure your score is in line with your expectations.
How Often Should You Check Your CIBIL Score?
If you check your credit score yourself, it is considered a soft inquiry and will not harm your CIBIL score. Therefore, you can check your CIBIL score as often as you like.
In fact, it is a good idea to check your credit score regularly.
Checking your credit score before applying for credit cards or loans helps ensure that your applications are approved quickly and easily.
It is best to check your credit score a few months before applying for credit. This way, you will have enough time to review anything that may be negatively affecting your credit score and take the necessary steps to improve your CIBIL score.
FAQs
Checking your credit reports or credit scores will not impact credit scores. Regularly checking your credit reports and credit scores is a good way to ensure information is accurate.
Does frequently checking CIBIL score reduce points? ›
Checking your CIBIL score regularly does not reduce your credit points. You must check your credit score before seeking new credit as it will help you grow your credit score over time.
Do you lose points when you check your credit score? ›
Checking your credit score on your own, which is a soft credit check or inquiry, doesn't hurt your credit score. But when a creditor or lender runs a credit check, that's often a hard credit check, which could affect your credit score.
What are the disadvantages of checking CIBIL score? ›
There are higher chances of a drop in your score if you do not monitor it regularly. Your credit score can drop when a lender checks it - While your credit score is not affected when you check it, it can take a hit when multiple lenders check for it within a short span.
Will checking credit score reduce it? ›
Checking your own credit score is considered a soft inquiry and won't affect your credit scores. There are other types of soft inquiries that also don't affect your credit scores, and several types of hard inquiries that might.
Is it OK to check your credit score often? ›
Checking your credit report regularly—once a year at a minimum, but quarterly is preferable—can help you protect yourself and review where your credit accounts stand.
Is it true if you keep checking your credit score it goes down? ›
Checking your credit reports or credit scores will not impact credit scores. Regularly checking your credit reports and credit scores is a good way to ensure information is accurate. Hard inquiries in response to a credit application do impact credit scores.
Is 7 hard inquiries bad? ›
Since hard inquiries affect your credit score and what is found may even affect approval, you might be wondering: How many inquiries is too many? The answer differs from lender to lender, but most consider six total inquiries on a report at one time to be too many to gain approval for an additional credit card or loan.
Does checking credit score lower it in Canada? ›
Credit bureaus in Canada may collect different information about how you've used credit in the past. Requesting your own credit report has no effect on your credit score.
Is it bad to have two hard inquiries within 30 days? ›
Although a single hard inquiry might only hurt your credit scores a little, multiple hard inquiries could increase the impact. And an application can lead to a hard inquiry even if the creditor denies your application.
If you consider CIBIL scores, 750 is an excellent score to have. You can easily get any loan at good interest rates. If you further want to improve your CIBIL score, you can follow these steps consistently. The higher your credit score, the easier negotiation power you will have while taking loans.
How much CIBIL score will decrease for each inquiry? ›
How much does the CIBIL score decrease with each inquiry? A hard inquiry can lead to a drop of 0 to 5 points in your CIBIL score. But there's no need to stress by thinking whether or not your CIBIL score reduces every time you check it. It won't impact much, as this check is considered a soft inquiry.
How many times can I check my CIBIL score? ›
Before approaching banks, financial institutions, or even online lenders for a loan, borrowers must check their CIBIL score to understand their eligibility for their desired loan amount. As a borrower, there is no limit on the number of times you can check your CIBIL score.
Does checking your credit score lower your points? ›
No, checking your own credit score does not lower it.
Can I check my CIBIL score without affecting it? ›
When you check your own CIBIL score, it is considered a “soft inquiry” and does not leave a negative impact on your credit score. However, if a lender or a credit card issuer requests CIBIL to check your credit report (usually when they are considering you for a loan or credit card), it is counted as a “hard inquiry”.
Does checking CIBIL score on Google Pay reduce it? ›
Tip: If you check the credit score on Google Pay, it doesn't impact your credit score.
Why did my CIBIL score decrease without any reason? ›
Late or Missed Payments
If you have a habit of missing credit card payments or loan EMIs, it will reflect in your credit report and lower your CIBIL score. Even a single missed payment can cause the score to drop, so it is essential to make timely payments.
How frequently does your CIBIL score get recalculated? ›
This information includes your credit card usage, loan repayments, and any outstanding debts. The credit bureaus process this data to compute your updated credit score, keeping it current and relevant. Your CIBIL Score is updated every 30 to 45 days.
