(Mobile, Ala.) Too many inquiries about your credit report can hinder your score, but inquiries that are pre-approved could hinder your ability to get loans when you actually need it.
Many have received pre-approved or screen loaned and credit cards in the mail, but each time one receives pre-approved credit, the company behind it has gathered information from one's credit report.
This is how it works: Credit card companies, banks, and loan agencies gain access to information about credit reports from a National Data Base. Companies then decide if people qualify for credit in which they did not apply.
"If you have a lot of inquiries in a short period of time, it looks like you are trying to take out a great deal of [money], borrow a lot of money very quickly. For a lender, that is a worrisome note," said University of South Alabama Finance Professor Russ Dickens.
While pre-approved inquiries cannot hinder one's credit score, Professor Dickens stated it could negatively affect one's chances of approval for loans or credit when it is needed.
"You could possibly be facing higher interest rates or even denial of a loan," Dickens said.
Checking your credit report is the best way to find out what company has looked at your information. The date and number of times the company checked the report will be posted.
To opt out of the national data base, call 1-888-5-OPT-OUT.
