Your credit score is a three-digit number used by lenders and lenders to approve (and sometimes deny) your applications. All new applications, including new credit card applications, can affect your credit score.

What happens when you apply for a credit card

Credit card issuers look in your credit history to approve the application. The card issuer wants to know how you handled credit cards and other debts, the amount of bills you opened, whether you paid on time or had serious delinquencies, and the balance you carry through your credit cards and credits.

Your credit history is the best place to get this information.

Whenever a credit card company, for example, checks your credit report as a result of your application, your credit report will include a questionnaire to show that someone has verified your credit. Ten percent of your credit score is based on the number of queries in your credit history over the last 12 months.

How applications affect credit score

How applications affect credit score

Because new credit applications are 10% of your credit score, simple math shows that your credit score could drop as much as 70 points if you have 700 credits, for example. Fortunately, you are likely to lose so many points over a single credit card application because there is a lot more information in your credit score that will “absorb” the impact of one credit card application. However, making multiple applications in a short period of time can cost more.

The exact impact on your credit score depends on other information in your credit report.

Even if your credit score is not hurt by the additional queries, the card issuer may decline the credit card application simply because you have recently applied for several other cards. Too many new applications can be seen as desperate for credit, and despair is almost always off.

Or, it might indicate that you are taking on too many accounts in a short period of time, which could make it difficult to transfer any new monthly payments. Some credit card companies reject credit card owners who appear to be writing credit cards – this repeatedly opens credit cards to earn a sign-up bonus.

Whether your application is approved or rejected does not affect your credit score, not at least directly. If approved, opening a new credit card can cost you points in the “credit age” area as it reduces the average age of credit history. On the other hand, a rejection will not affect your credit score.

How long will the app be against you?

credit cards loan

The good news is that only credit debits in the last 12 months have been used to calculate your credit score. And after 24 months, the queries completely come off your credit report. This deadline only applies to credit issues. Other negative credit report information will stay on your credit report for longer.

Why apply for a credit card if it can hurt your credit?

Applying for a credit card can hurt your credit score in the short term, so you should avoid creating new applications if you are preparing for a big loan such as a mortgage or car loan, especially in the next 6 to 12 months.

As long as you are responsible with your credit card and your other financial accounts, your credit score can be withdrawn from any points lost by the new credit card application. And remember, while there is a chance that your credit score may be affected by a new credit card application, there is no guarantee that it will happen.