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New to Credit, Credit Score
Playfully glancing at your CIBIL score through a soft inquiry won't knock your credit score down. Keeping an eye on it regularly could amp up your chances of securing that loan approval!
Checking your CIBIL score regularly is a good habit you must have. Read on to know why.
Keeping tabs on your credit score regularly adds a fun twist to financial management! When you're well aware of your credit score, you're more likely to stay on top of it and even find ways to boost it. Plus, each time you peek at your score, it's just a soft inquiry, no biggie! This applies even when potential employers take a glance before hiring you.
But here's the scoop, some think that checking your score often might drag it down. Not true! In fact, avoiding regular checks means missing out on catching any sneaky errors or glitches that could drag your score down. So, let's turn up the fun and keep those credit scores sparkling!
What Is a Soft Inquiry?
A soft inquiry occurs when you or an authorized individual (often your employer or landlord) checks your credit score. Typically, soft inquiries are conducted for non-lending purposes and are less intrusive, having no impact on your creditworthiness.
Does checking your CIBIL score lower it? Nope! Soft inquiries don't influence your credit score, and they remain invisible to other lenders or creditors. In fact, regularly monitoring your credit score and keeping an eye on factors like payment history and new inquiries are commendable habits to cultivate.
Additional Read: Why should you check your credit report regularly?
What Is a Hard Inquiry?
When you apply for credit, like a credit card, auto loan, mortgage, or personal loan, a hard inquiry, also known as a hard pull, occurs. This involves the prospective lender assessing your credit score before approving your application.
Does checking your CIBIL score lead to a decrease? Hard inquiries are visible on your credit report and might temporarily lower your credit score. However, having numerous hard inquiries in a brief span might give the impression that you're seeking too much credit, which could negatively affect your credit score.
Soft Enquiry Vs Hard Enquiry. What Affects Your CIBIL Score More?
Hard inquiries hold considerable influence over your credit score, whereas soft inquiries don't affect your creditworthiness or lending decisions whatsoever.
These hard inquiries are laid bare for other lenders and creditors pursuing your credit report. If there's a flurry of credit inquiries within a brief timeframe, it can dent your credit score and raise doubts about your capacity to handle more credit responsibly.
It's wise to be mindful of hard inquiries and aim to keep them in check whenever feasible. Hence, periodically checking your credit score is crucial, and if you spot any inaccuracies, promptly report them to the relevant bureaus.
How Often Can You Check Your CIBIL Score?
Checking your credit score means finding out how creditworthy you are, which helps lenders determine if they should lend you money or approve your credit applications.
Here are a few reasons why checking your credit score regularly can be beneficial:
Monitoring for Errors: If you have the habit of checking your credit score regularly, you will be able to spot any errors or inaccuracies that might be negatively affecting your credit. You can report the errors to the respective bureaus and prevent potential damage to your creditworthiness.
Detection of theft or fraud: Monitoring your credit score periodically can help you detect signs of identity theft or fraudulent activity.
Analyze any significant drops or unexpected changes in your score
Analyze the credit inquiries listed on your credit report.
Check for any unfamiliar credit cards or loans listed in your name
Review your existing account for any unauthorized transactions, unfamiliar charges, etc
Check for inaccuracies in your address, phone number, or other personal information
Know your financial standing: Your credit score provides insights into your financial standing and creditworthiness. This information can come in handy when you are planning to apply for loans, mortgages, or other forms of credit.
In a breeze, we've grasped why our CIBIL score is so crucial. Picture it like solving a puzzle where you're boosting your financial know-how! So, let's keep it enjoyable and stay one step ahead with our CIBIL score to unlock all the awesome perks it holds.
Edited by: Ananya Gupta