Thereâs no specific number of hard inquiries thatâs too many or too few. Although some hard inquiries might hurt your credit scores a little, credit scoring models also ignore many hard inquiries when consumers shop for a new loan.
Hard inquiries in your credit report might hurt your credit scores, but theres no specific rule for how many inquiries are too many. Depending on why the hard inquiries occurred and the type of credit score, some hard inquiries may not affect your score much at all.
Even when they do affect your scores, hard inquiries tend to be a minor scoring factor. Still, if you want to minimize the potential impact on your scores, its important to understand how, when and which hard inquiries will affect your scores.
If you want to get loans and credit cards with the best terms, you need to have a good credit score. But is it possible for your credit score to be too high? The short answer is no, there is no such thing as having too much credit score. But there are a few things you need to know to get the best score.
What Constitutes a High Credit Score
First let’s define what makes a credit score “high. ” Credit scores range from 300 to 850. Here are the general score ranges .
- 300-579: Poor
- 580-669: Fair
- 670-739: Good
- 740-799: Very Good
- 800-850: Exceptional
Scores of 740 and above are considered excellent. Once you’re over 760, you’ve reached the top tier and will qualify for the very best interest rates and terms from lenders.
So in short, the higher your score, the better. There’s no such thing as having too high of a credit score when it comes to getting approved for credit and loans.
Maximizing Your Credit Score
There is no such thing as a perfect credit score, but here are some things to keep in mind as you try to get the best one:
1. Be Strategic With Hard Inquiries
Whenever you apply for new credit, the lender performs a hard inquiry on your credit report. Too many hard inquiries in a short period can negatively impact your score.
As a rule of thumb, aim to keep hard inquiries below 5 in a 12-month period. Fortunately, FICO and VantageScore both have rules that minimize the impact of rate shopping. For example, multiple inquiries for an auto loan or mortgage within a 14-45 day window will count as a single inquiry.
2. Have Access to Credit, But Use it Wisely
As long as you use your extra credit wisely, there is no penalty for having too much of it. Credit scoring models don’t care how many accounts you have; they only look at how much you use your accounts and how well you pay your bills.
However, access to credit can lead to temptation. Be cautious about applying for credit cards or lines of credit you don’t really need. And avoid maxing out cards just because you have the available credit.
Maintain balances below 30% of your credit limit on each card. And pay your balances off in full each month to avoid interest charges.
3. Consistency Is Key
The most important factor in your credit score is your track record of on-time payments and responsible credit use. The longer you demonstrate this positive behavior, the higher your scores will climb.
Even someone with excellent credit can take a hit from a late payment or maxing out their credit cards. If you have great credit, don’t get complacent. Continue practicing good credit habits over the long term.
When a High Credit Score Isn’t Beneficial
There are a few niche scenarios where an exceptionally high credit score can work against you:
-
Credit card applications: Once your score reaches the top tier, a higher number won’t typically improve your approval odds or credit limits offered. At this point, additional hard inquiries from new applications may only ding your score a few points with no added benefit.
-
Mortgages: Some lenders charge higher interest rates to borrowers with excellent credit. Their models may see ultra-high scores as a sign you’re desperate for a loan and willing to pay more. Shop around for the best rates.
-
Auto insurance: Insurers may view an exceptionally high score as an indicator you’re obsessed with perfection. And perfectionists tend to file more claims for minor repairs. Your rates could be higher than those with a 740 vs. 850 score.
However, these scenarios are quite rare. In most cases, the marginal benefits continue to increase steadily alongside your credit score. Having an “excessive” credit score well above 800 will not work against you.
How to Recover From Credit Score Setbacks
No matter how high your credit score, setbacks happen. Here are some tips for recovering if your score takes a hit:
-
Get back on track with payments. Bring any past due accounts current ASAP.
-
Pay down balances. Reducing balances below 30% of your credit limit can provide a quick boost.
-
Hold off new applications. Wait 6-12 months before applying for more credit to allow inquiries to fall off your reports.
-
Dispute any errors. Identify and dispute inaccurate or fraudulent information dragging down your score.
-
Monitor your credit. Keep tabs on your score using a free platform like CreditWise® from Capital One.
-
Consider credit repair. Services like Lexington Law help remove negative items from your credit reports.
-
Give it time. The impact of score drops typically fades after a few months of positive behavior.
With diligence and patience, even someone with a perfect 850 score can bounce back from a late payment or two. Don’t get discouraged – focus on reestablishing responsible habits.
Is There Such a Thing As Too Much Credit Score?
The key is using credit wisely over the long haul. With a little discipline, you can achieve and maintain exceptional credit. Just don’t take a high score as an excuse to slack on payments or rack up excessive balances. Your credit score favors those who show consistency, not perfection.
VantageScore Credit Scores and Hard Inquiries
VantageScore takes a slightly different approach to hard inquiries:
- Counts inquiries from the previous 24 months: VantageScore credit scores can consider hard inquiries for the full two years that theyre in your credit report. However, hard inquiries still generally have a minor impact on your score that fades over the first few months.
- Deduplicates most hard inquiries: VantageScore credit scores deduplicate most hard inquiries that occur within a 14-day window, even if the hard inquiries are from different types of credit applications.
How to Avoid Too Many Hard Inquiries
You can avoid having too many hard inquiries that hurt your credit scores by understanding how credit scores treat hard inquiries and strategically applying for credit.
- Rate shop during a 14-day period. Try to group your applications when youre shopping for a new auto, home or private student loan (federal student loan applications dont lead to hard inquiries). Keeping the applications and resulting hard inquiries in a 14-day period could limit the impact on all your credit scores.
- Get preapproved for personal loans and credit cards. FICO® Scores dont deduplicate hard inquiries for personal loans and cards. However, some lenders and card issuers offer preapprovals, which can tell you if youll likely get approved with a soft credit checkâthe type that doesnt affect your credit scores.
Also, dont overthink the occasional hard inquiry. Building good credit is only helpful if you use it, and you shouldnt be afraid to apply for a new credit card with great benefits or take out an important loan.
Additionally, you can focus on the other, more important scoring factors. For example, paying your bills on time and decreasing your credit utilization ratio by paying down credit card balances could help your credit scores more than sporadic hard inquiries hurt them.
How long Hard Inquiry Stays on YOUR Credit Report (& how long a Hard Pull affects YOUR credit score)
FAQ
Is there too much available credit?
There’s no such thing as too much available credit when it comes to your credit score. The numbers show that people with great credit don’t use nearly as much of their credit cards as they should, which has helped their credit scores. However, having a lot of available credit could tempt you to spend more money.
Does having a lot of credit hurt your credit score?
With respect to available credit, having a lot of credit will not hurt your credit score. As we described above, having a high credit limit is great for your credit utilization ratio, which means it can be very beneficial to your score. However, this does not mean that having an abundance of available credit does not have any downsides.
Can having too many credit cards hurt your credit score?
It is true that having too many credit cards can begin to hurt your credit score, according to an article by credit expert John Ulzheimer. Fortunately, however, this is an issue that most people probably will not have to worry about.
Can a credit score be too high?
If your credit scores are already over 760 on the commonly used 300-850 scale, you’re getting the best rates and terms lenders offer. Ulzheimer questions how much effort you should invest in making them higher.
Do credit scoring formulas punish people for having too many credit accounts?
Credit scoring formulas do not penalize having too many credit accounts. However, having too much debt can negatively impact scores. (Note: This passage does not directly answer the question about credit scoring formulas punishing people for having too many credit accounts, but it is the closest and most accurate information provided in the passage. ).
Are high credit scores better than lower credit scores?
High scores are better than lower credit scores because they show lenders you are a reliable borrower. While higher scores are better, some ways of raising your credit score can cause more financial harm, such as opening new credit to improve your credit utilization ratio.
Is it possible to have too high of a credit score?
Keep in mind there are downsides to having the highest credit score possible. People with perfect credit may rely on credit too much and end up with more debt than they should.
Is a 900 credit score possible?
Is it possible to have too much credit?
If you apply for another credit card, having a lot of available credit that you don’t plan to use could hurt your chances, but that’s really the only bad thing that could happen. You don’t need to worry about having extra credit available as long as you don’t want to use it all up.
Is it possible to have a 400 credit score?
Your score falls within the range of scores, from 300 to 579, considered Very Poor. A 400 FICO® ScoreΘ is significantly below the average credit score. Many lenders choose not to do business with borrowers whose scores fall in the Very Poor range, on grounds they have unfavorable credit.