It is impossible to avoid a hard credit check if you apply for any loan. But, with sound financial management, you can minimize the impact on your credit score.
Below are ways to avoid a massive impact from hard credit pulls.
Know your capabilities
Understanding your financial capabilities helps you make better decisions. One such decision is knowing when to apply for a loan.
Check your credit score and report before applying for a loan. The process is free and will give you an idea of what to expect.
If your score is low, it is not recommended to ask for a loan. That will lead to a hard pull and a hard rejection. It is a poor financial decision.
Learn how to make better financial decisions and avoid unnecessary hard inquiries on your report.
Another good financial behavior is avoiding applying for credit cards within a short time. Applying for credit cards in a short time increases the number of hard inquiries on your report.
When you do not qualify for a credit card, the situation is even dire.
Rate Shopping
It is normal to check your interest rates with your lender before looking for a house or item to buy. These checks will result in a hard credit check in your report.
However, the good news is that some lenders provide a prequalification process that gives you interest without a hard check.
Additionally, you can take advantage of mass rate shopping. What does it mean? Mass rate shopping is when you rate shop for loans and mortgages within a short time.
Mass rate shopping compiles all the hard credit checks within that period as one on your credit report.
Various scoring models are used, with some giving you a rate-shopping period of 14 days and others 45 days. It is safer to do all your rate shopping within two weeks.
Custom Credit Cards
Some credit lenders offer individuals credit cards irrespective of their credit scores. These unique credit cards will work even if you have many hard pulls in your credit report.
However, carefully consider the terms and conditions before agreeing to such situations. The terms and conditions for such arrangements may put you in more financial trouble.
The best way is to avoid such credit cards at all costs.
Have your Credit Repaired for Better Financial Freedom
Credit inquiries are unavoidable but should not give you any stress. They are procedural and will not have a huge impact on you if you have a good credit history.
In case your score is affected by hard pulls, they can jump back up in a short time. So concentrate on ensuring no errors are made on your report and repair your credit score.
Contact us today, and we will handle all your disputes and provide you with tips on sound financial decisions.
Let’s help you into a newer and more fulfilled financial life…
