If you’re like many Americans, your mailbox is filled with daily, weekly, or certainly monthly offers from credit card companies, insurance companies, and other vendors that have prescreened you by assessing your credit score—and decided to make you an offer.
The question often arises: Do these frequent credit checks harm your credit score? And, if so, what can you do to prevent them?
Here’s the good news: Only credit checks initiated by you, the consumer, affect your credit scores. These so-called “hard inquiries” occur when you take an action such as signing up for a new credit card, mortgage, or other offer that requires a credit check.
When a company prescreens you without your permission, that’s different—it’s a “soft inquiry.” Soft inquiries do show up on your credit report, where they’re listed as “Account Review” or “Promotional Inquiries,” but they have no effect on your credit score. The same is true for your free annual credit report—it has zero impact on your credit score.
Now, if you decide to accept one of those prescreened promotional offers that lands in your mailbox, the lender may conduct a second, more thorough review of your credit. When that happens, regardless of whether the vendor ends up giving or denying you credit, it can lower your credit score up to about 10 points.
Again, prescreened offers won’t harm your credit score one bit—unless you act on them. If you want to avoid being tempted by the offers, you can easily opt out from receiving such offers for five years or even permanently.