Now this first building block we're going to talk about are inquiries, specifically, hard inquiries. One of the building blocks or inquiries, those times that you or other people, companies, creditors access your credit report for approval, or review. It could be for insurance purposes, application for credit, checking on your credit for rental purposes or simply applying for credit for a home or auto purchase. Each time a credit report is pulled, there may be a reduction in your score, but this is only for what is called a hard inquiry or a hard poll. A hard inquiry is one that you authorize when you apply for credit. You may also want to shop for an auto loan or you are applying for a home loan.

The caveat here As a hard inquiry will cost you in fact scoring points, usually three to five points for each time your credit report is checked. Now there are allowances for people that may be shopping for an auto loan or for a home loan. Typically the credit out the credit score algorithms will allow a period of time for you to shop for a loan it may be two weeks to one month in which different creditors check your credit. However, applying for a credit card is a totally different matter to repeat. Applying for a credit card is a totally different matter in that each time you apply for a credit card, you will receive a three to five point credit score reduction each time and every time. Remember at Christmas time when you were purchasing gifts for your family and they ask at the register, whether you want a 20% discount on what you have purchased If you apply for a store credit card, can you imagine what happens to the poor unsuspecting person who applies for 20 credit cards at Christmas to get the 10% discount?

What happens is a profound FICO score drop