Do Credit Searches Really Affect Your Credit Rating?

jimbo26

I see numerous posts about too many credit searches having an adverse affect on your credit rating. I'm not sure they do. I think other factors have far more of an affect.

My research is by no means scientific but based on my own experience. Last weekend I applied for three credit cards and a bank account in the space of 24 hours. Accepted for all four with decent limits and good APR's. This number of searches is normally considered a real no no, but had no real affect at all.

I think what really matters is the state of your current commitments, how maxed out you are etc., and recently missed payments. This is a better indication of someone that is desperate for credit, rather than someone with (in my case) three credit cards with £0 balance and rows of green 0's.

In conclusion if you are financially buoyant I don't think numerous searches really make much difference.

Clariman

The number of credit searches is one of many factors that are used to make a lending decision. The amount of available credit and the percentage used of available credit are two major factors.

In your own situation it may be that when you come to apply for another cards in a few months time, you could find it harder. Because at that time, your available credit will be much higher (assuming you accept all the cards you have recently applied for).

Clariman

jimbo26

I agree it has an affect, but I'm not sure it has a big an affect as people think.

YorkshireBoy

jimbo26 wrote: »

I agree it has an affect, but I'm not sure it has a big an affect as people think.

I have (or had, the last time I made 4 applications in my lunch hour) a theory that searches are not registered immediately (at least not for other lenders to see). I believe they go through some validation procedure and are registered later...perhaps 24 hours or so later. I'm willing to bet you wouldn't have had the same result had you left 48 hours between each search, rather than doing them all together.

bathgatebuyer

I remember reading somewhere that 10% of your credit score was based upon applications made - I made a trawl through a load of academic sites where researchers had tried looking into it. That figure seemed to stick in my mind.

jimbo26

YorkshireBoy wrote: »

I have (or had, the last time I made 4 applications in my lunch hour) a theory that searches are not registered immediately (at least not for other lenders to see). I believe they go through some validation procedure and are registered later...perhaps 24 hours or so later. I'm willing to bet you wouldn't have had the same result had you left 48 hours between each search, rather than doing them all together.

I checked my Experian report straight after the applications and they were all registered. I think the checks are recorded instantaneously.

YorkshireBoy

jimbo26 wrote: »

I checked my Experian report straight after the applications and they were all registered. I think the checks are recorded instantaneously.

You could see them, but could other lenders see them so quickly? (Rhetorical question, because you won't know the answer to that one).

Clariman

YorkshireBoy wrote: »

You could see them, but could other lenders see them (so quickly)?

Yes I think they do. What they won't see is an active account with a specific credit limit, but searches are recorded real time as far as I am aware.

Clariman

Clariman

Having spoken at length with a CRA and a credit industry insider, I wrote this Guide to Credit Score which you might find interesting. It goes in to some detail about what lenders actual look for and how they do it.

Clariman

jimbo26

Just applied for a Barclaycard Platinum card and been accepted. That's 7 checks in a month. Accepted on all.

Tori_Bellatrix

jimbo26 wrote: »

Just applied for a Barclaycard Platinum card and been accepted. That's 7 checks in a month. Accepted on all.

But did you have any in the preceeding months?