There are so many credit cards out there — what’s to stop you from trying to get a bunch of them in your wallet?
Potentially, nothing. If you have excellent credit, you may qualify for most of those great offers. Even if your credit isn’t stellar, you can still get your hands on credit card applications. Anyone can get credit card applications, but they’re not like job applications, of which you might fill out dozens before someone hires you. Every time you apply for credit, a hard inquiry shows up on your credit report, and even though each hard inquiry only hurts your credit score a little bit, having many of them pop up within a short period of time (say, six months) can really bring your score down.
That doesn’t mean there’s never a good reason to apply for multiple cards within a short time frame. Gerri Detweiler, Credit.com’s director of consumer education, gave an example:
“I think it’s OK to apply for a couple cards, if there are two you really want, and see which one gives you the best deal,” she said. “But I wouldn’t apply for a bunch at once.”
What if you want a certain card, but aren’t sure you can qualify for it? Say a credit card issuer has a cash-back card you’d really like, and there are two versions: One with an annual fee and one without. The one without the fee generally only accepts applicants with excellent credit, while the other would take those with average credit. You want the one without the fee, but you’re not sure you’d be approved. Is there a way to simultaneously apply for the next best thing, so your credit report only shows one inquiry?
Not really. You can always fill out the application for the annual fee card if your first choice gets rejected, but that would probably generate two hard inquiries. That’s not necessarily going to hurt you much, but if you’re looking to minimize inquiries on your credit report, you may want to reconsider applying for multiple credit cards.
Applying for credit is always a bit of a risk, because there’s no way to know exactly how a lender makes its decisions. One of the smartest things you can do is check your credit score before applying (and there are many ways to get your credit scores for free, including from Credit.com) and seeing if it puts you in the range generally accepted for that product — even then, you may not be looking at the same credit scoring model as the lender. If you’re concerned about how applying for credit could hurt your credit score, it’s best to do a lot of research beforehand and apply for credit sparingly.
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This article originally appeared on Credit.com.
This article by Christine DiGangi was distributed by the Personal Finance Syndication Network.