It has been a highly publicized idea the past few years that credit inquiries hurt your credit score, but this is much too broad of a statement. Fortunately, reality is much more understanding.
First, only certain inquiries into your credit negatively impact your credit score. This applies only to actual applications for credit, such as a mortgage, an auto loan, or a new credit card. Simple inquiries to check your credit made by yourself, prospective employers, or companies with whom you have existing accounts, do not hurt your credit score.
Second, do not be concerned about "rate shopping" for a mortgage or auto loan, because multiple inquiries for the same purpose count only as one inquiry. For example, if you request quotes from five banks for a home equity loan, only one inquiry will count against your credit.
Finally, even the inquiries that do have an adverse affect have relatively little impact. While it is true that applying for a dozen credit cards over the span of a few days makes you look desperate for cash, inquiries can only stay on your credit report for a maximum of two years, and only account for 10% of your composite FICO score.
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