We pride ourselves on the remarkable improvements people can see in their credit scores after just a few months on the CredEvolv platform. But it’s important to remember that building or rebuilding your 523 credit score is a marathon, not a sprint. The end goal is to gain habits and knowledge that will enhance your credit endeavors for a lifetime.
Still, big results in a short period of time are a major motivator to keep going. CredEvolv client Ariel T. recently found this out firsthand!
Ariel had a 523 credit score due to late payments and new account inquiries. We connected him with a nonprofit credit counselor who removed those negative items from Ariel’s credit report. Five months later, with a credit score of 580, the 600s are within reach as Ariel continues working toward his goal of a 680 credit score.
What are credit inquiries?
When you apply for new credit, the lender will make a credit inquiry to check your credit report. There are two types of inquiries:
- Hard inquiries. These occur when a lender checks your credit report as part of the approval process for a loan or credit card. Hard inquiries can slightly lower your credit score and remain on your report for two years.
- Soft inquiries. These occur when you check your own credit, when a lender checks your credit for pre-approval offers, or when an employer conducts a background check. Soft inquiries do not affect your credit score.
What impact do credit inquiries have on a 523 credit score?
Lenders view multiple hard inquiries within a short period of time as a potential sign of irresponsibility, financial distress, or other indications of high risk. However, several inquiries related to mortgage or auto loan applications within a brief timeframe are typically treated as a single inquiry for scoring purposes, as it’s assumed you’re rate-shopping or otherwise being smart about your borrowing.
In Ariel’s case, he’s learned to be more discerning about how often he applies for credit going forward. He also understands the importance of making his loan payments on time, every time. Not surprisingly, his original 523 credit score is on the way up!
Read more credit success stories here.