So I was talking to the local Mazda dealer about the possibility of ordering an RX-8 there and they said that they'd have to run a credit check on me. However, I've heard that running a credit check actually hurts your credit rating. Is this true?

Originally posted by m477
So I was talking to the local Mazda dealer about the possibility of ordering an RX-8 there and they said that they'd have to run a credit check on me. However, I've heard that running a credit check actually hurts your credit rating. Is this true? True but i think there's a generally accepted allowance per year or something.... I haven't had a credit check done in some time so I am not worried.. come the end of next month all my credit cards will be completely paid off... so I'm one happy camper :)

Everything that I've read says that that is true.

Running a credit check (or inquiry, as they are called in the business) does not hurt your credit rating. However...having many inquiries within a year or so does look bad to potential lenders, and can make the difference between getting rejected and getting dough.

I work in the credit industry as a risk analyst. I can speak to this topic and credit evaluation ad nauseum, but typically lenders don't worry about less that 4-6 inquiries in the last 12 months, and that varies by lender. More than 6 inquiries will certainly hurt your chances though.

Best thing to do to keep your credit rating in good shape is to avoid delinquency on your accounts and keep your revolving credit lines (i.e. visa/MC and other store cards) to a minimum utilization rate. Use them to a point you can pay them off in a few months at most.

If anyone is truly concerned about their credit reports, there are a lot of oppotunities to get a free report on the Web. I suggest you do this before looking to make any large purchase requiring financing. There are errors made in reporting that can adversely affect you. Just check that everything is accurate. if you find something that is incorrect, dispute it with the reporting agency and the lender. They are required by law to resolve this discrepancy within 60 days.

Hope this helps.