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How Many Credit Applications is Too Many

by Jim ONeil on June 1, 2011

in credit history

This is a great question because a lot of people are not aware that merely applying for a credit card negatively affects your credit report. Each time a person puts in an application, whether the card is approved or not, the credit score will go down.

Not only that, these inquiries will stay on the credit report for two full years.

Having a single credit inquiry on your credit report is not necessarily a bad thing. The problem arises when a person has multiple inquiries over a very short period of time. This is especially true when the person has the bulk of their credit already maxed out.

This is something that throws a red flag up to creditors in that it is a sign that the borrower is probably in over their heads and looking for more credit as a lifeline.

Because borrowers are more cautious than ever these days, it is best to only apply for credit when it is truly needed and when you are fairly sure you are going to be approved. For instance, if your credit is maxed out and you have a credit rating of 500, there is little chance that another borrower is going to take a chance and approve another credit card.

Keep the inquiries to a minimum and when there are three or more on your credit record, allow the period to pass where they will drop off the report before applying for credit again.


Good credit is credit used that will earn you money or be for an asset that does not lose value over time. Examples would be for starting a business, investing, college education, a house.

Bad credit is credit used on things that do not keep their value, cost you more money in the long run, and/or do not make you money. Examples would be clothes, eating out, vacations, TVs, stuff like that.

Some things are hard to classify like a car. It does not hold its value and in of itself it does not make you money. However, it is a necesity and can help you get a job that makes you money. It can cost you money over time though especially with gas, insurance, and maintance. Jewelry is also in a gray zone. It can gain value over time but that is not a guarantee. Jewelry bought by an expert with credit could be good credit since an expert would have a better idea of how well a piece of jewelry will gain value. Many people buy up jewelry thinking they can sell it back for what they paid for it or more but in the end find out that they sell it back for half that amount or less.

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