Credit 101

Reader Question: Does being turned down for credit hurt your credit score?

Comments 6 Comments

We received an email from Angie today asking about how to rebuild her credit after a bankruptcy filing. In her question, she mentioned a common credit rumor:

I do not have any credit cards and I am afraid to apply for one because I think I will be turned down due to my bankruptcy.  I was told that being turned down for credit lowers your credit score so I won’t apply.

This is a fairly prevalent credit myth. The truth: being turned down for credit does not impact your credit score at all. In fact, application approval and rejection information it isn’t even reported to the credit bureaus – Equifax, Experian and TransUnion.

When you apply for a new account, an inquiry record will appear on the credit report that was used in the review. An inquiry is simply an item on your credit report that shows that someone with a "permissible purpose" under FCRA regulations
requested a copy of your credit report.  (Click here for a sample of an inquiry records on an Equifax credit report.)

Inquiries can cause a small ding in your credit score, but this occurs whether or not you are accepted for the account. If you apply for new accounts excessively, you may see a more noticeable decrease in your credit scores.

Do you have a credit question? Have you heard a good credit rumor lately? Share your feedback and questions in the comments section below.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

  • Tim MMF

    Good to know. I think many people are under the impression that it does affect your score.

  • Emma

    I’d be surprised that they would deny anyone. I mean, dead folks and dogs get pre-approved all the time. :)

  • CR

    I have a question about melding excellent credit and terrible credit scores when two people get married. Can creditors come after a new spouse for their partner’s debt? Will the bad credit history of one spouse ruin the good credit of the other?

  • Emily Davidson

    Hi CR -
    Great question! I’ll answer it in a post later today. In the meantime, you might want to check out this –

  • Chris Howard

    thanks for the great information

  • tasha

    if someone with a history with bad credit list you as a personal reference and they end up not paying the bills and it goes all wrong, does that hurt the personal references credit

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