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Does getting preapproved for a car loan impact your credit score?
My mom told me that I should get preapproved for a car loan before I shop for a car. I'm worried about what this might do to my credit score. Does a preapproval affect your credit score?
Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
Yes, getting preapproved for a
car loan
can hurt your credit score—but the effect is only temporary.When you apply for preapproval for your car loan, the lender will conduct a hard inquiry on your credit report. This may result in a drop of five to ten points on your credit score.
Keep in mind: Credit bureaus allow you to get multiple inquiries over a 14-day period, and they all count as just a single hard inquiry. So it makes sense to shop around for the best rate during this time.
After you’ve applied for a car loan, you can generally expect that hard inquiry to remain on your credit report for about two years, but according to Equifax, your credit score itself will typically only be affected for a year.
View full answer
- Gregory R.
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