Your credit score is an important factor in obtaining financing for that new car you have your eye on.

It helps lenders determine whether or not to approve you and what kind of rates you'll get. There are a lot of factors that can affect your credit score: your percentage of on-time payments, how many credit cards you have open and the balances they hold, as well as inquiries.

There are two types of credit inquiries: hard and soft. A soft inquiry happens when a person or company checks your score for something such as a background check or for credit card offers. Soft inquiries won't affect your credit score.

On the flip side, hard inquiries happen when you apply for major loans or credit cards. Unlike soft inquiries, a hard inquiry will affect your score — but only by a few points or so. Hard inquiries take two years to fall off your credit report.

Multiple Credit Inquiries

Many consumers will shop around for a loan to get the best rates, meaning multiple credit inquiries are made on their reports in a short amount of time. Fortunately, VantageScore and FICO provide a buffer during which all the inquiries count as one: 14 days for VantageScore, 45 days for FICO, according to Credit.com and CreditKarma.com. If you see a dramatic drop in your score after shopping for a loan, check to see if you're monitoring a custom bureau score or educational score.

A Little Advice

Your credit scores are important. Before you apply for a loan, you should take the time to care for your financial well-being by building your credit (if your credit isn't so great). Also, when applying for a loan or credit card, ask the lender how the inquiry will be classified: hard or soft. CreditKarma recommends checking your credit score often; if you find any hard inquiries that you did not authorize, you can always dispute them with the credit bureau.

Here at Hyundai of Kennesaw, we work with all types of credit, so don't feel scared to come in. Our finance department will help you understand the process and explain anything that you might not understand.

Want to learn more or ready to take a test-drive? Give us a call or stop by our dealership at 2878 Barrett Lakes Blvd, Kennesaw, GA 30144. We look forward to helping customers from Marietta, Acworth and the greater Atlanta area.