Does opening a new credit card hurt your credit?

Opening a new credit card can be a way to find a low interest rate, earn travel rewards or take advantage of an introductory offer. When you open a new credit card account, you might see a brief dip in your credit scores. But if you use your credit card responsibly, it could give you the opportunity to boost your credit in the long run.

Here’s what you need to consider before opening a new credit card—and some of the benefits you may experience with your new card.

Key takeaways

  • Applying for and opening a new credit card may cause a temporary dip in your credit scores. 

  • Getting pre-approved for a credit card only requires a soft inquiry, which won’t impact your credit scores.

  • A new credit card might help reduce your credit utilization ratio and improve your credit mix—which could positively impact your scores over time with responsible use.

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Will opening a new credit card hurt my credit scores?

Applying for a new credit card can trigger a hard inquiry, which involves a lender looking at your credit reports. According to credit-scoring company FICO®, hard inquiries can cause a slight drop in your credit scores

Keep in mind that hard inquiries usually stay on your credit reports for two years. However, they may not have an effect on your scores for that long. For example, credit-scoring companies may only consider hard inquiries for up to 12 months. But experts don’t advise opening several new credit accounts in a short period of time.

Before applying for a credit card, it’s a good idea to get pre-approved. Pre-approval typically results in only a soft inquiry into your credit—which means it won’t impact your credit scores.

Benefits of opening a new credit card

While opening a new card can negatively impact your credit score in the short term, it may actually benefit your score in the long term as long as you use your card responsibly. Take a closer look at some of the benefits of applying for a new credit card:

Decrease your credit utilization ratio

When you open a new credit card, your available credit increases. This could improve your credit utilization ratio. This ratio refers to how much total available credit you’re using, and it’s a factor in calculating your credit scores. Experts recommend keeping your credit utilization ratio below 30%. 

If you avoid charging large purchases and keep your balance low, you could maintain a low credit utilization ratio.

Improve your credit mix

Your new card could improve your credit mix—the different types of credit accounts you have. Mortgages and student loans are common kinds of what might be considered good debt, or debt that helps borrowers build wealth. Credit card issuers like to see that borrowers can responsibly manage these different types of debt—making payments on time and in full.

Other benefits

Opening a new credit card could also help you:

  • Take advantage of introductory offers and sign-up bonuses

  • Establish or build a strong credit history with consistent, on-time payments.

  • Use a balance transfer to help pay off high-interest debt at 0% or low introductory rates.

  • Find a card with a great rewards program.

Does pre-approval for a credit card lower your credit scores?

Pre-approval offers can help you explore your options before you apply for a new credit card. The good news is that pre-approval doesn’t affect your credit scores. But if you choose to apply for a pre-approval credit card offer, the application will trigger a hard inquiry, which can impact your scores. 

Checking whether you’re pre-approved before applying for a credit card could minimize the number of hard inquiries on your credit report. And that’s because receiving a pre-approval offer often means you have a good chance of being approved for that specific card. 

Focusing on applying for cards you’re pre-approved for could help you avoid application rejections.

What to consider before applying for a new credit card

It’s hard to pinpoint exactly how opening a new credit card could impact your credit scores. But responsibly using a new card could give you a credit-building opportunity with lots of benefits. 

Introductory offers, rewards programs, interest rates and eligibility requirements are a few important factors to consider. The Consumer Financial Protection Bureau (CFPB) recommends only applying for the credit you need. So focusing on the credit card features best suited to you can help you narrow down your search. And looking at your pre-approval odds helps you explore your options before you apply—without affecting your scores.

It’s also worth keeping in mind that opening a new credit card could result in a decrease in your credit scores. That’s because applying for the card will result in a hard inquiry. And opening the account will lower the average age of your credit accounts—a factor in calculating credit scores. But the good news is that this decrease is temporary and typically minor—your scores will likely only drop by a few points.

New credit cards and credit scores FAQ

Learn more about how opening a new credit card impacts your credit scores with the answers to these frequently asked questions:

If you’re thinking about applying for a loan, such as a mortgage, it’s best to hold off on applying for a new credit card until sometime after you’ve applied for the loan. That’s because the temporary drop in your credit scores may affect your approval or the interest rate you pay on your loan. To avoid this, experts recommend waiting about three to six months between applications for a loan and a new credit card.

Opening a new credit card should decrease your credit scores by just a few points—usually around five to 10 points.

Applying for a credit card triggers a hard inquiry, which stays on your credit report for one to two years. However, your scores should rebound within a few months—as long as you’re using the card responsibly.

The impact of opening a new credit card in a nutshell

When you open a new credit card, a small and temporary drop in your credit scores is possible. But using your card responsibly can help offset this impact. Making consistent on-time payments and avoiding high balances can have a positive impact on your credit scores over time. 

Remember that you may be able to see whether you qualify for new credit before triggering a hard inquiry. Explore new credit cards with Capital One and get pre-approved quickly and easily without impacting your credit scores.

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