Credit inquiries are known to degrade a person’s credit score because statistical studies have revealed that multiple inquiries are related to a high risk of default. This is because borrowers who are often rejected by lenders usually try to contact several lenders in the attempt to locate one who may finally approve their application.
However, multiple mortgage inquiries may also be caused by buyers who are trying to locate the best deal. The answer to the question is that credit scorers try to avoid degrading the rating of shoppers by not taking into account mortgage inquiries that happen within 30 days of a score date. Also, to avoid bias that are caused by earlier shopping attempts, credit scorers also consider all mortgage inquiries within span of 14 days as one inquiry. Thus, your mortgage inquiries can only downgrade your credit score if you do your shopping within a span of many months. And because mortgage rates fluctuate, there is really very little reason to prolong the shopping period by more than a month.
However, if a shopper has decided to stop shopping and several months later, he wants to shop again, he can minimize the credit score damage by doing his shopping within 14 days or less. The mortgage inquiries during this period will therefore only count as one!
Meanwhile, it should also be noted that self-inquiries do not affect credit score. Credit bureaus do not count the attempts made by the consumer to check on his own credit report. Inquiries by possible employers and current creditors will also not count.