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Some comparison websites and lenders are offering customers ‘soft’ credit searches when applying for loans and credit cards. These promise to not leave a footprint on your credit rating but how do they work? And are they reliable?

Whenever you make an application for a credit card or loan it leaves a mark on your credit score.

Applications typically make up about 10 per cent of your credit score so making a large number of applications can have a negative impact on your rating.

James Jones of credit reference agency Experian says: ‘Every application that is made leaves a footprint on your credit report. If youre making a lot of applications in a short space of time then this can have a negative impact on your score.’

However, some comparison sites and lenders have introduced a ‘soft’ check feature to give customers an indication if they’re likely to get accepted for a product.

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Dear Eva, Is there such a thing as too many credit cards? I currently have five (three personal cards and two business cards). Now that I’ve built my credit score up to 780, I want to take advantage of better card offers. However, I don’t want to close any of the cards I already own because they all have long histories and look good on my credit report. How many more cards can I add to my portfolio without looking like a credit card junkie? Tim Hi Tim, Give yourself a pat on the back for good credit management. Obv Read more…

Many consumers are under the impression that credit card companies only use an applicant’s credit report to determine their financial reliability to then place them within a suitable credit bracket. Credit card companies, however, often use a variety of factors other than the credit score when determining what types of cards and interest rates to offer a prospective cardholder.

Most card companies have a wide-ranging selection of credit cards, with some specifically designed for applicants that have excellent credit, and others that are suitable for sub-prime cardholders. Ultimately, there are three factors considered by credit card companies when issuing interest rates and credit limits, which are income, financial history and credit score/credit report. I

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