Applying for credit cards can hurt history

There are many different things that can send a consumer's credit score on a downward spiral, from letting student loans go into default to missing payments on electric bills. Once the credit history has a red mark against it, it's very difficult and can take a long time to fix the issue and get back into good standing. For some, this is virtually impossible without years of careful budgeting and payments.

However, many people are also unaware that a common task also has the ability to adversely affect one's credit history - simply applying for a new line of credit, whether or not the application is approved or purchases begin. According to Index Credit Cards, filling out an application for a new credit card, loan, mortgage or other line appears to a credit bureau as an "inquiry."

Having some of these comments on a report is fine, the source explained, particularly if the history was pulled for a reason other than to apply for a new line of credit, but too many can negatively influence the score.

Rather than potentially damage an already dismal credit score by applying for multiple new credit lines, individuals can consider asking their local credit bureau about their Payment Reporting Builds Credit score. This is compiled by using records of steady payments on utilities accounts as evidence that the consumer wouldn't be a risk for a loan or credit card.