Does shopping for a mortgage hurt your credit score?

Shopping for a mortgage doesn’t usually hurt your credit score as long as you manage your applications carefully. Buying a home is one of the biggest financial steps you’ll take, so it’s natural to want to compare your options and find the best mortgage deal. With the right approach, you can explore mortgage offers confidently without damaging your credit. 

But it’s important to understand how credit checks and applications work so you can minimise any impact on your score.

Let's get you started. 

‍Here are the key takeaways:

• Mortgage applications often involve hard credit checks, which can cause a small, temporary dip in your score
  

• Multiple applications within a short period (typically 14 days) are usually treated as one enquiry
  

• If you’re declined for a loan, spacing out applications over time is a good way to protect your report and improve your chances of approval
  

• Pre-qualification checks usually involve a soft search and don’t impact your credit score
  

• Strengthening your credit history before applying can give you access to better mortgage deals and interest rates
  

Why shopping for a mortgage can affect your credit

Shopping around for a mortgage can temporarily affect your credit score because lenders may carry out a hard credit check. These checks are used to understand your financial history and assess your application. 

Each time you apply for a mortgage or request a mortgage in principle (also known as a pre-approval), a lender may carry out a hard credit check. This can cause a small dip on your credit score, but it’s usually temporary so don’t panic. 

Want to learn more? Read our guide to hard and soft credit checks. 

‍Credit reference agencies (CRAs) understand that you’ll want to compare options when choosing a mortgage. This is why they have a rule to protect your credit report from multiple hard credit checks: when you apply for a few different mortgages within a short period (often around 14 days), they are usually grouped together and treated as a single enquiry. This means you can shop around without significantly impacting your score.

How to shop around for a mortgage without hurting your credit

If you want to explore your options and shop around for a mortgage without hurting your credit, here are some practical steps to follow:

Spread out your applications

If you get declined and apply for lots of mortgages over time, it can be bad for your credit because it can make lenders more cautious of your profile. This is because they might believe you may be struggling financially, so it’s better to spread them out if you can.

Multiple applications within a short period are often grouped together as one enquiry. This can still have an impact on your credit score, but it is comparatively small and can shift after a few months if you’re managing your other credit responsibly. 

If your mortgage applications are declined, it can help to wait a few months before reapplying. This gives you time to strengthen your credit history and improve your chances next time. The same applies to other types of credit. Try to leave about six months between applications for credit cards, loans and mortgages. 

‍You can use the time you have between applications to research better offers, save more money for your deposit, and consider other types of mortgages that suit you better. Speak to a mortgage broker (also known as a mortgage advisor) to seek expert advice if you need it as well. That can put you on a better footing when you start again.

A mortgage broker can help you find suitable deals and feel more prepared. Head to our guide on the process of buying a house to learn more about mortgage brokers and when to speak to one.

Consider pre-qualification

Instead of making a full mortgage application straight away, it is possible to request a pre-qualification. Pre-qualifications are an estimate of how likely you are to get accepted and usually involve a soft credit check, so it won’t affect your score. 

‍This can be a helpful way to explore your options without committing to a hard credit check. Especially if you are worried about your score or concerned that your application might be declined for another reason. A pre-qualification is usually different to a mortgage in principle (or pre-approval), which will often require a hard credit check. Check with your lender first.

Strengthen your credit score

Before you start shopping around for a mortgage, strengthen your credit score to improve your chances of being accepted. This can put you in a much stronger position and help you access better mortgage deals. Start by checking your credit reports with each of the main credit reference agencies: Experian, TransUnion and Equifax. This helps you understand where you are and spot anything that might need attention. 

If your credit score isn’t quite where you want it to be yet, that’s okay. A Loqbox membership can help you build your credit over time and get mortgage-ready. Head to our how it works page to find out more.‍

‍Improvements to your credit score are not guaranteed. Missing repayments to Loqbox or other credit accounts may harm your score.