 TITLE: Does Refinancing a Personal Loan Hurt Your Credit Score? CONTENT: How Refinancing Impacts Your Credit Score\n-----------------------------------------\nHere's a look at the three main steps in the loan refinancing process and how each one can affect your credit scores.\n### 1\\. Shopping for a New Loan\nEach loan application you submit could result in a hard inquiry, a record of when a lender checks your credit report before making a lending decision. Hard inquiries stay on credit reports for two years and may affect credit scores for the first 12 months.\nWhen they impact your credit scores, hard inquiries tend to lead to a small drop. The drop is often offset within a few months as long as you're making on-time payments on your new account and no other negative information gets added to your credit report.\nMultiple hard inquiries during a short period can increase the drop in scores. However, credit scoring models also know that rate shopping is a financially savvy practice.\nWith this in mind, some credit scoring models don't consider inquiries from the last 30 days, meaning your applications from last week won't impact your application this week. Scoring models may also count all the hard inquiries that occurred in a 14- to 45-day window as a single inquiry when calculating your credit scores.\n### 2\\. Opening Your New Account\nOpening the new loan you'll use to refinance your personal loans can impact your credit scores in several ways:\n*   It may shorten your average age of accounts, which could hurt your credit scores.\n*   If you're taking out one new loan to refinance multiple personal loans, that might increase your scores because you'll have fewer open accounts with balances.\n*   As you start repaying your new loan, your on-time payments can help you build a positive credit history, which can increase your scores.\n### 3\\. Paying Off Your Old Loans\nThe loans you refinanced will be closed once they're paid off. The old accounts will remain on your credit reports for up to 10 years, and any negative or positive information associated with the account, such as late or on-time payments, could still impact your credit scores during that time.\nYour scores may be hurt when your closed accounts drop off your credit reports, as that could decrease the length of your credit history and average age of accounts.\n> Find the best personal loans in Experian CreditMatch™. END