 TITLE: Can a Personal Loan Hurt My Credit Score? CONTENT: When you apply for any type of credit, including a loan or credit card, the lender typically requests access to your credit report so it can assess the risk of nonpayment based on your credit history. That request for access leads to a hard inquiry on your credit report, which will remain there for up to two years. A hard inquiry can trigger your credit scores to drop slightly, but they're likely to recover within a few months to one year—and the impact will decrease with time as you continue to make on-time bill payments and show other positive credit behavior.\nA personal loan can also hurt your credit if you wind up missing even a single monthly payment. A missed payment will have a much more significant impact on your credit than the other factors, since payment history accounts for 35% of your FICO® Score☉ . Even if you're able to stay on top of your personal loan payments, though, they could stress the rest of your finances and put you at greater risk of credit score harm caused by late payments on your other accounts.\nFinally, the added debt from a personal loan contributes to the \"amounts owed\" category in FICO® Score calculations, which accounts for 30% of your FICO® Score. Merely owing money doesn't mean you're considered a risky borrower—and it won't sink your score—but high balances on credit accounts and the presence of loans with large balances left to pay off can negatively impact your credit. Additionally, while your debt-to-income ratio (DTI) isn't included in credit score calculations, a high DTI can make it difficult to qualify for certain types of loans, like mortgages, where lenders look specifically at DTI when making credit decisions. END