Think of this as the opposite of Length of Time. If you are suddenly opening a lot of accounts, that can be a problem.

How many requests for credit have you made lately?
Inquiries remain on your history for 2 years, though the score only includes those made in the last 12 months. The New Credit score looks at the type of accounts (bank, retail or installment) and the limits you are seeking.

What types of accounts are you opening?
This is not always bad. When looking at New Credit, lenders look at frequency of requests by type. Let’s say your credit report shows inquiries from Ford, GM, Toyota and Dodge in a few weeks. It also shows inquiries from a finance company and two banks. Well, that means you are shopping for a car. Being a good shopper looking for the best car or the best rate on a car loan, does not necessarily make you a credit risk.

Where you raise red flags is when you apply for 6 new retail cards—one every two months. Each is also active. Now, you are taking on an unusual amount of debt. There may be a good reason, but this is not normal behavior.

What will this do to my score?
10% of your credit score looks at the number and type of new credit accounts you acquire. Research indicates that this action makes you a higher credit risk. Each inquiry accounts for about 5 lost points. If you have 6 or more inquiries in the last year, you are 8 times more likely to declare bankruptcy than people with no inquiries.

Actions for Better Credit:

• Check your credit report regularly. Maybe you filled out what you thought was a survey, but the retailer looked at your credit report to offer you an account.
• If you’ve had problems in the past, especially if you were out of work for a while, but your life is now better, be careful. Don’t go too fast, even if you got a great job at twice the salary. Make sure each account you open is really one you need.
• If you’re shopping for auto loan or mortgage rates, try to get your inquiries close together (within a month or two). The formula does a good job of recognizing these types of transactions and won’t lower your score.