Applying for the Amazon Credit Card will result in a hard inquiry on your credit report. This is something important to keep in mind, as too many hard inquiries in a short period of time can negatively impact your credit score. In this article, we’ll take an in-depth look at how the Amazon Credit Card application impacts your credit.
What is a Hard Inquiry?
When you apply for any type of credit – a credit card, loan, mortgage, etc – the lender will pull your credit report to evaluate your creditworthiness. This is known as a hard inquiry.
Hard inquiries can lower your credit score slightly, especially if you have several in a short period of time. That’s because having a lot of recent inquiries can be a sign of increased credit risk. However, a single hard inquiry typically only drops your score by a few points.
Does the Amazon Card Cause a Hard Pull?
Yes, applying for the Amazon Credit Card issued by Chase will result in a hard inquiry on your credit report.
Chase Bank will access your credit report from one or more of the three major credit bureaus – Experian, Equifax, and TransUnion. They need to review your credit history to determine if you meet the approval requirements for the card.
So if you apply for the Amazon Credit Card, you can expect to see a hard inquiry from Chase on your next credit report. This hard pull may cause a small drop in your credit score.
How Long Does the Hard Inquiry Stay on Your Report?
The hard inquiry from your Amazon Credit Card application will generally stay on your credit report for 12 months. However, FICO credit scoring models only factor in hard inquiries from the past 6 months when calculating your score.
After 6 months, that hard inquiry will still be on your report but it will no longer impact your score. After 12 months it will fall off your report completely.
This means that while the hard pull causes a small temporary drop in your scores, it’s impact fades over time. As long as you don’t have a bunch of other recent inquiries, one from the Amazon card application is nothing to worry about.
Who is the Hard Inquiry Visible To?
When you apply for the Amazon Visa, the resulting hard inquiry will be visible to you and to any other creditors that access your credit report. However, most credit scoring models only look at your own hard inquiries – not those initiated by others.
For example, if you check your own credit, you’ll see the hard inquiries made when you applied for credit. But the FICO models only consider inquiries that you initiated when calculating your score. Inquiries by others don’t get factored in.
So while you can see all hard inquiries on your report, most of the time only lenders see the full list. Credit scoring models disregard the inquiries not initiated by you personally.
How to Minimize the Impact of Hard Inquiries
If you want to apply for the Amazon Credit Card but are worried about the hard inquiry, here are some tips to minimize the impact:
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Space out applications – Apply for new credit sparingly, such as once every 6-12 months. This allows time for the inquiries to fall off your reports.
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Check credit reports – Review your credit reports before applying to fix any errors. This helps ensure your scores are as high as possible beforehand.
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Watch credit utilization – Keep balances low on all cards. High utilization on other cards can outweigh the impact of a new hard inquiry.
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Build credit history – Having a long credit history also helps counteract dips from new hard inquiries.
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Monitor FICO scores – Check FICO scores from all three bureaus both before and after applying, since different scoring models are used.
As long as you have good credit hygiene overall, a single hard pull from the Amazon Credit Card is unlikely to be a major issue. But being aware of its impact and taking steps to minimize it allows you to make the best application decision.
Amazon Credit Card Approval Requirements
In order to be approved for the Amazon Credit Card, most applicants need a good to excellent credit score. Here are some of the key approval requirements:
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Credit scores – You’ll typically need a FICO score of at least 670 to be approved. Scores of 700 or higher are ideal.
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Credit history – Having at least 3-5 years of established credit history will help your approval odds.
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Low utilization – Keep credit card balances below 30% of the credit limit on each card. Lower is better.
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Limited hard inquiries – Too many recent inquiries can negatively impact approval chances. Avoid applying for multiple cards close together.
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No recent missed payments – Missed or late payments can result in denial. Keep your accounts in good standing.
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Debt-to-income ratio – Your total monthly debt payments compared to income should not exceed 40-45% for the best approval odds.
Meeting these requirements provides the best shot at instant approval for the Amazon Credit Card. But having less-than-ideal stats doesn’t necessarily mean denial. You may just have to wait for a manual review of your application.
Checking Your Rate Without a Hard Pull
If you want to check your chances of approval for the Amazon Card without a hard inquiry, some third-party sites provide prequalification tools.
These soft credit checks won’t affect your credit scores. They give you an idea of whether you may be approved without a hard pull. Here are some options:
- Credit Karma prequalify tool
- Credit Sesame preapproval tool
- Chase’s own prequalification tool
However, prequalification is not guaranteed approval. Chase will still perform a hard inquiry when you formally apply. Prequalification just helps gauge your chances.
Weighing the Pros and Cons of Application
Before applying for the Amazon Credit Card, weigh the rewards you could earn against the temporary effect of the hard inquiry.
Potential pros of applying:
- Earn 5% back on Amazon and Whole Foods purchases with Prime membership
- No annual fee
- $100 Amazon gift card upon approval
- No foreign transaction fees
Potential cons of applying:
- Hard inquiry and temporary credit score drop
- Must have a Prime membership to earn full rewards
- High APR if you carry a balance
For frequent Amazon shoppers with good credit, the rewards generally outweigh the small impact of the hard inquiry. But be sure to consider your own spending and credit profiles.
In Summary
Applying for the popular Amazon Credit Card issued by Chase Bank will result in a hard credit inquiry, which can cause a minor drop in your scores. However, for those with established credit histories and robust credit profiles, the impact of a single new inquiry is generally minimal. Weigh the pros and cons carefully given your personal situation. Check your prequalified rates first and maintain good financial habits to offset inquiry effects.
