Having too many inquiries for new credit can negatively impact your credit score, which is the key reason why the answer focuses on a decrease in credit score. When you apply for new credit, lenders conduct a hard inquiry to assess your creditworthiness. Each time this happens, it can signal to potential lenders that you may be overextending yourself financially, especially if multiple inquiries are made over a short period of time.
Multiple hard inquiries can lead to a decline in your credit score, as the scoring models used by credit bureaus usually factor in the number of inquiries alongside your overall credit utilization, payment history, and length of credit history. Therefore, even if you are financially sound, an excessive number of inquiries might raise red flags for lenders.
While an increase in available credit limit, approval of additional loans, or even better employment opportunities might seem like potential outcomes of seeking new credit, none of these directly correlate with the consequences of numerous credit inquiries. In fact, frequent inquiries are more likely to inhibit the approval process for loans or credit products rather than promote it.