Hard vs. Soft Inquiries: How They Affect Your Credit Score

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What we'll cover:

  •  When hard inquiries occur and how only you can authorize a hard pull.
  • How long each hard credit inquiry will remain on your credit report.
  • Who can do a soft credit inquiry on your credit report (think: future employer, insurance companies).

Your credit report says a lot about who you are and how you handle money. 

The information in there is personal. 

And a lot of people – lenders, potential employers, future landlords – use your credit history to determine how responsible you are. Fair or not, it’s how we’re judged by many.

So it’s important to understand how a business can access your credit report – not to mention why and what they will see. We’re talking about credit inquiries, which is when you or a ‘legitimate business’, as FICO describes it, requests to check your credit report. Taken a step further, there are two types of credit checks: a hard inquiry and soft inquiry. 

It’s important to know the difference between hard and soft inquiries because there are implications for each. Let’s break it down.

What is a Hard Inquiry?

If you’re looking to borrow money, apply for new credit or an apartment lease, you’re going to have to show lenders your track record of repaying debt. That’s the basic concept behind a hard credit inquiry, also known as a ‘hard pull’.

A hard inquiry is the only type of credit inquiry that can impact your FICO score or VantageScore. And lenders can’t just reach out to one of the three major credit bureaus to pull your credit report on their own. 

The best way to limit hard credit inquiries is to be mindful of how often you’re applying for new credit.

You need to authorize the inquiry. 

Hard inquiries exist for lenders who want to see your payment history, credit history and credit mix to decide if you’ll be a risk to repay debt on-time.

What is a Soft Inquiry?

Unlike a hard inquiry, a soft inquiry will not affect your credit score. You’ll also hear this referred to as a ‘soft pull’. A potential employer could do a soft credit inquiry if you give them permission. Insurance and credit card companies can also do soft inquiries to pre-approve you for offers.

Soft credit inquiries may appear on your credit report, depending on the credit bureau.

According to Experian, here are two common situations in which soft inquiries on your credit report would be visible to someone other than yourself: 

  • Insurance companies may be able to see inquiries from other insurance companies.
  • Current creditors can see soft inquiries if you’ve granted debt settlement companies access to your report.

What are Examples of Hard and Soft Inquiries? 

If you’ve ever asked yourself the question, ‘when is my credit report going to be pulled?’ then this list of examples is for you:

Examples of Hard Inquiries

  • Personal loan application
  • Auto loan application
  • Student loan application
  • Credit card application
  • Mortgage application
  • Apartment or home rental application

Examples of Soft Inquiries

  • Checking your own credit report – If you want to keep tabs on your credit score, you can pull your own credit report as many times as you’d like without impacting the score. Checking your own credit report is one way to ensure the information being reported is accurate.
  • Pre-qualified credit card offer – Credit card companies will do this to ensure they’re sending you the most relevant offer. Does it mean you’ll qualify for all those offers? No, that’s why it’s called a ‘pre-qualified offer’. Still, it’s a good starting point for figuring out what you could be qualified to receive.
  • Pre-qualified insurance quote – Pretty much the same as how credit card companies use soft inquiries. This applies to auto, homeowners or any other type of insurance quote. Insurance companies will do a soft pull so they can create a credit-based insurance score, which is comprised of several elements of your credit history that predict the risk of an insurance loss. Typically, this is just one contributing factor for any increase in rates, denying, canceling or not renewing insurance policies.
  • Employment verification – Getting a new job? Your future employer might want to see your debt and payment history. A 2019 joint survey by the National Association of Professional Background Screeners and HR.com found that 31% of the human resources pros responding used credit/financial information to vet some of their potential candidates and that 13% used that information to vet all potential candidates.

There are also other types of credit checks that could show up on your credit report as hard or soft inquiries, including ones by utility companies and cell phone providers. 

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How Do Hard and Soft Inquiries Affect Your Score?

There’s really no single hard and fast rule for how many points each hard inquiry impacts your credit score, so don’t drive yourself nuts trying to figure it out. FICO says it can vary from person to person based on credit history. FICO also says that a single hard credit inquiry can take less than five points off a person’s FICO Score. If you have a short credit history, a hard inquiry could have a greater impact on your credit score. 

(You’re in the clear with soft credit inquiries – those will never affect your credit score.)

Just be mindful that too many hard inquiries for new credit done in a short period of time is a watch-out for lenders and could negatively impact your FICO Score; lenders could think you’re a risk to repay debt.

While each credit type of credit check counts as a single credit inquiry, FICO factors in ‘rate shopping’ when calculating your FICO score. They consider all hard inquiries for a mortgage, auto or student loans made within a 45-day period as a single credit inquiry. That way your credit score won’t be dinged for each inquiry. The same goes for when you’re searching for a rental property. 

VantageScore, however, does things slightly differently. 

The VantageScore model considers all hard credit inquiries made within a 14-day rolling window as a single credit inquiry.

How Long Do Inquiries Stay On Your Credit Report?

Generally speaking, a hard inquiry usually stays on your credit report for just over two years, but they typically only impact your FICO Score for a year. Same goes for VantageScore: hard inquiries can remain on your credit report for just over two years but a credit score impacted by a hard pull can return to its pre-inquiry level in a few months.

How to Remove Wrong Hard Inquiries

If you’ve spotted an inaccurate hard inquiry on your credit report – say, a hard inquiry done without your permission – rest assured there’s a way to resolve it. 

Each of the three major credit reporting agencies has its own online tool for making credit report disputes. You can also directly contact the company that provided the information to the credit reporting agency. 

The Federal Trade Commission (FTC) recommends you contact both the credit reporting agency and the company that reported the information, in writing, about the inaccuracy. Check out the FTC’s website for a sample letter for disputing errors on your credit report.

How to Limit Hard Inquiries on Your Credit Report

The best way to limit hard credit inquiries is to be mindful of how often you’re applying for new credit. We get that sometimes that’s easier said than done. 

This article is for informational purposes only and is not a substitute for individualized professional advice. Articles on this site were commissioned and approved by Marcus by Goldman Sachs®, but may not reflect the institutional opinions of The Goldman Sachs Group, Inc., Goldman Sachs Bank USA or any of their affiliates, subsidiaries or divisions.