The Two Credit Pulls

When a lender checks your credit report, it’s either a hard inquiry or a soft inquiry. Hard inquiries impact your credit score, soft inquiries do not. However, it’s important to know the differences between the two. Let’s take a look.

What is a Hard Inquiry?

Hard inquiries (or “pulls”) occur when a lender checks your credit to see your creditworthiness. Some common hard pulls are things like mortgage applications, credit card applications, auto loan applications, student loans, and personal loan applications. One hard inquiry could ding your credit score, but it’s usually only by a few points and it’s also usually temporary. Generally speaking, the better your overall credit is, the better it will withstand a hard pull.

Rate Shopping Exemption

One thing you don’t want to do is let the fear of hard pulls stop you from shopping for the best offers from lenders. Both FICO and VantageScore give you a window, or grace period before hard pulls show up on your report. For FICO it’s 30 days and for VantageScore, it’s 14. This means you can shop offers and rates in those time windows and the pulls will be counted as one. The fewer hard pulls, the less impact on your credit score.

What is a Soft Inquiry?

Soft inquiries occur when credit card companies offer you a promotional deal when you check your own credit score or when a company conducts a background check. These pulls do not impact your credit score.

The Big Tell

The difference between hard and soft pulls is that with hard pulls, you are asking a lender to check your creditworthiness as part of a loan application process. A soft pull is more of a limited snapshot of your credit history.