Understanding Credit Inquiries: Hard vs Soft Pulls
Everything you need to know about how credit checks affect your score
Credit inquiries occur whenever someone checks your credit report. Understanding the difference between hard and soft inquiries is crucial for protecting your credit score and making informed financial decisions.
What Are Credit Inquiries?
A credit inquiry (also called a credit pull or credit check) happens when a person or company requests to view your credit report. There are two types: hard inquiries and soft inquiries, each with different impacts on your credit score.
Hard Inquiries
Impact: Can lower your score by 5-10 points
Duration: Stays on report for 2 years
Requires: Your permission
Common for: Loan applications, credit cards, mortgages
Soft Inquiries
Impact: No effect on credit score
Duration: Visible only to you
Requires: No permission needed
Common for: Pre-approvals, background checks, self-checks
When Hard Inquiries Occur
| Situation | Type | Impact |
|---|---|---|
| Applying for credit card | Hard | 5-10 point drop |
| Mortgage application | Hard | 5-10 point drop |
| Auto loan application | Hard | 5-10 point drop |
| Personal loan application | Hard | 5-10 point drop |
| Apartment rental application | Usually Hard | 5-10 point drop |
When Soft Inquiries Occur
| Situation | Type | Impact |
|---|---|---|
| Checking your own credit | Soft | No impact |
| Pre-approved credit offers | Soft | No impact |
| Employment background check | Soft | No impact |
| Insurance quote | Soft | No impact |
| Existing creditor review | Soft | No impact |
Rate Shopping Protection
Credit scoring models recognize that consumers shop around for the best rates. Multiple hard inquiries for the same type of loan within 14-45 days (depending on the scoring model) count as a single inquiry. This applies to:
- Mortgage applications
- Auto loans
- Student loans
Important: This protection does NOT apply to credit card applications. Each credit card application counts as a separate hard inquiry.
How to Minimize Hard Inquiry Impact
Best Practices
- ✓ Only apply for credit when you truly need it
- ✓ Use pre-qualification tools (soft pulls) before applying
- ✓ Complete rate shopping within 14-45 days
- ✓ Space out credit card applications by 3-6 months
- ✓ Check your own credit regularly (soft pull)
The Bottom Line
Understanding credit inquiries helps you protect your credit score while still accessing the credit you need. Soft inquiries are harmless and should be used liberally for checking your credit and getting pre-qualified. Hard inquiries should be strategic and limited to when you're seriously pursuing credit. By rate shopping within the protected window and spacing out applications, you can minimize the impact on your credit score while finding the best financial products for your needs.