When it comes to credit inquiries, there are two main types: hard inquiries and soft inquiries. Understanding the difference between the two can help you better understand how credit inquiries can impact your credit score.
A hard inquiry, also known as a hard pull, is a request for your credit report by a lender or creditor when you apply for credit. Hard inquiries are recorded on your credit report and can potentially have a negative impact on your credit score.
Hard inquiries occur when you apply for credit, such as a loan or credit card, and the lender or creditor reviews your credit report to assess your creditworthiness and determine whether to approve your application. Multiple hard inquiries in a short period of time can lower your credit score, as they can signal to lenders and creditors that you are seeking a lot of credit, which could be perceived as risky.
On the other hand, a soft inquiry, also known as a soft pull, is a request for your credit report by someone other than a lender or creditor. Soft inquiries do not impact your credit score and are not visible to other lenders and creditors.
Examples of soft inquiries include when you request your own credit report, when a company checks your credit as part of a background check for employment or rental application, or when you are pre-approved for a credit card offer.
In summary, a hard inquiry is a request for your credit report by a lender or creditor when you apply for credit, and it can potentially have a negative impact on your credit score. A soft inquiry is a request for your credit report by someone other than a lender or creditor, and it does not impact your credit score.
