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What’s the Difference Between a Hard and Soft Credit Inquiry?

What’s the Difference Between a Hard and Soft Credit Inquiry?

By Jessica Leshnoff • January 11, 2019

Credit can be confusing on its own. Throw in credit language — such as “hard” and “soft” credit inquiries — and you may want to hide under a rock. Or at least under your desk.

But don’t despair! (Or hide!) Here’s a handy guide to break down hard vs. soft credit inquiries so you can feel comfortable with these terms and make the right decisions for your personal finances.

First off, what’s a credit inquiry?

A credit inquiry is a request to see your credit report. Credit scoring systems can consider whether you have applied for credit recently by looking at inquiries on your credit report. Sometimes applying for several different credit cards, for example, in a short amount of time can have a negative effect on a credit score; however, not every inquiry has the same impact on your credit score. Inquiries fall into two categories: hard and soft.1

What’s a hard credit inquiry?

Hard credit inquiries can impact your credit score. They’re typically pulled by lenders when you apply for credit such as an auto loan, personal loan or credit card.

Applying for credit gives a lender authorization to pull your credit, though most lenders will ask for your permission to pull your credit. Lenders and other third parties can see hard inquiries on your credit report.

What’s a soft inquiry?

Soft inquiries are reviews of your credit report that do not impact or change your credit score. They are only visible to you.

Soft inquiries can include inquiries by lenders who are monitoring an existing account, looking at credit reports to make “prescreened” credit offers, or using credit reports to pre-qualify individuals for credit offers. They’re also commonly used for pre-employment background checks. Checking your own credit also results in a soft inquiry being placed on your credit report.

Do hard credit inquiries have a negative impact on credit?

Yes. Hard inquiries can negatively impact a credit score because they represent potential new debt not yet on a credit report. Multiple hard inquiries in a short time may signal a consumer having trouble paying their bills or is at risk of overspending. Some lenders may view this as a potential risk.

However, your overall credit history, including whether you pay your bills on time and your overall debt obligations are just as important. Although hard credit inquiries stay on your credit report for about two years, their significance decreases with time.2 So don’t fret! Everyone has an opportunity to raise their score over time and improve their financial future.

How often should I review my credit report?

Numerous inquiries or errors on your credit report could impact your ability to get credit or a better interest rate. It’s a good idea to proactively check your credit report. Credit bureaus are required to provide you with a free copy of your credit report every 12 months. They also provide credit monitoring services, usually for a fee. You can check with the bureaus for more information.

If you see a hard credit inquiry on your credit report that you didn’t initiate, contact the credit bureau as it could be a sign of fraudulent activity. If it was pulled in error, it can be removed. (You can learn more about fixing common credit report mistakes here.)

Mystery solved!

With the hard vs. soft credit inquiry mystery solved, you’re free to move on to other mysterious (and not-so-mysterious!) credit terms. Armed with working knowledge about credit, and how to get smart about it, you’re ready to take charge of your personal finances.

1. Federal Trade Commission. “Credit Scores.” (accessed November 9, 2017).
2. Experian. “Hard vs. Soft Inquiries on Your Credit Report.” (accessed December 28, 2018).

*This article has been updated from its original posting on November 10, 2017.
Matt Diehl contributed to this article.

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