What is a hard or soft credit inquiry?

There are two main types of credit inquiries. The biggest difference between the two is that one requires your permission and affects your credit score, the other does not.
The Fair Credit Reporting Act requires credit bureaus to keep a list of both soft and hard inquiries on your credit report. This is so you can be aware of every entity that looks at your credit.

Hard credit inquiry

If you want to take out a loan, open a credit card, or mortgage a house, you’ll eventually be asked to authorize a hard pull on your credit. This allows the company offering financing to take a close look at the details of your payment history, the accounts you have open, and the money you owe to various companies.

Nearly all companies pre-authorize your offer with information from a soft credit inquiry to determine an estimate of your interest rate and terms.

Each hard credit inquiry lowers your FICO credit score by a few points. Don’t be nervous about shopping for a good loan provider when it’s time to buy a home or a car, though. For major purchases, hard credit inquiries made within a 30-day period are grouped together as one. This allows you to avoid being penalized for searching for a company that meets your needs as you search for a lender with the best rates and terms.

Here’s a list of hard credit inquiries that may affect your credit score:

  • Personal loan applications
  • Student loan applications
  • Apartment or house rental applications
  • Credit card applications
  • Store card applications
  • Auto loan applications
  • Mortgage loan applications
  • Second mortgage or home equity line of credit applications

When you ask a company for a loan, they will ask your permission to check your credit to find out how much of a risk you are. If your application is denied, there may only be a soft inquiry that appears on your credit report. If you are unsure about what type of credit inquiry a company will conduct, be sure to ask ahead of time.

Experts say that each hard inquiry lowers your FICO credit score by 2-10 points. That doesn’t seem like a bit deal, but if you apply for several credit cards, authorize a car dealership to pull your credit, and start shopping around for a new apartment within a few months, you could really hurt your score.

Soft credit inquiry

When you receive a pre-approved credit offer or inquire about a loan or credit card, the company conducts a soft pull on your credit. You don’t have to grant them permission. They are looking at a broad overview of your credit to find out whether they should extend you an offer that’s conditional on their final approval. When you check your own credit, it shows up on your credit report as a soft inquiry as well.

Here’s a list of soft credit inquiries that do not hurt your credit score:

  • Insurance companies
  • A self-credit check
  • Pre-approval credit offers
  • Pre-employment credit check
  • Background check
  • Pre-approval for a mortgage loan
  • Identity verification for opening a bank account
  • Rental companies

Check your credit report for unauthorized hard inquiries
If you don’t already have your free copies of your credit reports with Equifax, Experian, and TransUnion, you can access them at This is the only website endorsed by the federal government. There are other services online that also provide you with copies of your credit report, but they charge a subscription fee and their information may be out-of-date.

The soft and hard inquiries are listed at the bottom of your credit report. You’ll see a list of every company or entity that has requested a copy of your credit file from that credit reporting agency.

If your report contains information that is inaccurate, it’s important that you request that the credit reporting agency remove the information. If you think someone or a company has illegally accessed your credit report, contact the credit reporting agency right away for guidance regarding your next steps. Unfamiliar hard inquiries on your credit reports could be a sign of identity theft.

Your credit score determines the interest rate you pay on loans, whether you are approved for a new loan or line of credit, and it even impacts bills like your auto and homeowner’s insurance. Life insurance companies look at credit scores to determine if a person has a tendency toward risky behavior, so a low credit score could cause you to pay more for your life insurance, too.

Keeping a close eye on your credit report and alerting the credit reporting agency to any problems with your report is a responsible thing to do that will help secure your financial future.

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