What’s the Difference Between a Hard and Soft Credit Pull?
When applying for a loan or credit card, you’ll likely hear about soft and hard credit pulls (also known as hard and soft credit checks, or hard and soft inquiries). While both types of inquiries provide a look into your credit history, the main difference between a hard and soft credit check is that the former can cause your credit score to decrease while the latter does not.
| Soft credit pulls | Hard credit pulls |
|---|---|
| Performed by creditors to provide preapproved credit offers or as part of a background check | Performed by creditors when you apply for a form of credit |
| Previous soft pulls stay on credit report for up to two years | Previous hard pulls may stay on your credit report for any creditor to see for up to two years |
| May be done without your prior approval | Must have your written approval |
| No impact to your credit score | Can cause your FICO Score to drop by up to five points |
What is a hard credit inquiry?
A hard credit inquiry typically occurs when you apply for a form of credit or a loan. When you apply for a mortgage, for example, there will be a “hard pull” on your credit from the lender, who assesses your credit history when making a decision about whether to approve the loan.
Lenders must get your consent before a hard credit pull, so as long as you’re reading an application’s terms, you’ll know that it’s happening. This is important, because hard credit pulls are one of the factors that can affect your credit score. Hard inquiries stay on your credit report for one to two years, depending on the credit bureau.
Why are hard pulls used?
Hard pulls are typically used by lenders who want to do a thorough review of your credit history, and it indicates that you’re applying for a line of credit. It may be used when you apply for:
- A new credit card
- An auto loan
- A mortgage
What does a hard credit check show?
A hard credit check provides a full view into your credit report and history, including:
- Personal information like your name and date of birth
- Current and previous addresses
- Details of outstanding debt, credit or loan balances
- Debt utilization, comparing available credit against used credit
- Records of missed or late payments over the past six years
- Records of financial events like bankruptcies, foreclosures or repossessions
- Hard credit pulls made over the last two-year period.
- Your account provider and any recent overdrafts
- Your length of credit history, including your borrowing history
- Whether you’re registered on the electoral roll
- The number of new accounts opened
Each credit bureau has their own scoring model, which will generate a credit score based on the above factors.
Hard credit pulls do not show information like your income, bank account balances, overall assets or marital status – which is why many lenders will ask for this information on your application. They also don’t show if anyone has done a soft pull of your credit.
Lenders understand that formal applications are often required to compare rates and offers, so while multiple hard credit pulls in a short period can be seen as a sign of risk, there is a rate-shopping exemption.
This exemption allows multiple credit checks within a 45-day window for mortgages, auto loans and student loans applications to count as a single inquiry for your FICO credit score. For your VantageScore, the rate shopping window is 14 days. This allows borrowers to shop around and find the best rate without impacting their credit.
What is a soft credit inquiry?
A soft credit inquiry may provide a slightly more limited amount of information compared to a hard credit pull, as it’s typically used for one of two purposes. If a company receives limited information to make you a promotional offer, it’s considered a promotional inquiry, while review inquiries are used as part of a screening process.
Soft credit pulls are only visible to you on your credit report, and you can see them for up to two years. They will not impact your score and cannot be seen by lenders or other companies who access your credit report.
Why are soft pulls used?
Soft credit pulls may be used for a number of reasons, including the following
- Lenders want to offer pre-qualifications for credit or loan offers.
- An employer or landlord wants to run a background check.
- You check your own credit score.
- You receive a pre-qualified insurance offer.
- You create an account with a new utility company.
- One of your existing creditors checks your credit, which may happen when they’re assessing your current credit limits or want to extend a new pre-qualification offer.
What do soft pulls show?
Soft pulls allow companies — like banks, landlords, insurance organizations, lenders and utility organizations — to quickly review your basic financial information. Depending on who is checking your credit and what information they’ve requested, a soft credit pull may show:
- Your name, date of birth and home address
- Whether you’re registered on the electoral roll
- Your current credit agreements
- A top-level view of your recent financial history, potentially including missed payments and public record information like bankruptcies
- Your credit score or score range
If a lender wants a complete examination of your entire credit history with the intent of reviewing a funding application, they’ll use a hard pull instead.
Do lenders need my permission to check my credit?
Lenders don’t need your permission for a soft credit check, though they may still sometimes ask for it or alert you that they’ll proceed with a soft pull if you’re applying for prequalification.
Lenders are required to get your permission before a hard credit pull. You’ll typically be asked for your Social Security number, and there will be a clear disclosure informing you that they’ll run your credit if you proceed. In many cases, you’ll be asked for your consent in writing.
What if my credit is pulled without permission?
Regularly checking your credit reports for any errors and unusual hard credit checks can be important for your overall financial health. If a hard pull was performed without your consent, for example, it could be attempted identity theft.
If you find your credit was pulled without your permission, you can:
- Reach out to the creditor. Speak to the creditor directly to learn more. According to the Federal Trade Commission (FTC), 1 in 5 people find errors on their credit report, and a recent study found that 44% of people who checked their credit score found at least one mistake. There is a chance the credit pull was made in error.
- Submit a dispute to the credit bureaus. If you find the credit pull was done in error or without your permission, you can submit a dispute to the credit bureau that reported the inquiry. Typically, the dispute process is completed within 30 days.
- File a complaint. You can submit a complaint to the Consumer Financial Protection Bureau (CFPB) or visit IdentityTheft.gov (which operates under the FTC) if you believe your credit was fraudulently used. The FTC also provides a recovery plan in the case of fraudulent activity.
How to prepare for the impact of a credit check
If you’re concerned about the impact an inquiry on your credit may have on your score, there are a few ways you can minimize the effects.
- Check if you prequalify: An important first step when it comes to shopping around for credit is to confirm if lenders allow you to prequalify. Prequalifying for a credit card or loan with a soft inquiry will not impact your credit. It will also allow you to see what kind of rates, terms, amounts and fees you may receive from a creditor, so you can compare lenders more easily before applying.
- Improve your score: Making sure your credit score is in a healthy place before you apply for credit can not only limit the impact of a credit check but also help you get lower interest rates and better terms. You can consult with a credit counselor who can help you navigate the ins and outs of improving your credit score.
Frequently asked questions
If you have too many hard inquiries on your credit report, it can lower your score.
Each credit bureau tracks hard inquiries for different lengths of time.
FICO tracks hard inquiries for 12 months, and has a 30-day buffer period before counting for student loan, auto loan or home loan applications. They will also deduplicate hard inquiries for these loans within a 45-day period.
Meanwhile, Vantage tracks hard inquiries for 24 months, and will deduplicate most hard inquiries within a 14-day window.
There is no set answer to this question, but it’s important to note that multiple hard inquiries spread out across a period of time can lower your score. This is because credit scoring models — and thus, lenders — typically view multiple credit applications in a short amount of time as a potential sign of a high-risk borrower.
A hard credit pull will typically reduce your score by five or fewer points. Multiple hard credit pulls in a short period of time can have a compounding impact.
No, checking your own credit with credit monitoring tools like LendingTree Spring does not impact your own credit score. You can check your credit score as often as you’d like and even receive alerts when your score changes.
Requesting your own credit report also doesn’t impact your score
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