Soft Credit Inquiry vs. Hard Credit Inquiry: Understanding the Difference

When it comes to applying for credit, be it a loan, credit card, or mortgage, you may have come across the terms “soft credit inquiry” and “hard credit inquiry.” While these phrases may sound confusing, they refer to two different ways lenders and creditors check your creditworthiness.

Understanding the difference between these two types of credit inquiries is crucial to managing your credit wisely.

In this article, we will explore the distinction between soft and hard credit inquiries, how they impact your credit score, and provide tips for managing them effectively.

The Terminology: Soft vs. Hard Credit Inquiries Checks

Before we delve into the details, let’s clarify the terminology. Various phrases are used to describe credit inquiries, such as:

  • Hard credit inquiry vs. soft credit inquiry
  • Soft credit pull vs. hard credit pull
  • Soft credit check vs. hard credit check

All these terms essentially refer to the same thing: when a lender or creditor checks your credit report. The key difference lies in whether the check is considered “soft” or “hard.”

What’s a Hard Credit Inquiry?

A hard credit inquiry, pull, or check occurs when you officially apply for new credit, such as a credit card, personal loan, mortgage, auto loan, or student loan. Even potential landlords may perform a hard credit check when considering your rental application.

When you apply for credit, the lender or creditor requests your credit score and complete credit history from credit bureaus like Equifax, TransUnion, and Experian. This type of inquiry is called “hard” because it has the potential to impact your credit score. Additionally, hard credit inquiries are recorded on your credit history and remain there for about two years.

It’s important to note that unless someone steals your identity and attempts to open an account in your name, a hard credit inquiry usually occurs when you actively apply for credit. While you may not receive a notification each time a hard credit check happens, it is safe to assume that it will occur when you apply for new credit or a loan.

To maintain a healthy credit score, it’s advisable to avoid multiple hard credit inquiries within a short period of time. However, if you apply for multiple loans of the same type (e.g., home or auto loans) within a specific timeframe, they are typically counted as a single inquiry.

What’s a Soft Credit Inquiry?

On the other hand, a soft credit inquiry occurs in various situations. For instance, when you apply for a pre-approval for a mortgage, a soft credit check takes place. Similarly, when you receive pre-approved credit offers that you didn’t request, it indicates a soft credit pull. Checking your own credit score periodically also leads to a soft credit inquiry. Additionally, your existing creditors may occasionally perform soft credit checks.

Compared to hard inquiries, soft credit inquiries do not affect your credit score. In fact, they can be helpful to you as they allow lenders to assess your creditworthiness without you needing to actively apply for new credit.

Lenders often perform soft credit pulls to gather a pool of qualified candidates for pre-approved offers such as credit cards. So, if you receive credit card offers in the mail, it’s likely that a soft credit pull happened prior to that. However, it’s essential to note that a pre-approval offer does not guarantee approval. If you decide to proceed with the application, a lender will perform a hard credit pull to make a final decision.

Soft credit checks can also happen when you’re checking your credit score. There are many sites you can use to check your credit score for free – and a soft credit check happens anytime you do that.

How Lenders Use Hard and Soft Credit Inquiries

Lenders and creditors employ both hard and soft credit inquiries in different circumstances. Typically, they perform hard credit checks when you directly apply for credit, such as a loan, credit card, refinance, or student loan.

In contrast, lenders generally conduct soft credit checks when you apply for pre-qualification or when they want to identify pre-approved consumers. However, you can also proactively contact lenders to inquire if you prequalify for credit. In such cases, lenders will perform a soft credit check to determine what offers and interest rates you qualify for.

Once you have decided on a specific offer and proceed with the application, a hard credit pull is initiated by the lender.

How Credit Checks Impact Your Credit Score

As mentioned earlier, soft credit inquiries do not affect your credit score. They serve as informational checks that occur without your active credit application.

In contrast, hard credit inquiries can have a minor impact on your credit score. According to MyFICO, a single hard inquiry typically reduces your FICO score by less than five points. However, accumulating multiple hard inquiries within a short duration can result in a more significant negative impact, potentially lowering your score further.

To minimize the effect on your credit score, it’s advisable to conduct your loan shopping within a brief timeframe, ideally a couple of weeks, and avoid varying the type of loans you apply for. Applying for multiple types of credit, such as a car loan, credit card, and mortgage, will negatively impact your credit score each time.

Tips for Managing Credit Inquiries

When engaging in credit shopping or exploring new credit options, keep the following tips in mind:

  • Do Your Research: Before applying for new credit or a line of credit, conduct thorough research. Understand the terms, interest rates, and any potential fees associated with the credit you are considering. This will help you make an informed decision aligned with your financial goals.
  • Use Inquiries Wisely: Utilize soft or hard credit inquiries strategically to assess your options and anticipate the cost of new credit. By doing so, you can gain a realistic understanding of how different credit options may impact your finances.
  • Stick to Your Budget: When evaluating offers and selecting a credit option, consider your budget. Determine what you can afford and ensure you stay within that limit. This approach avoids overspending and the risk of inadvertently damaging your credit score in the process.


Being aware of the difference between soft and hard credit inquiries is essential for managing your credit effectively. Remember that soft credit checks do not impact your credit score and can be helpful in assessing pre-approved offers.

On the other hand, hard credit inquiries can have a minor impact on your credit score, so it’s advisable to avoid excessive hard inquiries within a short period. Take your time, do thorough research, and make informed decisions when navigating the world of credit.

By understanding how credit inquiries work, you can maintain a healthy credit profile and make financial choices that align with your goals.

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