Woman looking at credit card

Credit Checks: Hard vs. Soft Inquiries

April 10, 2023
Laura PrattBy Laura Pratt
Morningside Branch Manager 

When you apply for a loan or credit card, someone will have to check your credit history before they approve your application. This is so they can judge your ability to pay back the loan.

This check is called a “hard pull” and it's a normal part of your credit file. But you should use these sparingly, because hard credit checks can impact — and even temporarily lower — your credit score.

Luckily, there's another option:  a so-called “soft pull,” which does not affect your credit score. In this article, we'll cover the differences between hard and soft credit pulls.

Hard Inquiries...

Graphic: Hard Credit PullsAre part of getting a loan.

There's no way around it, eventually any lender will make a hard inquiry before approving your loan and giving you the money. These hard pulls are commonly used for final applications for mortgages, auto loans, credit cards, student loans, personal loans and apartment rentals.

Graphic: Credit ReportShow up on your credit report.

Not only will a hard pull show up on your credit report, it will typically remain there for two years. To keep an eye on how a hard inquiry impacts your credit, you can monitor your credit score regularly with tools like the SNB Mobile App.

Graphic: Fair Credit Reporting Act

Require your permission.

Lenders can't just access your credit report without your permission. The Fair Credit Reporting Act says only businesses with a legitimate reason can check your credit, and they must have your consent in writing to do it.

Graphic: Credit ScoreCan lower your score.

It's true, hard credit pulls can lower your credit score, especially if you have too many pulls in a short amount of time. However, doing multiple pulls in a two-week period for the same type of loan — like a mortgage — are viewed as a single pull. So you can still shop around to find the best loan for you.

Soft Inquiries... 

Graphic: Soft Credit CheckAre an alternative to hard inquiries.

These soft pulls show companies exactly what you would see if you pulled your own credit report. These are commonly used when you apply for a job or for an insurance plan; or when a company sends you a “pre-approved offer” for credit. 

Graphic: Consumer DisclosureWill only show up on your “consumer disclosure.”

Unlike hard pulls, soft checks will not show up on your regular credit report. They are, however, visible on consumer disclosures (credit reports that you request personally), so you will be able to tell if a company ran a soft pull on your credit.

Graphic: Pre-Approved Credit OfferDo not require your permission.

Soft credit checks are accessible to companies without your permission, which is why they are used when a company sends you a pre-approved credit offer. But don't worry, it doesn't affect your credit in any way.

Graphic: Credit ScoreWon't negatively affect your credit score.

This is why it's wise to use soft credit checks, and to limit hard credit checks whenever you can. When someone asks to check your credit, be sure to ask if they can use a soft pull unless it is absolutely necessary.

Your credit can have a big impact on your financial life. Credit scores and reports provide a snapshot of the financial habits that financial institutions, cell phone companies, credit card companies, and others use to get a sense of your creditworthiness. A good score can help you get better rates, and save money. 

To learn more, read our blog about how to improve your credit score.

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About the Author

Laura Pratt

Laura Pratt is the Senior Retail Banking Officer at Security National Bank's downtown location. She has more than three decades of banking and lending experience, including 25 years serving customers at SNB.