When navigating financial decisions, understanding how different types of credit inquiries affect your credit score is essential. Here’s a breakdown of “soft” and “hard” credit pulls, what they mean for your score, and tips to keep your credit healthy.
Soft Pull: Checking Your Own Credit
A soft pull occurs when you check your own credit report. Here are some key things to know:
- No Impact on Your Score: You won’t lose points by reviewing your own credit report.
- Doesn’t Appear on Credit Report: Soft pulls won’t show up as inquiries on your report, so you’re free to check it multiple times without worry.
- Great for Monitoring: Soft pulls are ideal for keeping an eye on your credit health. However, the scores you see may be higher than your “real” score because they’re typically Vantage scores, which can differ from FICO scores that most lenders use.
Hard Pull: For Loans and Major Credit Decisions
A hard pull, on the other hand, is initiated when a lender reviews your credit for a loan application, such as for a home, car, or personal loan.
- Small Score Impact: Expect to see up to a 3-point reduction in your score after a hard pull.
- Visible on Credit Report: A hard pull is noted on your report and stays there for up to two years.
- Accurate FICO Scores: Hard pulls reveal FICO scores, which lenders consider the most accurate and are generally used to determine loan approvals.
Applying for a Loan? Take Note!
When shopping around for loans, it’s good to know that credit bureaus allow a “shopping window” of 30-45 days. During this period, multiple hard pulls for the same type of loan won’t hurt your score repeatedly—they’ll only count as a single inquiry.
Key Takeaway
While soft pulls are great for monitoring, a lender’s hard pull will give you the most accurate picture of your FICO score and where you stand for loan approval. Allow your lender to pull your credit so you have the correct information and can confidently plan your next steps forward.
