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What’s the difference between a hard and soft pull?

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And what does it mean for your credit score?

When you apply for a credit — like a credit card or a personal loan — your provider or lender will typically look into your financial history to determine your overall creditworthiness, commonly referred to as a credit pull, inquiry or a credit check.

Two types to know about are a hard pull and a soft pull. The difference lies in how these pulls affect your credit score and how long the inquiry remains on your credit report.

Here’s what to know about these credit checks and how they’re used in the financial industry.

What’s the difference between a hard and soft pull?

  • A creditor conducts a hard pull of your credit history when you apply for financing or credit. This type of inquiry lowers your score, though typically by five points or so, and it can also stay on your credit report for years. You might not notice a credit score drop from 785 to 780, and it likely won’t affect your ability for approval on future credit on its own. But if you apply for many loans and credit cards at once, a cumulative drop from several hard pulls could be more substantial — and could set off alarm bells with banks or creditors who look into you. You can perform a hard pull credit check on your own credit once per year for free, without harming your score.
  • Typically associated with preapprovals, a soft pull of your credit won’t affect your credit score at all. And it’s not just creditors who can conduct one: potential landlords, utility companies and private citizens can take a surface-level look at your credit, excluding in-depth payment history or credit use.

How can multiple credit inquiries hurt my score?

Multiple hard pulls on your credit history can hurt you in a few ways. First, every hard pull takes a few points off of your credit score, and those points add up with each pull. Also, when a potential creditor or lender checks your credit history and sees many hard pulls within a short time, they often interpret the activity as a sign of financial distress.

To them, it indicates that you need money through multiple loans or possibly for debt consolidation. You could simply be in the process of making a financially prudent decision, but it’s inadvertently considered an indication of risk in taking you on as a borrower.

How can I avoid hard inquiries on my credit score?

Avoid hard inquiries by applying only for new credit cards or financing that you think you’re eligible for. Hard pulls are typically tied to these kinds of applications. When applying for any product that requires a credit check, ask which type of pull to expect. By limiting hard pulls on your credit to just a few times a year, and knowing what to expect when you apply for credit, you can ultimately protect your future financial health.

Can I dispute a hard inquiry on my credit report?

No, you can’t dispute a hard inquiry that you’ve authorized. If you see an inquiry on your report that you didn’t authorize, contact the creditor or lender to dispute it. But keep in mind that you might not receive an answer until the inquiry has dropped off your report; these matters can take months to resolve.

This is especially true if the credit reporting agency refuses to remove the hard pull and you have to go through the bank or company that made the hard pull in the first place. The small deduction from a hard inquiry typically affects your credit score during the six months immediately after the hard pull is made, and it fully drops off your credit report after two years.

What’s a credit score good for?

A lot, actually. A high credit score can help you secure financing, get approved for a condo or apartment and get the best rates on credit cards and insurance. It can also add a positive note to an employer’s background check on a candidate.

And if you ever lose your job or find yourself in serious financial hardship, a good credit score affords you a buffer against slight drops that come with late or missed payments without totally sinking into the red zone.

Not only can bad credit hold you back or limit your options for loans or credit cards, but many landlords and apartment management companies also look less favorably on applicants with poor credit. And a low score can also affect the rates you get on insurance or even affect your ability to rent a car, depending on the provider.

Increasing and rebuilding your credit score

While it’s possible for multiple hard pulls to severely affect your credit score, it’s not likely. A low credit score typically indicates ongoing issues with late payments and large loan or credit card balances.

A good start to rebuilding your credit score is to pay off as much of your existing debt as possible through timely payments while avoiding additional debt.

Learn more in our guide to improving your credit, including how you can build your score and increase your financial well-being.

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Bottom line

Your credit score won’t likely nosedive because of a few hard inquiries on your credit. And you shouldn’t let a small potential deduction to your credit score deter you from applying for necessary financing or a credit card with amazing benefits.

But by keeping new credit applications in check and monitoring your credit score, you can balance out your financial priorities with strong credit for your overall financial health.

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