What’s the Difference Between “Hard” Credit Pulls and “Soft” Credit Pulls?

A "pull" on your credit report is when someone looks at your credit history and views your credit score. There are two types of pulls, or inquiries, that can be made on your credit — a hard pull and a soft pull, and there is a major difference between the two.

What difference does it make whether you have a hard pull or a soft pull on your credit, and why should you care? A hard pull will actually reduce your credit score, while a soft pull will not.

Hard Credit Inquiries

Hard pulls on your credit report are the inquiries you want to keep track of and be aware of. They reduce your credit score. When you apply for credit, you give permission to the lender to pull a copy of your credit history and/or credit score, in order to determine whether or not you qualify for credit. When a company checks your credit, the hard-pull inquiry will remain on the report issued through all three credit bureaus for other potential lenders to see for a period of one to two years. Each hard pull will also lower your credit score up to five points and keep it lowered for six months or so! Think about this the next time you apply for credit.

The following situations result in a hard inquiry to your credit report:

• Applications for any new credit; credit cards, loans, mortgages, etc.
• Opening a bank account
• Activation of pre-approved credit card offers

Soft Credit Inquiries

Any inquiry made to your credit report that doesn’t affect your credit score is considered a soft pull. Most of the time, when your credit is looked at, you aren’t even aware that it’s happened! Every time a company reviews your credit history, a notation is made in the file that you can see (but other lenders viewing your credit history or score would not see the soft inquiries made to your credit).

There are a number of situations that would result in a soft pull, including:

• Credit card lenders who make initial credit report checks in order to send out pre-approved credit offers
• Pre-approvals for mortgages and loans
• Any credit report or credit score you request on your own
• Background investigations by potential employers or landlords
• Credit report checks by companies you already have accounts with, including credit card or insurance firms

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