The Difference Between a Hard & Soft Credit Pull

When you apply for a loan or financing, the lender will typically check your credit. But not all credit checks are the same. There are two types of credit checks: hard pulls and soft pulls. Understanding the difference between these two types of credit checks is important, as they can have different impacts on your credit score.

What is a Hard Credit Pull?

A hard credit pull, also known as a hard inquiry, occurs when a lender or creditor checks your credit report as part of a lending decision. Hard pulls can occur when you apply for a mortgage, auto loan, personal loan, or credit card. Hard pulls can have a negative impact on your credit score, typically reducing it by a few points. Multiple hard pulls in a short period of time can have a more significant impact on your credit score.

What is a Soft Credit Pull?

A soft credit pull, also known as a soft inquiry, occurs when a person or company checks your credit report for purposes other than lending decisions. Soft pulls can occur when you check your own credit report, when a company checks your credit for a background check, or when a lender checks your credit to pre-approve you for an offer. Soft pulls do not impact your credit score.

Why Does it Matter?

Understanding the difference between hard and soft credit pulls is important because it can help you manage your credit score. If you're shopping for a loan, try to do your research before applying to minimize the number of hard pulls on your credit report.