When you apply for credit, such as a credit card, loan, or mortgage, the lender may conduct a credit inquiry to assess your creditworthiness. There are two types of credit inquiries: hard inquiries and soft inquiries. Understanding the difference between a hard and soft credit inquiry can help you manage your credit and improve your credit score.

1. What is a hard credit inquiry?

A hard credit inquiry, also known as a hard pull, is a credit inquiry that is initiated by a lender when you apply for credit. Hard credit inquiries can affect your credit score because they indicate that you are seeking new credit. Hard credit inquiries remain on your credit report for up to two years and can be seen by other lenders when you apply for credit.

2. What is a soft credit inquiry?

A soft credit inquiry, also known as a soft pull, is a credit inquiry that is not initiated by a lender when you apply for credit. Soft credit inquiries do not affect your credit score and are not visible to other lenders. Examples of soft credit inquiries include when you check your own credit report or when a lender pre-approves you for credit without your permission.

3. How to minimize hard credit inquiries

To minimize the impact of hard credit inquiries on your credit score, it's important to be selective about which credit offers you apply for. Avoid applying for too much new credit at once, as multiple hard credit inquiries can lower your credit score. If you are shopping around for the best credit card or loan offer, try to do it within a short period of time, as multiple credit inquiries for the same type of credit within a short period of time may be treated as a single inquiry by the credit bureaus. You may also want to consider working with a credit repair service, like Credit Bounce, a free credit repair service that can help you manage your credit and improve your credit score. Credit repair services can help you identify and fix errors on your credit report, negotiate with creditors to remove negative information, and provide you with advice and resources to improve your credit score.

By understanding the difference between a hard and soft credit inquiry and taking steps to minimize hard credit inquiries, you can protect your credit score and improve your chances of getting approved for credit. Remember, your credit score is an important factor in your financial health and can impact your ability to get approved for credit, loans, and even rental applications. By managing your credit wisely and working with a credit repair service like Credit Bounce, you can take control of your credit and build a strong financial foundation.