What Is a Hard Inquiry?
Let me explain what a hard inquiry is—it's when a lender asks for your full credit report from a credit bureau. This usually happens when you apply for a loan or some other credit, and it can cause a small, temporary drop in your credit score. You might hear it called a hard pull or hard credit check.
Key Takeaways
- A hard inquiry is a lender's request for your credit report after you apply for credit.
- It can lead to a small, brief decrease in your credit score.
- Soft inquiries occur when a lender or business pulls your report on their own, without your application.
How a Hard Inquiry Works
When you apply for a loan, line of credit, or credit card, the lender typically requests your credit report from one or more of the three major bureaus: Equifax, Experian, and TransUnion.
These bureaus get their data from your current and past creditors. Not all creditors report to every bureau, and some don't report at all, so your reports can differ between them. For big loans like mortgages, lenders might pull all three to get a complete view.
These requests are hard inquiries. They get noted on your credit report and cause a small score drop. They stay on your report for two years but stop affecting your score after one year.
If you have several hard inquiries in a short time, lenders might see it as a sign you're desperate for money, and your score could drop more significantly.
That said, lenders and scoring models make exceptions. For instance, most FICO scores ignore multiple inquiries from auto, mortgage, or student loan lenders within a short period, treating them as one. In the latest FICO models, that period is 45 days.
As the Consumer Financial Protection Bureau points out, the impact is the same regardless of how many lenders you check with, as long as it's within 45 days of the first check. Even after that, an extra inquiry's effect is minor, and shopping around can save you money long-term.
FICO also ignores inquiries for those loan types made in the 30 days before scoring, so if you secure a loan within 30 days, they won't hurt your score during rate shopping.
The logic here is that you're likely seeking one loan at the best terms, not multiple loans simultaneously.
Remember, unlike hard inquiries, soft ones don't affect your credit score at all.
Hard Inquiry vs. Soft Inquiry
Besides hard inquiries, lenders and businesses can make soft inquiries to access your credit report. These aren't triggered by your credit application, and you might not even know about them.
Examples include your current creditors checking your file, or potential lenders prescreening for credit card offers. Pulling your own report is also a soft inquiry.
If your employer or a potential one requests your report, that's soft too, but they'll need your written permission first, so you'll know.
Soft inquiries don't impact your credit score. They might show on your report, but only you can see them, according to TransUnion.
Other Information Lenders May Request
Your credit report has plenty about your credit use, but it doesn't cover everything a lender might want. For example, it lacks your income, investments, or assets like bank accounts. Lenders get that from your application and documents like pay stubs, tax forms, or statements.
It also omits personal details like marital status, education, or medical history.
Plus, your credit score isn't in the report—lenders request that separately.
Who Can Request Your Credit Report?
Access to your credit report is regulated by the Fair Credit Reporting Act. The Consumer Financial Protection Bureau states that agencies can share your info only with those who have a valid need, like considering your application for credit, insurance, employment, housing, or business. Employers usually need your written permission.
How Can You Request Your Credit Report?
By law, you get a free copy from each of the three major bureaus once a year via AnnualCreditReport.com. If you spot errors, especially damaging ones, dispute them with the bureau—they must investigate and report back.
How Can You Prevent Prescreening?
Prescreening leads to soft inquiries, but if you want to stop it for privacy or to cut junk mail, opt out at OptOutPrescreen.com.
What Is a Credit Freeze?
A credit freeze blocks third parties from accessing your report, with some exceptions. You can request one for free, but contact each bureau separately.
The Bottom Line
Hard inquiries occur when you apply for credit and a lender pulls your report. They can negatively affect your score, but the impact is usually small and short-lived—don't let it stop you from applying when you need credit.
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