Hard vs. soft inquiries: which credit checks count against you

Every time anyone looks at your credit file, the bureau logs it. If you pull your full report from all three bureaus, you’ll probably find a long list of company names you never dealt with: card issuers, insurers, your own bank. That list can look alarming, and plenty of people assume each line is costing them points.

Most of it costs you nothing. The bureaus sort every check into one of two buckets, and only one bucket feeds your score. Filter out the soft entries and what’s left is the list that actually matters, which tends to be the one you can explain from memory: the card you applied for, the car you financed.

What turns a credit check into a hard inquiry

A check becomes hard when a company pulls your report because you asked it for credit. You applied for a card, a car loan, a mortgage, a personal loan or a store account, and the lender looked at your file to decide. The Fair Credit Reporting Act lets a bureau release your report to someone who intends to use it “in connection with a credit transaction involving the consumer” (15 U.S.C. 1681b(a)(3)(A)), and your application is what starts that transaction.

Hard inquiries are visible to any lender that pulls your file, and they feed the “new credit” part of a FICO Score, which FICO says makes up about 10% of the score. FICO’s own figure is that for most people one additional inquiry takes fewer than five points off. Hard inquiries stay on the report for up to two years, but FICO Scores only consider them for one.

What counts as a soft inquiry

A soft inquiry is any look at your file that isn’t tied to a credit application you made. The common ones:

• You checking your own credit, through a bureau, a bank app or AnnualCreditReport.com.
• Prescreening, where a lender asks a bureau for a list of people who meet its criteria and mails them offers. The FTC says plainly that prescreening doesn’t hurt your credit score.
• Account reviews, when a company you already have an account with checks your file to decide on a limit change or to monitor risk. The same section of the FCRA that covers new credit also covers “review or collection of an account.”
• Checks that aren’t for credit at all, such as background checks, which myFICO lists among soft inquiries.

Soft inquiries don’t affect FICO Scores, and myFICO says lenders can’t see them. They appear only on the copy of the report that you request, which is why your own report shows far more inquiries than a lender ever will.

Hard or soft: the common situations side by side

The bottom four rows catch people off guard. There’s no federal rule that says a landlord or phone carrier must use a soft check. The company decides how to code the request, and the bureau records it that way.

The gray zones, and how scoring models treat them

When a check could go either way, the scoring model matters too. VantageScore says its models exclude utility inquiries entirely, so a hard pull from a power company shouldn’t move a VantageScore. FICO hasn’t published an equivalent rule on its consumer pages, so don’t assume the same protection on a FICO Score.

Rental applications are the bigger trap. FICO’s rate-shopping protection, which groups several inquiries into one, covers mortgage, auto and student loans only. Five apartment applications that each log a hard inquiry with the same bureau aren’t on that list. Our guide to apartment applications walks through how to keep that count down.

Limit increase requests are the other common gray area. Some issuers use a soft check for a customer-requested increase and some use a hard one, and the answer can depend on the size of the request. The article on limit increase pulls covers how to find out before you click submit.

How to tell which kind you’re about to get

You can almost always find out ahead of time, and you should, because once a hard inquiry is recorded you can’t remove it just because you changed your mind.

1. Read the disclosure next to the submit button. Lenders commonly say “this will not affect your credit score” for soft checks, or describe a “hard inquiry” or “full credit review” for hard ones.
2. If there’s no disclosure, ask the person or the chat agent directly: “Is this a hard inquiry or a soft one?” Write down the answer and the date.
3. Watch for prequalification forms that turn into applications. The first screen may be soft, and a later “accept this offer” step may trigger the hard pull.
4. After you apply, pull your report a few weeks later and confirm the inquiry was coded the way you were told.

If you find a hard inquiry you never authorized, that is a different problem with a different fix, covered in removing inquiries you didn’t authorize.

What to do with this

Stop worrying about soft inquiries entirely. Check your own credit as often as you like, because it’s always soft (we explain why in does checking your own credit lower your score).

For hard inquiries, the useful habit is spacing. Apply when you actually need the credit, group loan shopping into a short window, and ask about the pull type for anything in the gray zones. If you’re planning a big application, such as a mortgage, keep a simple log of every hard inquiry and its date so you know which ones still count. The free inquiry tracker does that math for you, showing when each one stops affecting FICO Scores and when it leaves the report.