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Hard vs. Soft Credit Pulls: How Each One Affects Your Credit Score


When applying for credit, the lender wants to see your creditworthiness, so they will conduct a credit inquiry. The credit inquiry will review your credit history. 

Your credit history is like a financial report card for lenders. It tells them how responsible you have been with your past debt so they can decide whether to lend you money or not. Your credit history is detailed on your credit report with three nationwide credit bureaus: Equifax, TransUnion, and Experian. 

Credit inquiries will either be a soft inquiry or hard inquiry. A hard inquiry will affect your credit score, and a soft inquiry will not. It’s important you know when these apply so you can maintain or raise your credit score. 

When Should You Expect a Hard vs. Soft Inquiry for Your Credit?

Soft credit inquiries are common and will not affect your credit score. Typically a soft inquiry will occur when: 

  1. You check your credit score through or another free app like CreditKarma, Credit Sesame, or your preferred bank 
  2. You apply for pre-approval with a line of credit 
  3. Lenders conduct a pre-screening for loans 

Hard credit inquiries are significant and will affect your credit score. Some examples of when a hard inquiry may be conducted include: 

  • Applying for a mortgage 
  • Purchasing a car at a dealer with an auto loan 
  • Applying for lease agreements of any kind 
  • Applying for personal loans 

How Do Credit Inquiries Impact Your Credit Score?

According to the Consumer Financial Protection Bureau (CFPB), the reason hard inquiries affect your credit score is that most credit scoring models used by the three main bureaus will account for when you apply for credit and how often you apply for credit. 

For example, in the common FICO credit score model used by many lenders, new credit lines account for 10% of your overall credit score. If you open multiple lines of credit within a short amount of time, it can indicate a larger risk for the lender. This is especially true if you do not have a long-established credit history. 

That said, credit scoring models do consider a variety of other factors in evaluating a credit score. Using the FICO scoring model again, your full credit score is made up of the following components: 

  • 35% = Payment History 
  • 30% = Total Amount Owed 
  • 15% = Length of Credit History 
  • 10% = Credit Mix (i.e. types of credit) 
  • 10%= New Lines of Credit (including inquiries) 

This is important to understand because, as you can see, a history of late payments will have much more of a negative impact on your credit score than applying for a new line of credit and receiving a hard inquiry. 

The Nitty Gritty Details of Hard vs. Soft Credit Inquiries

Because your credit score can allow you to make big financial moves like qualify for a home loan, it’s essential to your overall financial health to be responsible for any debt you choose to take on. Below we dive into some of the nitty-gritty details of credit inquiries. 

Are All Hard Inquiries Treated Equally by the Scoring Models? 

One thing to consider is that these credit scoring models may consider multiple hard inquiries in a short period as a single hard inquiry. 

For example, if you are looking for a home loan you will probably want to shop around and apply at several banks and credit unions to compare rates. According to the CFPB, you have a 45-day window for mortgage applications in which all hard pulls will factor as one on your credit score. If you are shopping for an auto loan, this window of time shrinks to 14 days. Thankfully, this credit score policy will allow you to compare rates and make a sound financial choice without having a huge impact on your credit score. 

How Long Do Hard Inquiries Stay On Your Credit Report? 

Experian states that all hard inquiries stay on an individual’s credit history for two years. As your credit history becomes more varied with a long history and consistent payments, these hard inquiries will decrease in their impact on your overall score. That’s because new lines of credit (i.e. hard inquiries) make up less of your overall score than those other factors. 

Can You Have a Credit Inquiry Removed from Your Credit History? 

You can’t dispute a genuine hard credit inquiry and have it removed from your credit report. However, if you don’t recognize a hard inquiry on your account or a creditor attempted to make a hard inquiry without your permission, this is a major red flag for identity theft. 

You should follow up with immediate action and file a dispute with each of the major three credit bureaus. You will also need to petition each one of them to remove this fraudulent activity from your files. 

4 Tips to Manage Your Credit Inquiries

There are a few simple practices you can implement to keep your credit score growing and your credit inquiries at a minimum:

  1. Only apply for credit when you truly feel like you need it
  2. If you plan to get a loan, shop around for the best rates in a short period
  3. Check your credit report often to ensure you have no fraudulent attempts at a hard inquiry
  4. Pay your bills on time every month and manage how much debt you owe 

As a final tip, always check if an application for a financial product will impact your credit score. 

Finch does not conduct a credit inquiry when you open a new account. Opening an account and banking with Finch does not impact your credit score.

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