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What Is a Soft Credit Check?
Key takeaways
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Soft credit checks allow you or authorized entities to review information from your credit report without impacting your credit score
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Lenders often use soft inquiries to pre-qualify you for offers or manage existing accounts without affecting credit
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Hard inquiries occur, for example, when you apply for new credit. These could impact your scores
A soft credit check, also known as a "soft pull" or "soft inquiry," happens when you (or an entity you've authorized) reviews information from your credit report.
A soft credit check occurs when you ask for a copy of your credit report. Another example is when a lender does a soft credit check to see if someone might be a good candidate for preapproval on a credit card.
Soft inquiries do not involve an application for a specific form of credit. That's why they don't affect your credit score.
How a soft credit check works
You can initiate a soft credit check by asking one of the three main credit bureaus for a copy of your credit report.
Likewise, credit card companies and other potential lenders can make soft inquiries by contacting the credit bureaus. Landlords, employers, and insurance companies also request information from the credit bureaus to help them screen applicants.
Depending on who is initiating the soft inquiry, the credit bureaus may provide a full credit report or pertinent information from a credit report.
Both types of credit checks return the same information, but the impact on your credit record differs. Let’s do a deep dive into what is a soft pull on your credit report and how it affects your credit score.
Soft credit check vs. hard credit check
While both checks allow a view of your credit history, they have different impacts on your credit score. In this soft vs. hard credit check comparison, we’ll see what other differences exist.
Soft credit check
When a soft credit check happens, it doesn’t signal anything that credit bureaus see as additional credit risk. Here are some essential aspects of a soft credit check:
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Doesn't affect your credit score. Because you're not actively seeking a new source of credit, these checks are ignored by scoring models like FICO® and VantageScore®
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Won't appear to lenders. Soft inquiries are "non-reportable"—they typically can be seen only by you when pulling your own report
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Used for pre-qualification and background checks.Many lenders use soft checks before sending pre-qualified or pre-approved credit card offers. Employer background checks and soft inquiries go hand-in-hand, and insurers also use soft checks to assess someone's financial reliability
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Can happen without your knowledge. Companies may perform soft checks legally without your consent
Hard credit check
Hard inquiries happen when you officially apply for credit, which signals lenders that you're preparing to assume new debt obligations. Here are some things to know about a hard credit check:
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Could temporarily lower your credit score. A hard inquiry typically has a small impact on a credit score that could last for up to a year. Multiple hard checks within a short period may have more impact. Hard inquiries typically stay on your report for up to 2 years
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Visible to lenders reviewing applications. Hard inquiries are visible to anyone viewing your report. Lenders may view frequent hard pulls as a sign that someone could be assuming too much debt
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Used when applying for a loan, credit card, or mortgage. When you apply for these types of credit, lenders typically do a hard pull to assess your creditworthiness
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Requires your permission. Legally, no one can do a hard check without your explicit consent. That's usually done when you sign or submit a credit application
When do soft credit checks happen?
Soft checks occur during routine financial screenings, and typically when you aren't formally requesting a new line of credit. Some examples of soft credit checks are when these happen:
1. Checking your own credit report
Monitoring your own profile is a good idea in general. When you ask for a copy of your credit report through your bank, credit card account, or a place like annualcreditreport.com, it's considered a soft pull. It's a useful financial habit, allowing you to stay informed without penalizing your credit standing. Regular reviews of your credit report help you keep an eye out for errors and unauthorized activity.
2. Pre-qualification for credit cards or loans
When you see ads that say "Check your rate" or "See if you're pre-approved" without affecting your credit score, lenders are probably using soft checks to estimate your eligibility. The pre-approval criteria differ among issuers, touching on scores, payment histories, and other factors. Pre-quals let you shop around for the best terms—without having to commit to a hard inquiry and its possible impact on your credit score.
Employers sometimes do soft checks as part of their hiring process, particularly when a position involves high financial responsibility. Not only do the checks help employers with identity verification, but it also gives them an overview of your general fiscal history. They may look for on-time payment history, bankruptcies, or collection attempts. These checks are only for verification and don't affect your credit score at all.
4. Insurance quotes
When you request a quote for auto or homeowners' insurance, providers might pull a soft check on your credit standing. They may use this to assign a "credit-based insurance score" to help them determine premiums. Insurers believe that people with higher credit scores may be a lower risk for filing claims, so credit reports could affect what premiums you pay.
5. Existing lender account reviews
Banks and other lenders where you currently have a debt account may periodically check your credit to manage their lending risk. These credit checks can help them determine whether to offer you credit limit increases, lower interest rates, or other special offers like balance transfers or a new product.
Do soft credit checks appear on your credit report?
Soft credit checks to do appear on your credit report, but:
- In general, only you can see them.
- Lenders reviewing applications can’t see them.
- They don't impact approval decisions.
From a credit scoring standpoint, soft credit pulls are completely safe.
Do soft credit checks affect your credit score?
Soft credit checks do not affect your credit score. They're "non-reportable inquires," invisible to lenders or credit bureau scoring software. A soft pull bypasses the core components used by credit scoring systems, so there's no impact on those scoring segments. For example, FICO® typically uses these weighted factors to build credit scores:
- Payment history: 35% of score
- Credit utilization: 30% of score
- Credit age: 15% of score
- Credit mix: 10% of score
- New credit: 10% of score
What are the benefits of soft credit checks?
Soft checks offer several useful benefits without causing negative impacts on credit scores.
1. Safe way to check your credit score
Checking your own credit as a soft inquiry is a great way to look over your credit report for errors or unauthorized hard inquiries. These "unknown pulls" can be signs of identity theft—so report inconsistencies to the responsible credit bureau. Correcting errors in your credit report also could help to improve your credit score.
2. Risk-free pre-qualification
2. Make multiple payments per month
Credit utilization is calculated based on the outstanding balance as of the close of the statement period. Making multiple payments before the statement closing date can help to bring down credit utilization.
3. Helpful for budgeting and planning
Knowing your credit standing helps you plan for big purchases, like for a car or home. Preauthorization helps you to see a realistic preview of available interest rates, to estimate monthly payments, and to plan long-term savings goals.
4. Useful for identity verification
Many companies (banks, mobile phones, utilities) use soft checks to confirm an applicant's identity during the account opening process. This provides a layer of security for both you and them.
When is a hard credit check required?
When you apply for these types of credit, lenders typically do a hard credit check:
- Credit cards
- Auto loans
- Personal loans
- Student loans
- Mortgages
- Lines of credit
FAQs
Soft credit checks have no impact on your credit score. Credit scoring models, such as FICO® and VantageScore®, are programmed to disregard soft checks as they aren't tied to a request for new credit. You can check your own report at Equifax®, TransUnion®, and Experian® without any negative credit consequences.
A soft inquiry is typically for informational purposes and doesn't affect your score. A hard inquiry happens when you formally apply for credit and could temporarily lower a FICO® score by several points. A hard pull's impact varies depending on the individual account credit history and other factors.
Yes. Many promotional or background checks automatically use soft pulls to verify creditworthiness. But under the Fair Credit Reporting Act (FCRA), soft checks must be for "permissible purposes," like pre-approval offers or reviews of existing accounts.
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