Hard Inquiries, Soft Inquiries, and What They Can Actually Do to a Credit Score

Consumers often hear that “checking your credit hurts your score,” but that statement is too broad to be useful. The CFPB explains that there are different types of inquiries, and only some of them are treated as score-affecting events.

Soft inquiries usually do not affect your score

According to the CFPB, soft inquiries can include your own review of your report, account reviews by existing creditors, and certain prescreening activity. These are generally visible to you but not to lenders evaluating a new application.

Hard inquiries are different

Hard inquiries usually occur when you apply for new credit. The CFPB says a single hard inquiry often has only a small effect, but it can still matter, especially when applications are frequent or tightly clustered for different products.

What consumers often miss

The CFPB also notes that certain inquiries of the same loan type made within a limited shopping window may be treated differently by common scoring models. That means rate shopping for a mortgage, auto loan, or student loan is not always treated the same way as repeatedly applying for unrelated lines of credit.

Sources

• CFPB: What is a credit inquiry?
• CFPB: What kind of credit inquiry has no effect on my credit score?