When most people think of a credit check, they think of this vague thing where the someone checking their credit puts in their name and other private information and gets this number along with everything they have ever done wrong financially. However, it’s a little known fact that there are actually two kinds of credit checks: Hard Pulls and Soft Pulls.
So, what is the difference between a Hard Pull and a Soft Pull?
Soft pull
This is a basic inquiry of your credit score, and is meant for informational purposes only. a soft pulls does not show up on your credit report.
Examples of a Soft Pull:
- Checking your own credit
- A lender checking your credit for "pre-approval"
- An employer checking your credit
- A landlord checking your credit
Hard pull
A Hard Pull is the complicated report that gets done when you apply for a loan, mortgage, as well as many other things. This type of credit check can affect your credit score.
Examples of a Hard Pull:
- Credit check when applying for a mortgage
- Credit check when applying for a credit card or signature loan
- Credit check when opening a new checking or savings account
- Credit check when opening a new wireless phone account
- Credit check when you open a new cable television account
The first couple of Hard Pulls don’t really do anything, but after several in a row, it will start to affect your credit score. If you’re opening multiple accounts that require multiple hard pulls, you’re spending a lot more money. If you are already paying on several accounts that you have recently started, how do they know that you’ll be able to continue your payments on another new account? Luckily, this is only 10% of the total calculation of your credit score.
So, what does this all mean to you? First, be aware of how often your credit is bing looked at, and try not to have too many Hard Pulls at the same time. Next, feel free to shop around a bit for the best home loan, but make sure to find out all of the details first and only apply for your top couple of choices. Finally, keep checking your credit report for inacuracies, and report any errors that your find. Checking your own credit does not affect your credit score, and making sure that the information is accurate will help you when you do apply for thos more complicated loans.
phot by: the Italian voice
