“Hard” vs. “Soft” Inquiries

There are two types of credit inquiries: “hard” and “soft”. Only hard inquiries hurt your credit score. Hard inquiries result from potential lenders pulling your credit report when you apply for credit with them. The following are all examples of soft inquiries: you pulling your own credit report; a potential employer checking your credit; and credit card companies inquiring on your report to see if you are eligible for promotional offers (if you want to prevent them from doing that, call 1-888-8-OPTOUT). Creditors that you have a current relationship with may also monitor your credit by pulling your report from time to time; this would also be a soft inquiry.

How Hard Inquiries Affect Your Credit Score

It has been estimated that each hard inquiry lowers your credit score by 5 points. Most inquiries will stay on your credit report for 1 to 2 years.

The exception is if you’re shopping around for a mortgage or auto loan. In that case, any hard inquiries for the same type of credit occurring within 14 days of each other will only count as one inquiry as far as your credit score is concerned. But remember, this only applies to home and auto loans, not to credit card or any other type of inquiries!

Unauthorized Inquiries

The Fair Credit Reporting Act (FCRA) requires that whoever pulls your credit report does so only with permissible purpose. So if you see any inquiries on your report that you don’t recall authorizing, you should dispute them.

The best way to dispute an inquiry is to send a letter to the creditor in question stating that you do not recall authorizing them to pull your credit report. Ask them to either provide you with proof that they had permissible purpose to inquire on your report, or delete the inquiry. Send the letter certified mail with return receipt requested, and keep copies for your records.

In the event that the creditor doesn’t respond to your dispute or fails to delete the inquiry without providing proof of permissible purpose, you will need to dispute the listing with the credit bureau and send them a copy of the letter you sent to the creditor.

If you have any questions about inquiries on your credit report, please feel free to comment.

Post from: Credit Repair and Debt Solutions

Inquiries On Your Credit Report

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1. Medical Debts Listed on Your Credit Report
2. How To Repair Your Own Credit Report – Part 2
3. Understanding Your Credit Score