Soft vs Hard Credit Checks Explained

What is a soft credit inquiry?

A soft inquiry occurs when a lender or service reviews your credit information without initiating a formal credit application. Common examples include prequalification checks, background checks by employers, and credit monitoring services.

Soft inquiries do not affect your credit score. They may appear on your personal credit report for reference, but they are not visible to lenders reviewing your file and carry no scoring impact.

What is a hard credit inquiry?

A hard inquiry occurs when a lender pulls your full credit report as part of a formal application for credit. This happens when you apply for a personal loan, credit card, mortgage, or auto loan.

Hard inquiries can temporarily lower your credit score by a few points, typically 5 to 10 points for most consumers. The impact usually fades within a few months and disappears from your report after two years.

According to Experian, a single hard inquiry rarely has a significant impact on whether you get approved, but multiple hard inquiries in a short period can signal elevated risk to lenders.

Rate shopping and inquiry bundling

If you are shopping for a mortgage, auto loan, or student loan, credit scoring models typically treat multiple inquiries of the same type within a short window of 14 to 45 days as a single inquiry. This allows you to compare offers from multiple lenders without compounding the score impact.

This bundling protection applies to those specific loan types. For personal loans, the treatment may vary depending on the scoring model used by the lender.

How to protect your score while shopping

• Start with lenders that offer soft-pull prequalification so you can see estimated rates without any score impact
• Only submit formal applications to lenders whose terms and eligibility requirements genuinely fit your profile
• Avoid applying for multiple unrelated credit products at the same time
• Check your own credit report before applying so there are no surprises

What Friendly Loans uses

When you submit your information through our platform, we use a soft inquiry to match you with available offers. This means checking your options here will not impact your credit score. If you choose to proceed with a specific lender, that lender may conduct their own inquiry as part of their application process.