An inquiry is simply a record that someone has looked at your credit report. Inquiries fall into two categories: soft and hard. They are listed in separate sections on the credit report.

Soft Inquiries

Soft inquiries are only shown to you (though there are a couple of exceptions) on your personal credit report and don’t affect credit scores in any way.

Soft inquiries on your credit report are only visible to you, except: (1) insurance companies may be able to see other insurance company inquiries; and (2) inquiries by debt settlement companies you have authorized to access your report may be shared with your current creditors. These inquiries have no effect on your credit score as they are never considered as a factor in credit scoring models. Soft inquiries are not disputable but are available for reference.

Soft inquiries occur when you request your own credit report, when you receive a pre-screened or pre-approved credit card offer or insurance quote, when a lender with whom you already do business does an account review, or for employment verification and background checks.

It’s not uncommon to see multiple soft inquiries in a person’s credit report. If you are not familiar with the name of a company that you see listed in this section, it is likely the result of a pre-approved offer or a company that is doing business under a different name.

Hard Inquiries

Hard inquiries occur when you apply for credit or other goods or services . By applying, you authorize someone else, such as a lender or credit card issuer, to review your credit report. Potential creditors do this to weigh the risk of extending credit to you. The most common hard inquiries occur when you apply for a mortgage, auto loan, student loan, personal or business loan, or a credit card. According to FICO®, a hard inquiry will typically only result in a 5-10 point drop in your credit scores.

Hard inquiries remain on your credit report for two years, but usually only impact your credit scores for a few months. Typically, the impact of a hard inquiry will drop off dramatically after a month or two because there will either be a new account entry, which then becomes the key risk indicator, or there is no new account, which means the inquiry doesn’t represent any risk.

Although too many inquiries within a short period of time can impact credit scores, this is not the case when shopping around for the best rate on a car loan or mortgage. Most credit scoring models are designed to count multiple inquiries made within a certain time frame — usually two weeks — as only one inquiry for purposes of calculating the credit score.

For example, when you apply for a car loan, you or the dealership might contact five competing lenders. All five individual inquires will be part included in your credit report, but they will only be counted as one hard inquiry by credit scores. In fact, the newest credit scoring models may entirely exclude inquiries for auto loans or mortgages.

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  1. Smith, Stacy. (2019) ‘How Many Points Do You Lose from a Soft or Hard Inquiry?’,, 16 April. Available at: [](Accessed:13 June 2019).