Hard Credit Pull vs Soft Credit Pull [Infographic]

  • August 2nd, 2011
  • Dan Bischoff

Only 31% of men and 26% of women know the difference between hard and soft credit pulls. The biggest difference?

Hard credit pulls will ding your credit. Soft credit pulls will not.

Small business loans can often require multiple inquiries depending where you go, and that’s a big deal. If someone asks to pull your credit, this graphic will help you understand what you’re getting into.

small business loans hard credit pull vs soft


Hard Credit Pull

    • Only occurs when you apply for credit
    • Occurs when one of your existing creditors decides to pull it (at any time, for any reason, without new permission). It’s common when reviewing your account for a credit line increase.
    • Will have a (slight) negative effect on your overall score
    • Records of these inquiries will remain with you for 2 years, but only negatively affect your credit for 1 year

Small Business Loans Made Simple

Create a Free Lendio Account

  • The adverse impact from a hard inquiry lasts 1 year, but most of the adverse effect disappears after the first 90 days
  • The higher the credit score when pulled, the steeper the drop
  • Multiple mortgage inquiries in 45 day window from first to last have the same impact on score regardless of how many inquiries occurred
  • Multiple auto loan inquiries in 30 day window from first to last have the same impact on score regardless of how many inquiries occurred
  • Unsecured credit inquiries like personal credit cards and in-store credit have the most adverse impact on score
  • Some loan applications will result in an automatic turndown if too many inquiries are present, regardless of the strength of the rest of the loan application
  • Can be pulled by any party with permissible purpose under the FCRA


  • Applications for a new credit card
  • Requests to activate a pre-approved credit card offer
  • Activations of new cell phone contracts
  • Opening a new bank checking or savings account at some institutions

Soft Credit Pull

  • Includes voluntary and involuntary inquiries
  • Typically occurs when applying for a new job, new apartment, etc.
  • Will NOT affect your credit score
  • Will not be visible to other individuals or institutions pulling your credit
  • Occurs anytime you check your own credit
  • Most current creditors do a soft pull instead of new hard pulls
  • Existing creditors usually do a soft pull at least monthly, some weekly, and some almost daily
  • Credit inquiries not related to new credit issuance (employment, apartment rental, credit monitoring), but sometimes mistakenly show up as hard inquiries
  • Only visible to you and the bureaus, not creditors


  • Background checks by potential employers
  • Verification of your identity by banks
  • Initial credit checks by credit card companies that want to solicit you for a pre-approved credit card
  • Initial credit checks by mortgage companies to pre-approve you for a loan


  • The credit scoring model ignores credit inquiries made within a certain window. This window ranges from 14 days to 45 days depending on the version of the credit score that’s being used
  • Just 31% of the population knew a credit score could change 5+ times a year
  • Only 14% of consumers could identify factors that affect their credit score
  • Just 26% of women and 31% of men knew the difference between “hard” and “soft” credit inquiries

Who Can Access Your Credit Report

  • Lenders
  • Credit card companies
  • Utility and cell phone companies
  • Employers, landlords and insurers
  • Court agencies, child support agencies and collection agencies
  • You

SEE ALSO: Learn How to Build Your Business Credit Score

Permissible Purpose

Anyone with “Permissible Purpose” as defined by the FCRA can pull your credit. Here are the permissible purpose categories:

  • Responding to the order of a court (happens when people get divorced, apply for BK protection, etc.)
  • In accordance with the permission of the consumer to whom it relates. (Most people mistakenly think this is the only scenario wherein their credit can be pulled, yet it’s just one of many.)
  • In connection with issuance of new credit
  • In connection with collection of existing credit obligations
  • Review of existing credit obligations
  • For employment purposes
  • Underwriting of insurance (of any type)
  • Issuance of any type of license or other benefit granted by a governmental instrumentality
  • Valuation by a third party of existing debt obligation
  • Has an otherwise legitimate business need for the information because of a business transaction that is initiated by the consumer or to review a business account
  • Any child support enforcement agency, public or private

Lendio’s mission is to fuel the American Dream by making small business loans simple through options, speed, and trust. Whether you are looking for a business line of credit or a startup loan, Lendio offers hundreds of different loan products from a variety of lenders. Find out which business loan is best for you.

About the Author

  • Dan Bischoff


  1. In regards to Soft Pulls, can a company pull my CR’s over 50 times since last Feb.? If so, don’t they have to have both my permission and especially a reason to pull that many times?

    I signed up for a 14 day trial to a credit monitoring service but after 3 days decided to cancel. This company also verified the date I started and cancelled (spoke with 3 different reps.!). But, since then even they do not know why their system is still pulling my CR’s. Even after I spoke with someone from their head office, my CR’s were pulled another 5 times.

    My main question now is, is this an FCRA violation? I did request for them to stop membership and this is in their system. I would really like this to stop because there is no reason for them to continually pull my CR’s… I was told that this could end up being a very costly error on their part, to the tune of $50k +! Are they correct?