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Using credit cards or the decision to get them or not can be confusing and overwhelming. We could never know enough tips and tricks on the best ways to use credit cards and to ensure we do not make mistakes that could lead us into deep financial trouble.
In simple terms, credit card inquiries are requests made by businesses to check information on your credit from an agency specialized in credit reporting either as a standard business practice or because you applied for a new line of credit. Inquiries are classed into two groups, hard and soft therefore, this guide will help you have a better understanding of the two branches credit inquiries and why they may be coming up on your credit report and potentially preventing you from obtaining new forms of credit or better rates on the lines that you would otherwise be able to obtain effortlessly.
Hard Inquiry
A hard inquiry, otherwise known as a hard pull, normallytypically takes place when a prospective lender or issuer requests to review your credit report. These generally show the card user’s history in terms ofregarding having applied for credit it having been for a loan, a mortgage or a credit card. Possible lenders ask for this data in order to make an informed decision on whether it would be advisable to do so. Commonly, you must allow them to go through.
On the other hand, hard inquiries can lower your credit score between five to ten points. Because of this, it is importantessential that you arebe careful when applying for credit and how many times you apply for it. Each hard inquiry that is made will be added to your report and will stay there for a minimum of two years.
Soft Inquiry
Soft inquiries are also identified as soft pulls. Differently, to hard pulls, these do not produce any changes to your credit scores. Soft inquiries actually happen most often without you knowing. In fact, every time you get a credit card offer in the mail, it’sit is probably because the credit card company requested a soft inquiry; it wouldn’twould not make sense for card companies to invest in customers that aren’t likely to buy into their product. Soft Credit Inquiries, normallyusually happen when a lender or company reviews your credit record as a background check. Employers can also ask for soft pulls. Soft inquiries are most likely to occur when you are pre-approved by a lender for a loan or for a credit card. This is a way for lenders to say that you’reyou are being considered and likely to get approved for the loan.
You can also check your own credit through a soft inquiry which is handy because it will not drop your score. Plus, keeping track of your own credit history on a regular basis is a goodan excellent strategy to reveal any chances or fraud.
All in all, hard or soft inquiries are nothing to be afraid of, especially if you are well informed and aware of all the instances that can happen during your credit card use. This guide has covered the basics of all you need to know about inquiries, so next time you find yourself in a situation where they’rethey are present, you’llyou will know what to do, what to ask, and most importantly not to worry.
This article was written for Grand Teton Professionals for Inquiry Busters. For Credit Repair Solutions and Support, please contact us at 203-599-4157 or email us at Support@InquiryBusters.com. For Media Relations, please contact Misty.Burrell@GrandTetonProfessionals.com