Soft inquiries on your credit report have no effect on your credit score. However, hard inquiries can hurt your score.
When you or a potential lender does a soft inquiry, your credit score is safe since you're not applying for a loan or credit.
When a lender checks your credit score as part of a credit application you've made, it is considered a hard inquiry.
This can cause a small drop in your credit score for a few months but stay on your report for at least two years.
Soft inquiries can take place in these scenarios: When you check your credit report, your score is not affected at all.
When your current creditor or lender is keeping tabs on your finances, it is not a new lender. It does not hurt your score.
The company that has your current auto insurance policy may do a soft check to adjust your annual premiums.
When you fill out a credit card application or loan application, a hard inquiry is done to pull your credit report.
When you request for a credit line increase from an existing lender, they will pull a hard check to see if you qualify.