It is good to know how to check on your credit so that regular check-ins won’t impact your score and will put you in a position to ensure you are ready to apply for credit, confirm your personal and account information is correct, and to be proactive in detecting signs of identity theft. Regular monitoring of your credit is recommended, so it is good to know what your options are and know the types of credit pulls there are.
Soft Inquiries
There are several different types of credit scores and reports out there which can be confusing. When it comes to pulling your credit and the many options out there, it is good to know who is reputable and who you can trust with your sensitive personal information. It is also good to understand the services and resources available to you regarding your credit so it can help you decide which route is the best for you and your credit goals.
“Soft” inquiries are when you request a copy of your report and score. This type of inquiry is to obtain your credit score and a description of anything going on with your credit such as an overview of your utilization rates as well as negative items such as late payments, charge-offs and your credit history. You can do this directly with any three of the bureaus or with a reputable company such as those we’ve already reviewed on our website.
In this instance, a soft inquiry is specific to a situation when you are NOT applying for credit and these types of inquiries are not visible to potential lenders that may view your credit reports at a later date. These types of inquiries also do not affect your overall score and the information provided can be beneficial to you when you are preparing for a credit purchase.
Although there is not a limit to how many soft inquiries you can make in a certain amount of time, you still need to be careful as some of this information (especially multiple attempts in a short time frame) can show up on your credit history. Paid credit monitoring services will provide this for you, often including helpful information and education all while not affecting your score. These services can also help you understand what the items on your report mean and help you get back on track and/or help you toward your credit goals. These services can also help monitor your credit for anything suspicious and help you guard your personal and private information to give you peace of mind. If you are looking for a guide on how to monitor your credit, check out our Beginners Guide to Monitoring Your Credit.
How to Address Negative Items
If you have negative items impacting your score, credit repair is something that you can consider before applying for credit approval. Taking care of negative items can not only help you get approved, but also help you obtain better interest rates. Credit Repair services ask bureaus and your creditors to verify that negative items on your report are accurate and fair. If they can’t do this or are unable to do it in a timely manner, they are required by law to remove them. Credit Repair companies such as Lexington Law and Credit Saint can also help you in leveraging the laws surrounding credit and help put you in a better position for an approval. Utilizing consumer protection laws can include situations that have affected your credit such as medical bills, divorce, identity theft and more.
Hard Inquiries
“Hard” inquiries occur when you apply for a loan or a credit card and that lender reviews your credit history so that they can decide whether or not to approve your application and if so, the interest rate you will be charged on the loan. This type of inquiry will affect your score, typically by 5 points or so depending on your credit history. A hard credit pull can remain on your credit reports for up to 24 months but usually will only affect your score for about 12 months. If you are looking to apply for a loan, ensure you are obtaining a report and score type that your potential lender will accept so multiple requests do not need to be made. A FICO© score is the most used credit score although your lender may have different requirements. Click here to learn more about hard inquiries in even greater detail.
Bottom Line: Don’t be afraid to check on your credit score and be sure to utilize reputable companies to help keep your credit on track so that when the moment comes to apply for credit, you are ready
