Boost Your Credit Score: Understanding the Impact of Hard and Soft Inquiries

Your credit score is a three-digit number that represents your creditworthiness. It is used by lenders and financial institutions to evaluate your ability to repay a loan or credit. A good credit score can open up many opportunities for you, such as getting approved for a mortgage, car loan, or credit card. However, a poor credit score can make it difficult for you to access credit or may lead to higher interest rates.

There are many factors that can affect your credit score, and two of the most important are hard and soft credit inquiries.

A hard credit inquiry occurs when you apply for a loan or credit card. The lender or financial institution will check your credit report to evaluate your creditworthiness. This type of inquiry can have a negative impact on your credit score because it indicates that you are applying for new credit. Hard inquiries stay on your credit report for two years, but they have a small impact on your credit score, usually 5-10 points.

A soft credit inquiry, on the other hand, occurs when a lender or financial institution checks your credit report without your permission. This type of inquiry typically occurs when you are applying for a job, renting an apartment, or applying for insurance. Soft inquiries do not affect your credit score and are not visible to lenders or other third parties who may check your credit report.

Apart from credit inquiry, other factors that can affect your credit score include:

• Payment history: Late payments or missed payments can have a negative impact on your credit score.

• Credit utilization: The amount of credit you are using compared to your credit limit. High credit utilization can indicate that you are overextended and may be a sign of financial distress.

• Length of credit history: The longer your credit history, the better your credit score will be.

• Types of credit: Your credit score may be affected by the types of credit you have, such as credit cards, auto loans, and mortgages.


To maintain a good credit score, it is important to be aware of these factors and to take steps to improve your credit. This includes paying your bills on time, keeping your credit utilization low, and limiting the number of hard inquiries on your credit report. Additionally, monitoring your credit report regularly can help you identify errors or signs of identity theft, which can also affect your credit score.