A hard inquiry is a type of inquiry on your credit report that could potentially affect your credit score. Your credit score is one of the most important numbers that you have, and keeping it high is critical if you want to save money on interest. A hard inquiry occurs when you apply for credit or some type of loan. Here are the basics of a hard inquiry on your credit report.

Hard and Soft Inquiries

There are two types of inquiries that can occur on your credit report, both "soft" and "hard" inquiries. A soft inquiry occurs when a company wants to send out promotional materials to a prequalified group of individuals. This type of inquiry does not necessarily give the party a great deal of information about yourself. It is only a basic look at your credit score or history. A hard inquiry is a type of inquiry that is used to get detailed information on your credit report. This type of inquiry happens when you fill out a credit application for a credit card, apply for a car loan or try to get a mortgage. When this happens, the lender will look at your entire credit report, and this will be documented on your credit history. Inquiries on your credit report are very detailed. You will have an inquiry show up even if you simply ask to get a copy of your credit report. 

How Long They Last

Once a hard inquiry makes it onto your credit report, it will stay there for a certain amount of time. Hard inquiries are required to remain on your credit report for at least one year. In most cases, they will stay on your report for at least two years. After that, they are removed from your report. 

Potential Damage

If you have a large number of hard inquiries on your credit report, this can negatively affect your credit score. The more people that look at your credit, the more your credit score will decrease. This means that you need to be very careful how often you check your credit. Even though it may lower your credit score by only a few points, it will still affect it. If you are trying to get a loan, this could cost you some money in interest.

Frequency

Not all hard inquiries will affect your credit score in the same way. Some of them are more damaging to your credit than others. If you are shopping for a loan, the credit score formula will account for shopping around. If you get a mortgage or loan, the credit score model will ignore inquiries that occur within a 30-day period of that loan. This means that even if you get 20 hard inquiries within that time period, they will not count against you. If you get a hard inquiry every few months, this will be more damaging to your credit report.

 



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