In some professions you may be required to have a background check performed. it is a process that will check the background of a person, usually to ensure they are reliable and trustworthy. This may involve a soft credit check (or soft credit inquiry) that checks your credit history. The process of a soft credit check will not affect your credit score because it is a soft pull not a hard pull.
What are Soft Inquiries?
You can request a copy of your credit report for Free once every 12 months from each of the three credit bureaus. Go to https://Annualcreditreport.com to get a free copy. This is considered a soft credit pull or soft inquiry. You can check it yourself to see if you have any issues.
Remember You will only be able to view your credit report not your scores!
Your credit is not entirely your own to manage
There are many companies that perform a soft credit check on your behalf without your knowledge.
Some lenders like the ones we work with will also check your credit history as part of a soft credit check. Other examples of soft credit checks include leasing an apartment or opening a bank account.
What Does A Soft Credit Report Show?
A soft credit check shows some of the same things as a hard credit check in that it can give a glimpse into your creditworthiness. Most of the time, the individual or company will request specific information from your credit report. This could include your payment history and any loans or debt that you have.
A soft credit check doesn’t require you to give away your personal information or reveal your credit score. However, it may give the lender the right to ask you for more information, which could include your credit score.
Hard Credit Check vs Soft credit check
If you get a hard credit inquiry, you will be notified by your credit card company and you will have a negative impact on your credit score. A soft credit check will not have this effect.
Soft inquiries are typically used to prescreen you for a job offer or other types of offers where you may be extended credit or a loan.
Hard inquiries are typically used when applying (not pre-qualifying) for any type of loan and can have a negative impact on your FICO® Score.
A hard pull can initially take up to five points off your FICO® Score and remain visible on your report for about two years.
A hard credit check is a credit check that is conducted by a lender or a creditor with your knowledge and authorization. The purpose of a hard credit check is to determine your credit history and your ability to repay a loan.
Will a soft credit check affect your Score?
A soft inquiry is a term used to describe when you are browsing for a loan but the inquiry has no affect on your overall credit score. In the same manner, checking your credit score is a soft inquiry.
When Is A Credit Check Required?
A soft credit check is rarely done without a good reason for doing so. Lenders can quickly get you pre-qualified.
A hard credit inquiry is never done without your consent and is typically only pulled by a credit card company or lender when it is in their best interest to do so.
What Can I Do About Soft Inquires On My Report?
If you find out that a soft credit inquiry has been made on your credit report, you can notify the credit card company and ask them to remove the inquiry.
A good way to always know your credit status
If you check your credit regularly you are in a good position to stay on top of your financial health. Checking your credit is a great way to do this.
If you get a credit card offer in the mail, it is because they performed a soft credit check and pre-qualified you. And yes they can do this without your consent. They’ll send you these offers with the option to apply.
It is common practice for them to run a soft credit check on applicants and sometimes periodically.
If you have a good credit history, don’t worry and relax. A soft credit check is a very low risk activity to your credit score and doesn’t affect it in any way.
Performing your own soft credit check can help you build a solid credit history without causing any damage to your score.