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font-14 my-10"><a href="/money/hard-vs-soft-credit-check#ref2252857-1">Introduction</a></li><li class="link-black font-14 my-10"><a href="/money/hard-vs-soft-credit-check#ref385986">What is a hard credit check?</a></li><li class="link-black font-14 my-10"><a href="/money/hard-vs-soft-credit-check#ref385987">What is a soft credit check?</a></li><li class="link-black font-14 my-10"><a href="/money/hard-vs-soft-credit-check#ref385988">Hard vs. soft credit check: What’s the impact on your credit score?</a></li><li class="link-black font-14 my-10"><a href="/money/hard-vs-soft-credit-check#ref385989">Tips for a good credit score</a></li><li class="link-black font-14 my-10"><a href="/money/hard-vs-soft-credit-check#ref385990">The bottom line</a></li><li class="link-black font-14 my-10"><a href="/money/hard-vs-soft-credit-check#ref2252857-references">References</a></li></ul><div class="font-14 font-weight-bold mt-20">Read More</div><div class="TableOfContents_RelatedArticle__yK5m6" data-testid="RelatedContents"><a href="/money/good-debt-vs-bad-debt" class="link-black" data-testid="RelatedContent-1-2234792-1"><div class="card card-sm card-horizontal my-15" data-testid="Card"><div class="card-media" data-testid="CardMedia" style="aspect-ratio:50/40"><img loading="lazy" src="https://cdn.britannica.com/55/235555-050-522F6A92/Good-Debt-Bad-Debt-composite-image-home-buyers-shoppers.jpg?c=crop&h=40&w=50" alt="Good Debt Bad Debt, composite image: home buyers, shoppers" data-testid="IrisImage"/></div><div class="card-body" data-testid="CardBody"><div class="font-14">Good debt vs. bad debt: It’s all about targeting your goals</div></div></div></a><a href="/money/what-is-buy-now-pay-later" class="link-black" data-testid="RelatedContent-1-2234769-1"><div class="card card-sm card-horizontal my-15" data-testid="Card"><div class="card-media" data-testid="CardMedia" style="aspect-ratio:50/40"><img loading="lazy" src="https://cdn.britannica.com/63/238263-050-D335A107/BNPL-Buy-now-pay-later-online-shopping-concept.jpg?c=crop&h=40&w=50" alt="Photo of a phone displaying the words "Buy now, pay later."" data-testid="IrisImage"/></div><div class="card-body" data-testid="CardBody"><div class="font-14">What is buy now, pay later and should you take advantage of it?</div></div></div></a><a href="/money/what-is-chapter-13-bankruptcy" class="link-black" data-testid="RelatedContent-1-2234709-1"><div class="card card-sm card-horizontal my-15" data-testid="Card"><div class="card-media" data-testid="CardMedia" style="aspect-ratio:50/40"><img loading="lazy" src="https://cdn.britannica.com/78/249678-050-92D6F8EE/chapter-13-bankruptcy-printed-in-text-on-page-as-visual-aid-or-business-law-reference.jpg?c=crop&h=40&w=50" alt="Chapter 13 bankruptcy printed in text on a page." data-testid="IrisImage"/></div><div class="card-body" data-testid="CardBody"><div class="font-14">Facing a financial quagmire? Chapter 13 can help you create a repayment plan</div></div></div></a></div></div><button class="btn btn-outline-undefined TableOfContents_MobileTableOfContentsButton__dHpRi d-md-none mb-20 w-100 d-none" data-testid="MobileTableOfContents" type="button" aria-label="Table Of Contents" style="--category-color:var(--blue)"><svg stroke="currentColor" fill="currentColor" stroke-width="0" viewBox="0 0 24 24" height="1em" width="1em" xmlns="http://www.w3.org/2000/svg"><path fill="none" d="M0 0h24v24H0V0z"></path><path d="M4 10.5c-.83 0-1.5.67-1.5 1.5s.67 1.5 1.5 1.5 1.5-.67 1.5-1.5-.67-1.5-1.5-1.5zm0-6c-.83 0-1.5.67-1.5 1.5S3.17 7.5 4 7.5 5.5 6.83 5.5 6 4.83 4.5 4 4.5zm0 12c-.83 0-1.5.68-1.5 1.5s.68 1.5 1.5 1.5 1.5-.68 1.5-1.5-.67-1.5-1.5-1.5zM7 19h14v-2H7v2zm0-6h14v-2H7v2zm0-8v2h14V5H7z"></path></svg><span class="font-18 ml-5">Table Of Contents</span></button><span hidden="" style="position:fixed;top:1px;left:1px;width:1px;height:0;padding:0;margin:-1px;overflow:hidden;clip:rect(0, 0, 0, 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3.61.82L8.6 22.5l3.4-1.47 3.4 1.46 1.89-3.19 3.61-.82-.34-3.69L23 12zm-12.91 4.72-3.8-3.81 1.48-1.48 2.32 2.33 5.85-5.87 1.48 1.48-7.33 7.35z"></path></svg>Cite</button><span hidden="" style="position:fixed;top:1px;left:1px;width:1px;height:0;padding:0;margin:-1px;overflow:hidden;clip:rect(0, 0, 0, 0);white-space:nowrap;border-width:0;display:none"></span><button class="btn btn-outline-blue btn-xs py-5 px-10 shadow-sm mr-5" data-testid="ArticleUtilityBar-Share" type="button" aria-label="Share"><svg stroke="currentColor" fill="currentColor" stroke-width="0" viewBox="0 0 24 24" class="ArticleUtilityBar_UtilityButtonIcon__6w04y mr-5" height="1em" width="1em" xmlns="http://www.w3.org/2000/svg"><path fill="none" d="M0 0h24v24H0z"></path><path d="M18 16.08c-.76 0-1.44.3-1.96.77L8.91 12.7c.05-.23.09-.46.09-.7s-.04-.47-.09-.7l7.05-4.11c.54.5 1.25.81 2.04.81 1.66 0 3-1.34 3-3s-1.34-3-3-3-3 1.34-3 3c0 .24.04.47.09.7L8.04 9.81C7.5 9.31 6.79 9 6 9c-1.66 0-3 1.34-3 3s1.34 3 3 3c.79 0 1.5-.31 2.04-.81l7.12 4.16c-.05.21-.08.43-.08.65 0 1.61 1.31 2.92 2.92 2.92 1.61 0 2.92-1.31 2.92-2.92s-1.31-2.92-2.92-2.92z"></path></svg>Share</button><span hidden="" style="position:fixed;top:1px;left:1px;width:1px;height:0;padding:0;margin:-1px;overflow:hidden;clip:rect(0, 0, 0, 0);white-space:nowrap;border-width:0;display:none"></span></div><div class="" data-testid="BylinesWrapper"><strong class="font-12 mr-5 text-center">Written by</strong><span class="mr-5" data-testid="Byline"><span class="Byline_popoverTrigger__xVs4j font-14" id="_R1jiksvf7ksq">Miranda Marquit</span></span><div class="popover AuthorPopover_AuthorPopover__0W0b4" data-testid="Popover"><a class="font-weight-semi-bold" href="/money/author/miranda-marquit/12867794">Miranda Marquit</a><div class="AuthorPopover_shortBio__1tFaf mt-5 font-14 font-serif text-gray-700 line-clamp clamp-4"><span style="font-weight: 400;">Miranda is an award-winning freelancer who has covered various financial markets and topics since 2006. In addition to writing about personal finance, investing, college planning, student loans, insurance, and other money-related topics, Miranda is an avid podcaster and co-hosts the Money Talks News podcast.</span></div><div data-popper-arrow="true"></div></div></div><strong class="font-12 mr-5">Fact-checked by</strong><span class="mr-5" data-testid="Byline"><span class="Byline_popoverTrigger__xVs4j font-14" id="_R1liksvf7ksq">David Schepp</span></span><div class="popover AuthorPopover_AuthorPopover__0W0b4" data-testid="Popover"><a class="font-weight-semi-bold" href="/money/author/david-schepp/12995277">David Schepp</a><div class="AuthorPopover_shortBio__1tFaf mt-5 font-14 font-serif text-gray-700 line-clamp clamp-4">David Schepp is a veteran financial journalist with more than two decades of experience in financial news editing and reporting for print, digital, and multimedia publications.</div><div data-popper-arrow="true"></div></div><div class="caption mt-5 d-flex" data-testid="ContentDateAndHistory"><span>Updated: <time dateTime="Nov. 19, 2024">Nov. 19, 2024</time></span></div></div><div class="TableOfContents_TableOfContents__g8WLR d-none" data-testid="TableOfContents"><div class="font-16 font-weight-bold">Table of Contents</div><hr class="mt-0"/><ul class="TableOfContents_TableOfContentsList__yU1tL p-0 mt-0 mb-0 list-unstyled pl-5" style="--category-color:var(--blue)"><li class="link-black font-14 my-10"><a href="/money/hard-vs-soft-credit-check#ref2252857-1">Introduction</a></li><li class="link-black font-14 my-10"><a href="/money/hard-vs-soft-credit-check#ref385986">What is a hard credit check?</a></li><li class="link-black font-14 my-10"><a href="/money/hard-vs-soft-credit-check#ref385987">What is a soft credit check?</a></li><li class="link-black font-14 my-10"><a href="/money/hard-vs-soft-credit-check#ref385988">Hard vs. soft credit check: What’s the impact on your credit score?</a></li><li class="link-black font-14 my-10"><a href="/money/hard-vs-soft-credit-check#ref385989">Tips for a good credit score</a></li><li class="link-black font-14 my-10"><a href="/money/hard-vs-soft-credit-check#ref385990">The bottom line</a></li><li class="link-black font-14 my-10"><a href="/money/hard-vs-soft-credit-check#ref2252857-references">References</a></li></ul><div class="font-14 font-weight-bold mt-20">Read More</div><div class="TableOfContents_RelatedArticle__yK5m6" data-testid="RelatedContents"><a href="/money/good-debt-vs-bad-debt" class="link-black" data-testid="RelatedContent-1-2234792-1"><div class="card card-sm card-horizontal my-15" data-testid="Card"><div class="card-media" data-testid="CardMedia" style="aspect-ratio:50/40"><img loading="lazy" src="https://cdn.britannica.com/55/235555-050-522F6A92/Good-Debt-Bad-Debt-composite-image-home-buyers-shoppers.jpg?c=crop&h=40&w=50" alt="Good Debt Bad Debt, composite image: home buyers, shoppers" data-testid="IrisImage"/></div><div class="card-body" data-testid="CardBody"><div class="font-14">Good debt vs. bad debt: It’s all about targeting your goals</div></div></div></a><a href="/money/what-is-buy-now-pay-later" class="link-black" data-testid="RelatedContent-1-2234769-1"><div class="card card-sm card-horizontal my-15" data-testid="Card"><div class="card-media" data-testid="CardMedia" style="aspect-ratio:50/40"><img loading="lazy" src="https://cdn.britannica.com/63/238263-050-D335A107/BNPL-Buy-now-pay-later-online-shopping-concept.jpg?c=crop&h=40&w=50" alt="Photo of a phone displaying the words "Buy now, pay later."" data-testid="IrisImage"/></div><div class="card-body" data-testid="CardBody"><div class="font-14">What is buy now, pay later and should you take advantage of it?</div></div></div></a><a href="/money/what-is-chapter-13-bankruptcy" class="link-black" data-testid="RelatedContent-1-2234709-1"><div class="card card-sm card-horizontal my-15" data-testid="Card"><div class="card-media" data-testid="CardMedia" style="aspect-ratio:50/40"><img loading="lazy" src="https://cdn.britannica.com/78/249678-050-92D6F8EE/chapter-13-bankruptcy-printed-in-text-on-page-as-visual-aid-or-business-law-reference.jpg?c=crop&h=40&w=50" alt="Chapter 13 bankruptcy printed in text on a page." data-testid="IrisImage"/></div><div class="card-body" data-testid="CardBody"><div class="font-14">Facing a financial quagmire? Chapter 13 can help you create a repayment plan</div></div></div></a></div></div><button class="btn btn-outline-undefined TableOfContents_MobileTableOfContentsButton__dHpRi d-md-none mb-20 w-100" data-testid="MobileTableOfContents" type="button" aria-label="Table Of Contents" style="--category-color:var(--blue)"><svg stroke="currentColor" fill="currentColor" stroke-width="0" viewBox="0 0 24 24" height="1em" width="1em" xmlns="http://www.w3.org/2000/svg"><path fill="none" d="M0 0h24v24H0V0z"></path><path d="M4 10.5c-.83 0-1.5.67-1.5 1.5s.67 1.5 1.5 1.5 1.5-.67 1.5-1.5-.67-1.5-1.5-1.5zm0-6c-.83 0-1.5.67-1.5 1.5S3.17 7.5 4 7.5 5.5 6.83 5.5 6 4.83 4.5 4 4.5zm0 12c-.83 0-1.5.68-1.5 1.5s.68 1.5 1.5 1.5 1.5-.68 1.5-1.5-.67-1.5-1.5-1.5zM7 19h14v-2H7v2zm0-6h14v-2H7v2zm0-8v2h14V5H7z"></path></svg><span class="font-18 ml-5">Table Of Contents</span></button><span hidden="" style="position:fixed;top:1px;left:1px;width:1px;height:0;padding:0;margin:-1px;overflow:hidden;clip:rect(0, 0, 0, 0);white-space:nowrap;border-width:0;display:none"></span><div class="font-serif font-18 lh-lg dropCapArticle"><div class="Article_floatedHeroComponents__8_NjL"><div class="mb-10 BorderlessCard_BorderlessCard__u5tTW d-inline-block w-100 pb-0 rounded border p-10" data-testid="BorderlessCard"><div class="w-100 position-relative d-flex"><img loading="eager" src="https://cdn.britannica.com/72/261772-004-ADD80A6B/Hard-and-Soft-Credit-Pulls-photo-illustration-image-Hands-pulling-tractoron-table-by-rope.jpg?w=385" alt="Photo illustration of hands pulling on a rope attached to a small tractor on a table." width="385" data-testid="IrisImage" class="border rounded w-100"/><button class="btn btn-outline-blue-dark btn-xl btn-circle CircleIconButton_CircleIconButton__HkIE0 position-absolute bottom-10 right-10 bg-white" data-testid="CircleIconButton" type="button" aria-label="Open full size image" id="_Rcksvf7ksq"><svg stroke="currentColor" fill="currentColor" stroke-width="0" viewBox="0 0 24 24" height="1em" width="1em" xmlns="http://www.w3.org/2000/svg"><path fill="none" d="M0 0h24v24H0V0z"></path><path d="M15.5 14h-.79l-.28-.27A6.471 6.471 0 0 0 16 9.5 6.5 6.5 0 1 0 9.5 16c1.61 0 3.09-.59 4.23-1.57l.27.28v.79l5 4.99L20.49 19l-4.99-5zm-6 0C7.01 14 5 11.99 5 9.5S7.01 5 9.5 5 14 7.01 14 9.5 11.99 14 9.5 14z"></path><path d="M12 10h-2v2H9v-2H7V9h2V7h1v2h2v1z"></path></svg></button><div class="tooltip font-16" data-testid="Tooltip">Open full sized image<div data-popper-arrow="true"></div></div></div><div class="font-serif text-gray-700 mt-5 font-14 text-left">What happens when they pull your credit?</div><div class="font-serif text-gray-700 mt-5 font-12 font-italic mb-10 text-left">© DragonImages/stock.adobe.com, © stefan1179/stock.adobe.com, © Stockistock/stock.adobe.com; Photo illustration Encyclopædia Britannica, Inc.</div></div></div><div class="mb-20 font-sans-serif"><div class="label mb-5 font-weight-bold text-hr text-hr-right font-14">Recent News</div><div class="mt-5 d-flex flex-column" data-testid="RecentNews-Item-3894104"><span class="font-12"><time class="mr-5" dateTime="Nov. 16, 2024, 2:17 AM UTC">Nov. 16, 2024, 2:17 AM UTC</time>(USA Today)</span><a href="https://www.usatoday.com/story/news/health/2024/11/15/medical-debt-credit-score-rule/75775370007/" class="d-block font-14 gtm-ap-news-link font-weight-semi-bold">Unpaid medical debt can ruin your credit. A proposed remedy is in sight.</a></div></div><section class="HTMLContent_HTMLContent__cOyPs" data-testid="HTMLContent"><span id="ref2252857-1" data-level="1" /><p><a href="/money/what-is-due-diligence">Shopping for a loan</a>? A lender may advise that you can get <a href="/money/qualifying-for-mortgage">prequalified</a> with a soft credit check. This inquiry provides general information about your credit history and won’t affect your <a href="/money/what-is-a-credit-score">credit score</a>. But once you submit a formal credit application—even if it’s just for a branded credit card at your favorite retailer—you’ll be subject to a hard check, and that can <a href="/money/how-to-raise-your-credit-score">hurt your credit score</a>.</p></section><section class="HTMLContent_HTMLContent__cOyPs" data-testid="HTMLContent"><p>Understanding how a hard credit check differs from a soft one can help you decide when to <a href="/money/good-debt-vs-bad-debt">apply for debt</a> and how to avoid negatively affecting your credit when searching for the best <a href="/money/consumer-credit">loan</a> or <a href="/money/understanding-credit-cards">credit card</a> deal.</p></section><div class="card CalloutCard_CalloutCard__Uy03G my-20 font-sans-serif" data-testid="CalloutCard"><div class="card-body" data-testid="CardBody"><h2 class="font-16 font-weight-bold">Key Points</h2><div class="font-14"><ul data-listtype="UL"><li data-itemtype="LI">Soft credit checks don’t affect your credit score; lenders use them to advise what you might qualify for.</li><li data-itemtype="LI">A hard credit check is performed when you submit an official loan or credit card application and can have a negative effect on your credit score.</li><li data-itemtype="LI">When you’re shopping for the best deal, multiple inquiries in a short period usually count as a single credit check. </li></ul></div></div></div><section class="HTMLContent_HTMLContent__cOyPs" data-testid="HTMLContent"><span id="ref385986" data-level="1" /><h2 class="h2">What is a hard credit check?</h2><p>Typically, lenders perform a hard credit check, also called a hard credit inquiry or “pull,” after you’ve submitted an official application for debt.</p></section><div class="Assemblies_assemblyItemWrapper__siPLQ align-middle Assemblies_singleAssembly__V5KfU"><div class="mb-10 BorderlessCard_BorderlessCard__u5tTW d-inline-block w-100 pb-0 rounded border p-10" data-testid="BorderlessCard"><div class="ArticleVideo_articleVideo__bEkBl border rounded overflow-hidden" data-testid="ArticleVideo"><div id="jwplayer-9"></div></div><div class="font-serif text-gray-700 mt-5 font-14 text-left">The difference between good debt and bad debt</div><div class="font-serif text-gray-700 mt-5 font-12 font-italic mb-10 text-left">Encyclopædia Britannica, Inc.</div></div></div><section class="HTMLContent_HTMLContent__cOyPs" data-testid="HTMLContent"><p>With a hard credit check, the <a href="/money/bank">bank</a> or other lender looks at a version of your <a href="/money/credit-score">credit score</a> that’s tailored to a specific situation. It differs from the consumer score you see when you check your own score. This hard credit inquiry <a href="/money/debt-collection-on-credit-report">provides information the lender can use</a> to determine whether you qualify for a loan. It’s used to <a href="/money/how-interest-rates-work">set your interest rate</a> and other terms.</p><span id="ref385987" data-level="1" /><h2 class="h2">What is a soft credit check?</h2><p>A soft credit check doesn’t usually affect your credit score. Many lenders do a soft credit pull to show you what you <em>might</em> qualify for and the rate you could reasonably expect to get.</p><p>When you’re <a href="/money/what-is-due-diligence">shopping around for the best deal on a loan</a>, keep these tips in mind:</p><ul data-listtype="UL"><li data-itemtype="LI"><strong>Verify that it’s a soft credit inquiry.</strong> Double-check the fine print and confirm you’re getting a soft credit check that won’t affect your credit score.</li><li data-itemtype="LI"><strong>Compare multiple lenders.</strong> Check three to five lenders’ potential rates and terms to determine which offers the best deal.</li><li data-itemtype="LI"><strong>Know that the offer isn’t official until you apply and get a hard credit check.</strong> A soft credit inquiry isn’t sufficient to approve your loan or finalize the terms. The lender makes a final decision based on the results of a hard credit inquiry. </li></ul><p>A soft credit check can help you learn where you stand with specific lenders creditwise and what you might reasonably expect. This information can be especially useful if you’re in the beginning stages of <a href="/money/common-mortgage-terms">getting a mortgage</a> and want a ballpark figure of how much you can borrow and <a href="/money/fixed-vs-variable-rate-mortgage">what your rate and payment might be</a>.</p><p>But it’s not the final say, and you’ll need a hard credit check to get a <a href="/money/qualifying-for-mortgage">mortgage preapproval</a> or the <a href="/money/financing-a-car">final terms on a car loan</a>, <a href="/money/payday-loans-title-loans">personal loan</a>, or <a href="/money/credit-card-companies">credit card</a>.</p><span id="ref385988" data-level="1" /><h2 class="h2">Hard vs. soft credit check: What’s the impact on your credit score?</h2><p>The main difference between a hard and soft credit check is its effect on your credit score. A hard credit inquiry will affect your score, but depending on your situation, it’s unlikely to have a big impact. Many consumers find that a hard inquiry typically results in a drop of less than 5 points in their credit scores.</p></section><div class="card CalloutCard_CalloutCard__Uy03G my-20 font-sans-serif" data-testid="CalloutCard"><div class="card-body" data-testid="CardBody"><h2 class="font-16 font-weight-bold">How multiple hard checks affect your credit score</h2><div class="font-14"><p>Certain types of loans, such as <a href="/money/fixed-vs-variable-rate-mortgage">mortgages</a>, <a href="/money/financing-a-car">car loans</a>, and <a href="/money/federal-vs-private-student-loans">student loans</a>, require comparison. If you have multiple hard inquiries within 14, 30, or 45 days (depending on <a href="/money/big-three-credit-reporting-agencies">which scoring model</a> the lender uses), all credit checks related to one type of loan are bundled and considered a single inquiry.</p></div></div></div><section class="HTMLContent_HTMLContent__cOyPs" data-testid="HTMLContent"><p>But multiple hard credit checks within a short time can significantly affect your credit score. Lenders view this activity as a signal that you may be taking on substantial debt, which makes having you as a customer riskier. For example, <a href="/money/best-rewards-credit-card-cash-back">applying for several credit cards</a> within a few months can negatively affect your credit score more than a single inquiry for a <a href="/money/pros-and-cons-of-debt-consolidation">personal loan</a>. </p><p>A soft credit check, on the other hand, doesn’t affect your credit score. Again, read the fine print before getting a rate quote to determine whether you’re authorizing a hard or soft credit check.</p><span id="ref385989" data-level="1" /><h2 class="h2">Tips for a good credit score</h2><p>If you maintain a good credit score, you shouldn’t have to worry about a couple of hard credit inquiries ruining your chances of a loan later. Your score will likely return to its previous level in a few months. With good credit, a ding caused by a credit inquiry won’t put you out of the running for other financial products and services.</p><p>Follow these tips to keep your score in tip-top shape:</p><ul data-listtype="UL"><li data-itemtype="LI"><strong>Pay on time.</strong> <a href="/money/setting-monthly-budget">Paying bills when they’re due</a> is the best way to preserve your credit score. Because payment history is the most important factor, it benefits your score.</li><li data-itemtype="LI"><strong>Keep your credit utilization low.</strong> <a href="/money/credit-cards-and-credit-scores">If you have credit cards, pay them off each month</a>. If you do carry a balance, keep it to 30% or less of your available credit.</li><li data-itemtype="LI"><strong>Dispute errors when you find them.</strong> Check your credit report a few times each year to ensure it’s accurate. If you find a problem, follow the credit reporting agency’s dispute process.</li></ul><span id="ref385990" data-level="1" /><h2 class="h2">The bottom line</h2><p>When you’re applying for a loan or credit card, know the difference between a hard and soft credit check to avoid unintentionally decreasing your credit score.</p><p>A soft credit check is used for prequalification and allows lenders to review your eligibility without affecting your credit score. The information provided from a soft check can help you find the best loan terms. Submitting a formal loan application triggers a hard credit check; this provides the lender with a more detailed credit score to determine the loan terms it can offer you.</p><p>A hard check typically has little impact on your credit score, but several of them within a short period can lower your score significantly. To maintain a good credit score, <a href="/money/automatic-bill-pay">pay your bills on time</a>, keep your credit utilization low, and regularly check your credit report for errors. These practices help minimize the impact of hard inquiries on your credit.</p></section><section class="HTMLContent_HTMLContent__cOyPs" data-testid="HTMLContent"><h2 class="h2">References</h2><span id="ref2252857-references"/></section><section class="HTMLContent_HTMLContent__cOyPs" data-testid="HTMLContent"><ul data-listtype="UL"><li data-itemtype="LI"><a class="external" target="_blank" rel="noopener" href="https://www.consumerfinance.gov/ask-cfpb/whats-a-credit-inquiry-en-1317/">What’s a Credit Inquiry?</a> | consumerfinance.gov</li></ul></section></div></div><aside class="d-none d-lg-block cm-right-rail col-da-320 z-1" data-testid="RightRail"></aside></div><div data-page-index="1" data-testid="PageSentinel"></div></div></main><footer class="Footer_Footer__h6k1G text-align-center pb-100" data-testid="Footer"><div class="pt-30 pt-md-40 mx-25 mx-md-0"><a href="/money"><img loading="lazy" src="https://cdn.britannica.com/money/assets/Money-475x60-footer-2x.png?h=47&w=390" 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Home buying and selling, taking out a mortgage or home loan, remodeling, and other home-related decisions require education and planning.\",\"imageUrl\":\"https://cdn.britannica.com/22/235622-159-A518C19F/britannica-money-default-subject-logo-home-finance.jpg\",\"categoryIcon\":{\"name\":\"MdLocalOffer\",\"color\":\"blue\"},\"slug\":\"Mortgage-Home\",\"url\":\"/browse/Mortgage-Home\"},{\"id\":13308,\"parentId\":13300,\"title\":\"Taxes\",\"description\":\"You probably know Ben Franklin's adage about death and taxes, but back in Ben's day, taxes weren't nearly as numerous—nor as complex. Learn about taxes on income, capital gains, property, sales, and more.\",\"imageUrl\":\"https://cdn.britannica.com/22/235622-159-A518C19F/britannica-money-default-subject-logo-home-finance.jpg\",\"categoryIcon\":{\"name\":\"MdLocalOffer\",\"color\":\"blue\"},\"slug\":\"Household-Taxes\",\"url\":\"/browse/Household-Taxes\"}]},{\"category\":{\"id\":13100,\"parentId\":13000,\"title\":\"Investing\",\"description\":\"Investing is about identifying opportunities for long-term growth of your portfolio. Stocks, bonds, mutual funds, ETFs, and alternative investments such as commodities and real estate, are part of a vast market ecosystem.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdShowChart\",\"color\":\"orange\"},\"slug\":\"investing\",\"url\":\"/browse/investing\"},\"subcategories\":[{\"id\":13110,\"parentId\":13100,\"title\":\"Alternative Investments\",\"description\":\"alts\\\") would be everything else. Learn about commodities, precious metals, derivatives, real estate, art, and collectibles—and the institutional traders and fund managers who invest in them.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdShowChart\",\"color\":\"orange\"},\"slug\":\"Alternative-Investments\",\"url\":\"/browse/Alternative-Investments\"},{\"id\":13111,\"parentId\":13100,\"title\":\"Bonds \u0026 Fixed Income\",\"description\":\"A diversified investment portfolio typically includes bonds and other fixed-income securities. But like all invements, fixed income has its share of product types, risks, and complexities that are worth exploring and understanding.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdShowChart\",\"color\":\"orange\"},\"slug\":\"Bonds-Fixed-Income\",\"url\":\"/browse/Bonds-Fixed-Income\"},{\"id\":13113,\"parentId\":13100,\"title\":\"ETFs \u0026 Mutual Funds\",\"description\":\"Exchange-traded funds (ETFs) and mutual funds are baskets of stocks, bonds, and other securities. A fund may track an index such as the S\u0026P 500, or it may be tied to a sector, industry, risk profile, or strategy.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdShowChart\",\"color\":\"orange\"},\"slug\":\"ETFs-Mutual-Funds\",\"url\":\"/browse/ETFs-Mutual-Funds\"},{\"id\":13112,\"parentId\":13100,\"title\":\"Economic Data\",\"description\":\"No exploration of investment opportunies is complete without context of the economic realities of the day. Economic data includes government reports such as GDP, unemployment, inflation, and housing numbers, as well as trends in fiscal and monetary policy.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdShowChart\",\"color\":\"orange\"},\"slug\":\"Economic-Data\",\"url\":\"/browse/Economic-Data\"},{\"id\":13114,\"parentId\":13100,\"title\":\"Fundamental Analysis\",\"description\":\"Does a specific stock deserve a place in your portfolio? Due diligence starts with fundamental analysis: Earnings and earnings ratios, financial statements, growth and growth potential, and the competitive environment.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdShowChart\",\"color\":\"orange\"},\"slug\":\"Fundamental-Analysis\",\"url\":\"/browse/Fundamental-Analysis\"},{\"id\":13115,\"parentId\":13100,\"title\":\"Markets \u0026 Regulation\",\"description\":\"Modern financial markets are relatively easy to navigate, but amazingly complex when you dig beneath the surface. Learn how markets work, who the players are, how money and securities change hands, and how the system is regulated.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdShowChart\",\"color\":\"orange\"},\"slug\":\"Markets-Regulation\",\"url\":\"/browse/Markets-Regulation\"},{\"id\":13116,\"parentId\":13100,\"title\":\"Portfolio Management\",\"description\":\"Your portfolio is the amalgamation of all your assets—stocks, bonds, real estate, the funds in your 401(k), and your cash. A well-managed portfolio will aim for solid long-term returns—adjusted for your risk tolerance and time horizon—and will shift along with your changing objectives.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdShowChart\",\"color\":\"orange\"},\"slug\":\"Portfolio-Management\",\"url\":\"/browse/Portfolio-Management\"},{\"id\":13117,\"parentId\":13100,\"title\":\"Stocks \u0026 Indexes\",\"description\":\"A stock represents partial ownership of a company, and a stock index tracks a basket of stocks of different companies. Learn the ins and outs of the stock market, the 11 sectors within it, and the various indexes that measure its overall performance.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdShowChart\",\"color\":\"orange\"},\"slug\":\"Stocks-Indexes\",\"url\":\"/browse/Stocks-Indexes\"}]},{\"category\":{\"id\":13400,\"parentId\":13000,\"title\":\"Trading\",\"description\":\"Trading is the short-term buying and selling of stocks, commodities, options, cryptocurrencies, and other securities. Trading has different objectives and strategies than long-term investing. Traders use technical analysis, buy and sell on margin, and look to capture price inefficiencies.\",\"imageUrl\":\"https://cdn.britannica.com/21/235621-159-24129B3B/britannica-money-default-subject-logo-retirement.jpg\",\"categoryIcon\":{\"name\":\"MdOutlineToll\",\"color\":\"violet-strong\"},\"slug\":\"Trading\",\"url\":\"/browse/Trading\"},\"subcategories\":[{\"id\":13401,\"parentId\":13400,\"title\":\"Crypto \u0026 Foreign Exchange\",\"description\":\"Active trading in foreign exchange (“forex”) has been around for decades, while cryptocurrencies are relative newcomers. Both track the relative value of currencies or cryptocurrencies: dollars, euro, yen, and pounds as well as Bitcoin, Ethereum, Solana, and Dogecoin.\",\"imageUrl\":\"https://cdn.britannica.com/21/235621-159-24129B3B/britannica-money-default-subject-logo-retirement.jpg\",\"categoryIcon\":{\"name\":\"MdOutlineToll\",\"color\":\"violet-strong\"},\"slug\":\"Crypto-Foreign-Exchange\",\"url\":\"/browse/Crypto-Foreign-Exchange\"},{\"id\":13402,\"parentId\":13400,\"title\":\"Futures \u0026 Margin Trading\",\"description\":\"Futures contracts allow traders and investors to speculate on the direction of—and hedge underlying positions in—stock indexes, interest rates, commodities, precious metals, and more.\",\"imageUrl\":\"https://cdn.britannica.com/21/235621-159-24129B3B/britannica-money-default-subject-logo-retirement.jpg\",\"categoryIcon\":{\"name\":\"MdOutlineToll\",\"color\":\"violet-strong\"},\"slug\":\"Futures-Margin-Trading\",\"url\":\"/browse/Futures-Margin-Trading\"},{\"id\":13403,\"parentId\":13400,\"title\":\"Options Trading\",\"description\":\"Options are derivative contracts that give the buyer the right to buy or sell a security at a specific price. Options can be flexible and capital efficient. But understanding the math behind them, plus the lingo, strategies, and risk parameters, requires some training.\",\"imageUrl\":\"https://cdn.britannica.com/21/235621-159-24129B3B/britannica-money-default-subject-logo-retirement.jpg\",\"categoryIcon\":{\"name\":\"MdOutlineToll\",\"color\":\"violet-strong\"},\"slug\":\"Options-Trading\",\"url\":\"/browse/Options-Trading\"},{\"id\":13404,\"parentId\":13400,\"title\":\"Technical Analysis\",\"description\":\"Is there predictive power in price and volume data? Technical analysts watch the charts, look for patterns, and use a blend of art and science to try to optimize the timing and price levels for buy and sell orders.\",\"imageUrl\":\"https://cdn.britannica.com/21/235621-159-24129B3B/britannica-money-default-subject-logo-retirement.jpg\",\"categoryIcon\":{\"name\":\"MdOutlineToll\",\"color\":\"violet-strong\"},\"slug\":\"Technical-Analysis\",\"url\":\"/browse/Technical-Analysis\"},{\"id\":13405,\"parentId\":13400,\"title\":\"Trading Strategy\",\"description\":\"Active trading requires some specialized skill—and a special mindset. Learn how to manage capital and trading positions, as well as emotions and biases. \",\"imageUrl\":\"https://cdn.britannica.com/21/235621-159-24129B3B/britannica-money-default-subject-logo-retirement.jpg\",\"categoryIcon\":{\"name\":\"MdOutlineToll\",\"color\":\"violet-strong\"},\"slug\":\"Trading-Strategy\",\"url\":\"/browse/Trading-Strategy\"}]},{\"category\":{\"id\":13200,\"parentId\":13000,\"title\":\"Retirement\",\"description\":\"We all dream of a comfortable retirement. Learn all about the various retirement savings accounts and how to maximize them. Careful planning of your retirement income, budget, and lifestyle can help make sure you don't outlive your money.\",\"imageUrl\":\"https://cdn.britannica.com/21/235621-159-24129B3B/britannica-money-default-subject-logo-retirement.jpg\",\"categoryIcon\":{\"name\":\"MdSavings\",\"color\":\"green\"},\"slug\":\"retirement\",\"url\":\"/browse/retirement\"},\"subcategories\":[{\"id\":13201,\"parentId\":13200,\"title\":\"Defined Contribution Plans\",\"description\":\"401(k) plans and individual retirement accounts (IRAs) are examples of defined contribution plans. You decide how much to contribute, and those savings are invested to compound and (hopefully) capture market earnings. 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Pretty much anyone with assets, families, and even pets should have plans in place—just in case.\",\"imageUrl\":\"https://cdn.britannica.com/21/235621-159-24129B3B/britannica-money-default-subject-logo-retirement.jpg\",\"categoryIcon\":{\"name\":\"MdSavings\",\"color\":\"green\"},\"slug\":\"Estate-Planning\",\"url\":\"/browse/Estate-Planning\"},{\"id\":13203,\"parentId\":13200,\"title\":\"Pensions \u0026 Annuities\",\"description\":\"An annuity is a series of payments made at fixed, regular intervals. Defined benefit plans (such as government and company pension plans) are one type of annuity. Insurance companies also sell annuity products that are designed to offer predictable income streams in retirement. But fair warning: they're complex.\",\"imageUrl\":\"https://cdn.britannica.com/21/235621-159-24129B3B/britannica-money-default-subject-logo-retirement.jpg\",\"categoryIcon\":{\"name\":\"MdSavings\",\"color\":\"green\"},\"slug\":\"Pensions-Annuities\",\"url\":\"/browse/Pensions-Annuities\"},{\"id\":13204,\"parentId\":13200,\"title\":\"Retirement Living\",\"description\":\"Throughout your career, you've been looking forward to retirement. But once you're there, you have a brand new set of decisions to make: travel, budgeting, tackling the bucket list, and maybe even taking on a new job or side hustle. Retirement living: It's a new beginning.\",\"imageUrl\":\"https://cdn.britannica.com/21/235621-159-24129B3B/britannica-money-default-subject-logo-retirement.jpg\",\"categoryIcon\":{\"name\":\"MdSavings\",\"color\":\"green\"},\"slug\":\"Retirement-Living\",\"url\":\"/browse/Retirement-Living\"},{\"id\":13205,\"parentId\":13200,\"title\":\"Retirement Planning\",\"description\":\"Are you expecting a long and comfortable retirement? Plan ahead. Will your savings and income streams support all your dreams for your golden years? And do you have contingency plans in case things change? Learn how to plan and strategize for retirement.\",\"imageUrl\":\"https://cdn.britannica.com/21/235621-159-24129B3B/britannica-money-default-subject-logo-retirement.jpg\",\"categoryIcon\":{\"name\":\"MdSavings\",\"color\":\"green\"},\"slug\":\"Retirement-Planning\",\"url\":\"/browse/Retirement-Planning\"},{\"id\":13206,\"parentId\":13200,\"title\":\"Social Security \u0026 Medicare\",\"description\":\"Most of us pay into Social Security and Medicare throughout our working lives; in retirement, we receive benefits. But to get the most out of these two government programs—and tailor them to your personal situation—you need to learn how they work.\",\"imageUrl\":\"https://cdn.britannica.com/21/235621-159-24129B3B/britannica-money-default-subject-logo-retirement.jpg\",\"categoryIcon\":{\"name\":\"MdSavings\",\"color\":\"green\"},\"slug\":\"Social-Security-Medicare\",\"url\":\"/browse/Social-Security-Medicare\"}]},{\"category\":{\"id\":13700,\"parentId\":13000,\"title\":\"Companies\",\"description\":\"The Global Industry Classification Standard (GICS) places companies into eleven sectors: Communication services, consumer discretionary, consumer staples, energy, financials, health care, industrials, information technology, materials, real estate, and utilities.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdBarChart\",\"color\":\"red\"},\"slug\":\"Companies\",\"url\":\"/browse/Companies\"},\"subcategories\":[{\"id\":13709,\"parentId\":13700,\"title\":\"Communication Services\",\"description\":\"Communication services, added in 2018, includes traditional and social media, web platforms, video game makers, and telecom providers. Companies include AT\u0026T, Netflix, Facebook parent Meta, and Google parent Alphabet.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdBarChart\",\"color\":\"red\"},\"slug\":\"Communication-Services\",\"url\":\"/browse/Communication-Services\"},{\"id\":13704,\"parentId\":13700,\"title\":\"Consumer Discretionary\",\"description\":\"Discretionary companies - autos, travel and entertainment companies, apparel makers, and e-commerce - tend to rise and fall with the consumer economy. Companies include Ford, Nike, Disney, McDonald’s, and Amazon.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdBarChart\",\"color\":\"red\"},\"slug\":\"Consumer-Discretionary\",\"url\":\"/browse/Consumer-Discretionary\"},{\"id\":13705,\"parentId\":13700,\"title\":\"Consumer Staples\",\"description\":\"Staples are everyday products such as toothpaste, detergent, food and beverages, groceries, and beauty supplies. Companies include Costco, Walmart, Coca-Cola, and Procter \u0026 Gamble.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdBarChart\",\"color\":\"red\"},\"slug\":\"Consumer-Staples\",\"url\":\"/browse/Consumer-Staples\"},{\"id\":13701,\"parentId\":13700,\"title\":\"Energy\",\"description\":\"The energy sector, which includes oil and gas producers, pipeline builders, and refineries, tends to follow commodities. Companies include ExxonMobil, Halliburton, Chevron, Occidental, and ConocoPhillips.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdBarChart\",\"color\":\"red\"},\"slug\":\"Energy\",\"url\":\"/browse/Energy\"},{\"id\":13707,\"parentId\":13700,\"title\":\"Financials\",\"description\":\"The financials sector includes insurance, commercial and investment banks, brokers, and credit card and payment providers. Companies include JPMorganChase, PayPal, Allstate, Visa, BlackRock, and Goldman Sachs.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdBarChart\",\"color\":\"red\"},\"slug\":\"Financials\",\"url\":\"/browse/Financials\"},{\"id\":13706,\"parentId\":13700,\"title\":\"Health Care\",\"description\":\"The health care sector includes pharmaceuticals, medical devices, biotechnology, and health insurance companies. Top names include Pfizer, UnitedHealth, Medtronic, and Johnson \u0026 Johnson.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdBarChart\",\"color\":\"red\"},\"slug\":\"Health-Care\",\"url\":\"/browse/Health-Care\"},{\"id\":13703,\"parentId\":13700,\"title\":\"Industrials\",\"description\":\"The industrials sector includes construction, agricultural machinery, airplanes, defense (weapons) contractors, railroads, and delivery companies. Top names include Lockheed Martin, Boeing, Caterpillar, FedEx, 3M, and CSX.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdBarChart\",\"color\":\"red\"},\"slug\":\"Industrials\",\"url\":\"/browse/Industrials\"},{\"id\":13708,\"parentId\":13700,\"title\":\"Information Technology\",\"description\":\"The growth-oriented tech sector makes and services semiconductors, cell phones, computer hardware and software, and services such as cloud computing. Companies include Apple, Microsoft, NVIDIA, and Cisco.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdBarChart\",\"color\":\"red\"},\"slug\":\"Information-Technology\",\"url\":\"/browse/Information-Technology\"},{\"id\":13702,\"parentId\":13700,\"title\":\"Materials\",\"description\":\"The materials sector includes agricultural services, miners, and makers of paper, steel, and chemicals. Typically growth-oriented dividend payers, companies include International Paper, Alcoa, Dow, Freeport-McMoRan, and Newmont.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdBarChart\",\"color\":\"red\"},\"slug\":\"Materials\",\"url\":\"/browse/Materials\"},{\"id\":13710,\"parentId\":13700,\"title\":\"Utilities\",\"description\":\"Known for stability and a history of solid dividends, the utilities sector includes electricity providers, nuclear power companies, and waste haulers. Companies include NextEra, Waste Management, and Duke Energy.\",\"imageUrl\":\"https://cdn.britannica.com/20/235620-159-F34405A1/britannica-money-default-subject-logo-investment.jpg\",\"categoryIcon\":{\"name\":\"MdBarChart\",\"color\":\"red\"},\"slug\":\"Utilities\",\"url\":\"/browse/Utilities\"}]},{\"category\":{\"id\":13600,\"parentId\":13000,\"title\":\"Biographies\",\"description\":\"Behind all the great ideas, philosophies, inventions, and industries are people who create, cultivate, and lead. Learn about the entrepreneurs, financiers, business executives, and economic thought leaders who shaped the world of money and finance.\",\"imageUrl\":\"https://cdn.britannica.com/22/235622-159-A518C19F/britannica-money-default-subject-logo-home-finance.jpg\",\"categoryIcon\":{\"name\":\"MdPerson2\",\"color\":\"blue-strong\"},\"slug\":\"Biographies\",\"url\":\"/browse/Biographies\"},\"subcategories\":[{\"id\":13601,\"parentId\":13600,\"title\":\"Bankers \u0026 Financiers\",\"description\":\"Learn about the bankers, financiers, and other facilitators of capital market growth throughout history - those who underwrote the industrial revolution, the building of railroads and automobiles, and today’s technology platforms.\",\"imageUrl\":\"https://cdn.britannica.com/22/235622-159-A518C19F/britannica-money-default-subject-logo-home-finance.jpg\",\"categoryIcon\":{\"name\":\"MdPerson2\",\"color\":\"blue-strong\"},\"slug\":\"Bankers-Financiers\",\"url\":\"/browse/Bankers-Financiers\"},{\"id\":13602,\"parentId\":13600,\"title\":\"Business Executives\",\"description\":\"Learn about the men \u0026 women who helped - and are helping - shape global corporations, private businesses, sports teams, \u0026 technology start-ups.\",\"imageUrl\":\"https://cdn.britannica.com/22/235622-159-A518C19F/britannica-money-default-subject-logo-home-finance.jpg\",\"categoryIcon\":{\"name\":\"MdPerson2\",\"color\":\"blue-strong\"},\"slug\":\"Businesspeople-Executives\",\"url\":\"/browse/Businesspeople-Executives\"},{\"id\":13603,\"parentId\":13600,\"title\":\"Economists\",\"description\":\"Learn about the academics, researchers, statisticians, and policymakers who shaped the economy—plus the thought leadership, models, formulas, and philosophies they crafted and implemented.\",\"imageUrl\":\"https://cdn.britannica.com/22/235622-159-A518C19F/britannica-money-default-subject-logo-home-finance.jpg\",\"categoryIcon\":{\"name\":\"MdPerson2\",\"color\":\"blue-strong\"},\"slug\":\"Economists\",\"url\":\"/browse/Economists\"},{\"id\":13604,\"parentId\":13600,\"title\":\"Entrepreneurs\",\"description\":\"Entrepreneurs bear the economic uncertainties and risks of starting and running new businesses to generate profit and economic value. Learn about these industrialists, number crunchers, and technology innovators.\",\"imageUrl\":\"https://cdn.britannica.com/22/235622-159-A518C19F/britannica-money-default-subject-logo-home-finance.jpg\",\"categoryIcon\":{\"name\":\"MdPerson2\",\"color\":\"blue-strong\"},\"slug\":\"Entrepreneurs\",\"url\":\"/browse/Entrepreneurs\"}]},{\"category\":{\"id\":13500,\"parentId\":13000,\"title\":\"Finance \u0026 the Economy\",\"description\":\"Explore the full spectrum of finance and economics, from historical frameworks to contemporary topics. 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It differs from the consumer score you see when you check your own score. This hard credit inquiry \u003ca href=\"/money/debt-collection-on-credit-report\"\u003eprovides information the lender can use\u003c/a\u003e to determine whether you qualify for a loan. It’s used to \u003ca href=\"/money/how-interest-rates-work\"\u003eset your interest rate\u003c/a\u003e and other terms.\u003c/p\u003e\u003c!--[P-4]--\u003e\u003cspan id=\"ref385987\" data-level=\"1\" /\u003e\u003ch2 class=\"h2\"\u003eWhat is a soft credit check?\u003c/h2\u003e\u003cp\u003eA soft credit check doesn’t usually affect your credit score. Many lenders do a soft credit pull to show you what you \u003cem\u003emight\u003c/em\u003e qualify for and the rate you could reasonably expect to get.\u003c/p\u003e\u003c!--[P-5]--\u003e\u003cp\u003eWhen you’re \u003ca href=\"/money/what-is-due-diligence\"\u003eshopping around for the best deal on a loan\u003c/a\u003e, keep these tips in mind:\u003c/p\u003e\u003c!--[P-6]--\u003e\u003cul data-listtype=\"UL\"\u003e\u003cli data-itemtype=\"LI\"\u003e\u003cstrong\u003eVerify that it’s a soft credit inquiry.\u003c/strong\u003e Double-check the fine print and confirm you’re getting a soft credit check that won’t affect your credit score.\u003c/li\u003e\u003cli data-itemtype=\"LI\"\u003e\u003cstrong\u003eCompare multiple lenders.\u003c/strong\u003e Check three to five lenders’ potential rates and terms to determine which offers the best deal.\u003c/li\u003e\u003cli data-itemtype=\"LI\"\u003e\u003cstrong\u003eKnow that the offer isn’t official until you apply and get a hard credit check.\u003c/strong\u003e A soft credit inquiry isn’t sufficient to approve your loan or finalize the terms. The lender makes a final decision based on the results of a hard credit inquiry. \u003c/li\u003e\u003c/ul\u003e\u003cp\u003eA soft credit check can help you learn where you stand with specific lenders creditwise and what you might reasonably expect. This information can be especially useful if you’re in the beginning stages of \u003ca href=\"/money/common-mortgage-terms\"\u003egetting a mortgage\u003c/a\u003e and want a ballpark figure of how much you can borrow and \u003ca href=\"/money/fixed-vs-variable-rate-mortgage\"\u003ewhat your rate and payment might be\u003c/a\u003e.\u003c/p\u003e\u003c!--[P-7]--\u003e\u003cp\u003eBut it’s not the final say, and you’ll need a hard credit check to get a \u003ca href=\"/money/qualifying-for-mortgage\"\u003emortgage preapproval\u003c/a\u003e or the \u003ca href=\"/money/financing-a-car\"\u003efinal terms on a car loan\u003c/a\u003e, \u003ca href=\"/money/payday-loans-title-loans\"\u003epersonal loan\u003c/a\u003e, or \u003ca href=\"/money/credit-card-companies\"\u003ecredit card\u003c/a\u003e.\u003c/p\u003e\u003c!--[P-8]--\u003e\u003cspan id=\"ref385988\" data-level=\"1\" /\u003e\u003ch2 class=\"h2\"\u003eHard vs. soft credit check: What’s the impact on your credit score?\u003c/h2\u003e\u003cp\u003eThe main difference between a hard and soft credit check is its effect on your credit score. A hard credit inquiry will affect your score, but depending on your situation, it’s unlikely to have a big impact. Many consumers find that a hard inquiry typically results in a drop of less than 5 points in their credit scores.\u003c/p\u003e\u003c!--[P-9]--\u003e"])</script><script>self.__next_f.push([1,"1a:Tc29,"])</script><script>self.__next_f.push([1,"\u003cp\u003eBut multiple hard credit checks within a short time can significantly affect your credit score. Lenders view this activity as a signal that you may be taking on substantial debt, which makes having you as a customer riskier. For example, \u003ca href=\"/money/best-rewards-credit-card-cash-back\"\u003eapplying for several credit cards\u003c/a\u003e within a few months can negatively affect your credit score more than a single inquiry for a \u003ca href=\"/money/pros-and-cons-of-debt-consolidation\"\u003epersonal loan\u003c/a\u003e.\u0026#xa0;\u003c/p\u003e\u003c!--[P-11]--\u003e\u003cp\u003eA soft credit check, on the other hand, doesn’t affect your credit score. Again, read the fine print before getting a rate quote to determine whether you’re authorizing a hard or soft credit check.\u003c/p\u003e\u003c!--[P-12]--\u003e\u003cspan id=\"ref385989\" data-level=\"1\" /\u003e\u003ch2 class=\"h2\"\u003eTips for a good credit score\u003c/h2\u003e\u003cp\u003eIf you maintain a good credit score, you shouldn’t have to worry about a couple of hard credit inquiries ruining your chances of a loan later. Your score will likely return to its previous level in a few months. With good credit, a ding caused by a credit inquiry won’t put you out of the running for other financial products and services.\u003c/p\u003e\u003c!--[P-13]--\u003e\u003cp\u003eFollow these tips to keep your score in tip-top shape:\u003c/p\u003e\u003c!--[P-14]--\u003e\u003cul data-listtype=\"UL\"\u003e\u003cli data-itemtype=\"LI\"\u003e\u003cstrong\u003ePay on time.\u003c/strong\u003e \u003ca href=\"/money/setting-monthly-budget\"\u003ePaying bills when they’re due\u003c/a\u003e is the best way to preserve your credit score. Because payment history is the most important factor, it benefits your score.\u003c/li\u003e\u003cli data-itemtype=\"LI\"\u003e\u003cstrong\u003eKeep your credit utilization low.\u003c/strong\u003e \u003ca href=\"/money/credit-cards-and-credit-scores\"\u003eIf you have credit cards, pay them off each month\u003c/a\u003e. If you do carry a balance, keep it to 30% or less of your available credit.\u003c/li\u003e\u003cli data-itemtype=\"LI\"\u003e\u003cstrong\u003eDispute errors when you find them.\u003c/strong\u003e Check your credit report a few times each year to ensure it’s accurate. If you find a problem, follow the credit reporting agency’s dispute process.\u003c/li\u003e\u003c/ul\u003e\u003cspan id=\"ref385990\" data-level=\"1\" /\u003e\u003ch2 class=\"h2\"\u003eThe bottom line\u003c/h2\u003e\u003cp\u003eWhen you’re applying for a loan or credit card, know the difference between a hard and soft credit check to avoid unintentionally decreasing your credit score.\u003c/p\u003e\u003c!--[P-15]--\u003e\u003cp\u003eA soft credit check is used for prequalification and allows lenders to review your eligibility without affecting your credit score. The information provided from a soft check can help you find the best loan terms. Submitting a formal loan application triggers a hard credit check; this provides the lender with a more detailed credit score to determine the loan terms it can offer you.\u003c/p\u003e\u003c!--[P-16]--\u003e\u003cp\u003eA hard check typically has little impact on your credit score, but several of them within a short period can lower your score significantly. To maintain a good credit score, \u003ca href=\"/money/automatic-bill-pay\"\u003epay your bills on time\u003c/a\u003e, keep your credit utilization low, and regularly check your credit report for errors. These practices help minimize the impact of hard inquiries on your credit.\u003c/p\u003e\u003c!--[P-17]--\u003e"])</script><script>self.__next_f.push([1,"7:[\"$\",\"$L18\",null,{\"initialArticle\":{\"contentInfo\":{\"contentId\":\"1-2252857-1\",\"browserTitle\":\"Hard vs. Soft Credit Check: Differences \u0026 Credit Score Impact\",\"metaDescription\":\"A hard credit check occurs during loan or credit card applications and can affect your credit score, while a soft check doesn’t.\",\"description\":\"Shopping for a loan? A lender may advise that you can get prequalified with a soft credit check. This inquiry provides general information about your credit history and won’t affect your credit score. But once you submit a formal credit application—even if it’s just for a branded credit card at\",\"lastUpdated\":{\"ms\":1732017600000,\"utcms\":1732017600000,\"formattedShortDate\":\"Nov. 19, 2024\",\"formattedLongDate\":\"November 19, 2024\",\"formattedDateTime\":\"Nov. 19, 2024, 7:00 AM ET\",\"formattedUTCDateTime\":\"Nov. 19, 2024, 12:00 PM UTC\"},\"url\":\"/money/hard-vs-soft-credit-check\",\"alternateTitles\":null,\"image\":{\"type\":\"IMAGE\",\"description\":\"PHOTO\",\"id\":314922,\"title\":\"Hard or Soft Credit Pull\",\"caption\":\"What happens when they pull your credit?\",\"credit\":\"© DragonImages/stock.adobe.com, © stefan1179/stock.adobe.com, © Stockistock/stock.adobe.com; Photo illustration Encyclopædia Britannica, Inc.\",\"url\":\"https://cdn.britannica.com/72/261772-004-ADD80A6B/Hard-and-Soft-Credit-Pulls-photo-illustration-image-Hands-pulling-tractoron-table-by-rope.jpg\",\"width\":550,\"height\":309,\"altText\":\"Photo illustration of hands pulling on a rope attached to a small tractor on a table.\"},\"title\":\"Credit 101: Hard vs. soft credit check\",\"titleText\":\"Credit 101: Hard vs. soft credit check\",\"identifier\":null,\"subTitle\":\"Know how credit inquiries affect your score.\",\"type\":\"OTHER\",\"slug\":\"hard-vs-soft-credit-check\",\"authors\":[{\"id\":12867794,\"title\":\"Miranda Marquit\",\"url\":\"/author/miranda-marquit/12867794\",\"description\":\"\u003cspan style=\\\"font-weight: 400;\\\"\u003eMiranda is an award-winning freelancer who has covered various financial markets and topics since 2006. 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Categories include banking, insurance, taxes, and managing debt, family, and your career.\",\"imageUrl\":\"https://cdn.britannica.com/22/235622-159-A518C19F/britannica-money-default-subject-logo-home-finance.jpg\",\"categoryIcon\":{\"name\":\"MdLocalOffer\",\"color\":\"blue\"},\"slug\":\"household-finance\",\"url\":\"/browse/household-finance\"},{\"id\":13304,\"parentId\":13300,\"title\":\"Debt Management\",\"description\":\"Debt management requires an understanding of credit scores, credit cards, loans, and interest. And if you should find yourself in over your head, it pays to know your options—and your rights—regarding collections and bankruptcy.\",\"imageUrl\":\"https://cdn.britannica.com/22/235622-159-A518C19F/britannica-money-default-subject-logo-home-finance.jpg\",\"categoryIcon\":{\"name\":\"MdLocalOffer\",\"color\":\"blue\"},\"slug\":\"Debt-Management\",\"url\":\"/browse/Debt-Management\"}],\"recentContent\":true},\"pageInfo\":{\"pageNumber\":1,\"title\":\"Credit 101: Hard vs. soft credit check\",\"url\":\"/money/hard-vs-soft-credit-check\",\"browserTitle\":\"Hard vs. Soft Credit Check: Differences \u0026 Credit Score Impact\",\"metaDescription\":\"A hard credit check occurs during loan or credit card applications and can affect your credit score, while a soft check doesn’t.\"},\"pageComponents\":[{\"type\":\"RECENT_NEWS_MODULE\",\"position\":0,\"content\":[{\"newsId\":\"3894104\",\"date\":{\"ms\":1731723479000,\"utcms\":1731723479000,\"formattedShortDate\":\"Nov. 15, 2024\",\"formattedLongDate\":\"November 15, 2024\",\"formattedDateTime\":\"Nov. 15, 2024, 9:17 PM ET\",\"formattedUTCDateTime\":\"Nov. 16, 2024, 2:17 AM UTC\"},\"headline\":\"Unpaid medical debt can ruin your credit. A proposed remedy is in sight.\",\"summary\":\"HTTP Status Code: 403\",\"newsUrl\":\"https://www.usatoday.com/story/news/health/2024/11/15/medical-debt-credit-score-rule/75775370007/\",\"source\":\"USA Today\"}]},{\"type\":\"HTML\",\"content\":\"\u003cspan id=\\\"ref2252857-1\\\" data-level=\\\"1\\\" /\u003e\u003cp\u003e\u003ca href=\\\"/money/what-is-due-diligence\\\"\u003eShopping for a loan\u003c/a\u003e? A lender may advise that you can get \u003ca href=\\\"/money/qualifying-for-mortgage\\\"\u003eprequalified\u003c/a\u003e with a soft credit check. This inquiry provides general information about your credit history and won’t affect your \u003ca href=\\\"/money/what-is-a-credit-score\\\"\u003ecredit score\u003c/a\u003e. But once you submit a formal credit application—even if it’s just for a branded credit card at your favorite retailer—you’ll be subject to a hard check, and that can \u003ca href=\\\"/money/how-to-raise-your-credit-score\\\"\u003ehurt your credit score\u003c/a\u003e.\u003c/p\u003e\u003c!--[P-1]--\u003e\"},{\"type\":\"HTML\",\"content\":\"\u003cp\u003eUnderstanding how a hard credit check differs from a soft one can help you decide when to \u003ca href=\\\"/money/good-debt-vs-bad-debt\\\"\u003eapply for debt\u003c/a\u003e and how to avoid negatively affecting your credit when searching for the best \u003ca href=\\\"/money/consumer-credit\\\"\u003eloan\u003c/a\u003e or \u003ca href=\\\"/money/understanding-credit-cards\\\"\u003ecredit card\u003c/a\u003e deal.\u003c/p\u003e\u003c!--[P-2]--\u003e\"},{\"type\":\"SIDEBAR\",\"title\":\"Key Points\",\"content\":\"\u003cul data-listtype=\\\"UL\\\"\u003e\u003cli data-itemtype=\\\"LI\\\"\u003eSoft credit checks don’t affect your credit score; lenders use them to advise what you might qualify for.\u003c/li\u003e\u003cli data-itemtype=\\\"LI\\\"\u003eA hard credit check is performed when you submit an official loan or credit card application and can have a negative effect on your credit score.\u003c/li\u003e\u003cli data-itemtype=\\\"LI\\\"\u003eWhen you’re shopping for the best deal, multiple inquiries in a short period usually count as a single credit check. \u003c/li\u003e\u003c/ul\u003e\",\"sidebarType\":\"CALLOUT\",\"pdfPath\":null},{\"type\":\"HTML\",\"content\":\"\u003cspan id=\\\"ref385986\\\" data-level=\\\"1\\\" /\u003e\u003ch2 class=\\\"h2\\\"\u003eWhat is a hard credit check?\u003c/h2\u003e\u003cp\u003eTypically, lenders perform a hard credit check, also called a hard credit inquiry or “pull,” after you’ve submitted an official application for debt.\u003c/p\u003e\u003c!--[P-3]--\u003e\"},{\"type\":\"ASSEMBLIES\",\"assemblies\":[{\"type\":\"VIDEO\",\"description\":\"VIDEO\",\"id\":294845,\"title\":\"Debt and Interest\",\"caption\":\"The difference between good debt and bad debt\",\"credit\":\"Encyclopædia Britannica, Inc.\",\"ccKey\":\"y6qwCZ8B\",\"videoId\":\"1dTnymyG\",\"adFileId\":\"gCRFYHor\",\"firstFrameUrl\":\"https://cdn.britannica.com/36/240036-138-123FD34B/deb-loans-credit-explaining-good-debt-versus-bad-debt.jpg\"}]},{\"type\":\"HTML\",\"content\":\"$19\"},{\"type\":\"SIDEBAR\",\"title\":\"How multiple hard checks affect your credit score\",\"content\":\"\u003cp\u003eCertain types of loans, such as \u003ca href=\\\"/money/fixed-vs-variable-rate-mortgage\\\"\u003emortgages\u003c/a\u003e, \u003ca href=\\\"/money/financing-a-car\\\"\u003ecar loans\u003c/a\u003e, and \u003ca href=\\\"/money/federal-vs-private-student-loans\\\"\u003estudent loans\u003c/a\u003e, require comparison. If you have multiple hard inquiries within 14, 30, or 45 days (depending on \u003ca href=\\\"/money/big-three-credit-reporting-agencies\\\"\u003ewhich scoring model\u003c/a\u003e the lender uses), all credit checks related to one type of loan are bundled and considered a single inquiry.\u003c/p\u003e\",\"sidebarType\":\"CALLOUT\",\"pdfPath\":null},{\"type\":\"HTML\",\"content\":\"$1a\"},{\"type\":\"HTML\",\"content\":\"\u003ch2 class=\\\"h2\\\"\u003eReferences\u003c/h2\u003e\u003cspan id=\\\"ref2252857-references\\\"/\u003e\"},{\"type\":\"HTML\",\"content\":\"\u003cul data-listtype=\\\"UL\\\"\u003e\u003cli data-itemtype=\\\"LI\\\"\u003e\u003ca class=\\\"external\\\" target=\\\"_blank\\\" rel=\\\"noopener\\\" href=\\\"https://www.consumerfinance.gov/ask-cfpb/whats-a-credit-inquiry-en-1317/\\\"\u003eWhat’s a Credit Inquiry?\u003c/a\u003e | consumerfinance.gov\u003c/li\u003e\u003c/ul\u003e\"}],\"tocItems\":[{\"title\":\"Introduction\",\"url\":\"/money/hard-vs-soft-credit-check\",\"tocId\":\"2252857-1\",\"level\":1,\"subSection\":[]},{\"title\":\"What is a hard credit check?\",\"url\":\"/money/hard-vs-soft-credit-check#ref385986\",\"tocId\":\"385986\",\"level\":1,\"subSection\":[]},{\"title\":\"What is a soft credit check?\",\"url\":\"/money/hard-vs-soft-credit-check#ref385987\",\"tocId\":\"385987\",\"level\":1,\"subSection\":[]},{\"title\":\"Hard vs. soft credit check: What’s the impact on your credit score?\",\"url\":\"/money/hard-vs-soft-credit-check#ref385988\",\"tocId\":\"385988\",\"level\":1,\"subSection\":[]},{\"title\":\"Tips for a good credit score\",\"url\":\"/money/hard-vs-soft-credit-check#ref385989\",\"tocId\":\"385989\",\"level\":1,\"subSection\":[]},{\"title\":\"The bottom line\",\"url\":\"/money/hard-vs-soft-credit-check#ref385990\",\"tocId\":\"385990\",\"level\":1,\"subSection\":[]},{\"title\":\"References\",\"url\":\"/money/hard-vs-soft-credit-check#ref2252857-references\",\"tocId\":\"2252857-references\",\"level\":1,\"subSection\":[]}],\"iguideLinks\":null,\"pageIds\":null,\"contentIds\":[\"1-2234776-1\",\"1-2234805-1\",\"1-2234787-1\",\"1-2234788-1\",\"1-2252856-1\",\"1-2234778-1\",\"1-2244978-1\",\"1-2234722-1\",\"1-2245014-1\",\"1-2244592-1\"],\"relatedContents\":[{\"title\":\"Good debt vs. bad debt: It’s all about targeting your goals\",\"url\":\"/money/good-debt-vs-bad-debt\",\"description\":\"Debt may sound like a bad word, but don’t let its reputation fool you. The risk is clear, but the other side of the coin may reveal a powerful tool to get you closer to your goals. Obviously, debt means owing money—especially money that needs to be paid back with interest. But some types of debt\",\"image\":{\"type\":\"IMAGE\",\"description\":\"PHOTO\",\"id\":null,\"title\":null,\"caption\":null,\"credit\":\"© fstop123—E+/Getty Images, © martin-dm—E+/Getty Images; Photo composite Encyclopædia Britannica, Inc.\",\"url\":\"https://cdn.britannica.com/55/235555-050-522F6A92/Good-Debt-Bad-Debt-composite-image-home-buyers-shoppers.jpg\",\"width\":null,\"height\":null,\"altText\":\"Good Debt Bad Debt, composite image: home buyers, shoppers\"},\"contentId\":\"1-2234792-1\",\"subTitle\":\"Some types of debt are better than others.\",\"category\":{\"id\":13304,\"parentId\":13300,\"title\":\"Debt Management\",\"description\":\"Debt management requires an understanding of credit scores, credit cards, loans, and interest. And if you should find yourself in over your head, it pays to know your options—and your rights—regarding collections and bankruptcy.\",\"imageUrl\":\"https://cdn.britannica.com/22/235622-159-A518C19F/britannica-money-default-subject-logo-home-finance.jpg\",\"categoryIcon\":{\"name\":\"MdLocalOffer\",\"color\":\"blue\"},\"slug\":\"Debt-Management\",\"url\":\"/browse/Debt-Management\"}},{\"title\":\"What is buy now, pay later and should you take advantage of it?\",\"url\":\"/money/what-is-buy-now-pay-later\",\"description\":\"Making a big purchase online can feel unmanageable, considering you either have to part with your money all at once, or you have to pay with money you don’t (yet) have. One trend that’s made it easier to buy what you want immediately is buy now, pay later (BNPL). What is buy now, pay later? It’s\",\"image\":{\"type\":\"IMAGE\",\"description\":\"PHOTO\",\"id\":null,\"title\":null,\"caption\":null,\"credit\":\"© panuwat/stock.adobe.com\",\"url\":\"https://cdn.britannica.com/63/238263-050-D335A107/BNPL-Buy-now-pay-later-online-shopping-concept.jpg\",\"width\":null,\"height\":null,\"altText\":\"Photo of a phone displaying the words \\\"Buy now, pay later.\\\"\"},\"contentId\":\"1-2234769-1\",\"subTitle\":\"There’s always a catch.\",\"category\":{\"id\":13304,\"parentId\":13300,\"title\":\"Debt Management\",\"description\":\"Debt management requires an understanding of credit scores, credit cards, loans, and interest. And if you should find yourself in over your head, it pays to know your options—and your rights—regarding collections and bankruptcy.\",\"imageUrl\":\"https://cdn.britannica.com/22/235622-159-A518C19F/britannica-money-default-subject-logo-home-finance.jpg\",\"categoryIcon\":{\"name\":\"MdLocalOffer\",\"color\":\"blue\"},\"slug\":\"Debt-Management\",\"url\":\"/browse/Debt-Management\"}},{\"title\":\"Facing a financial quagmire? Chapter 13 can help you create a repayment plan\",\"url\":\"/money/what-is-chapter-13-bankruptcy\",\"description\":\"Bankruptcy can be a jarring experience for individuals as well as sole proprietors. But if you find yourself in a financial quagmire that you need help escaping—and you wish to avoid a full-scale liquidation of your assets—filing for chapter 13 bankruptcy might make sense. Chapter 13 is like a\",\"image\":{\"type\":\"IMAGE\",\"description\":\"PHOTO\",\"id\":null,\"title\":null,\"caption\":null,\"credit\":\"© Jon/stock.adobe.com\",\"url\":\"https://cdn.britannica.com/78/249678-050-92D6F8EE/chapter-13-bankruptcy-printed-in-text-on-page-as-visual-aid-or-business-law-reference.jpg\",\"width\":null,\"height\":null,\"altText\":\"Chapter 13 bankruptcy printed in text on a page.\"},\"contentId\":\"1-2234709-1\",\"subTitle\":\"In need of a little breathing room?\",\"category\":{\"id\":13304,\"parentId\":13300,\"title\":\"Debt Management\",\"description\":\"Debt management requires an understanding of credit scores, credit cards, loans, and interest. 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