What Is Soft Credit Report Inquiry?

Since the beginning of the development of how finances are managed, people have devised different methods and processes on how things like financial capacity of a person is checked and evaluated. A concrete example of that is a credit inquiry. There are two ways on how it is done. A soft credit report inquiry and a hard credit report inquiry.

A soft credit report inquiry is the process wherein a company or an entity checks an individual’s credit report writing as a part of background check when that individual applies for a loan. It becomes a way for the lender to decide whether applicant gets approved or denied.

How to Remove Credit Inquiries from Your Credit Report

Some people are eager to remove credit inquiries from their credit report because too many inquiries could affect your credit score. Lenders see this as a sign of risk analysis and it definitely creates a bad impact when you are trying to apply for a loan. However, we need to remember that only hard inquiries affect a credit score and not soft inquiries.

Soft credit inquiries stay on your credit report for a maximum of two years after which, it does away by itself. However, for some people who want to remove them because they want to avoid bad reputation, you need to follow these three simple steps.

  • Ask for your credit reports. This is the first thing that you need to do. Order your credit reports to read and find out which inquiries you want to remove. You also need to identify which of those inquiries are hard pull and soft pulls. You do not have to worry about those soft pulls because they do not affect your credit score at all.
  • Find the addresses. Experian credit reports list down the addresses of the creditors who had an inquiry while some others do not. Collect all the addresses of the creditors to you want to be removed from your report.
  • Write a letter. Once you have gathered the addresses, write a letter requesting the creditor to remove their inquiry on your credit report.

Hard vs. Soft Inquiries on Your Credit Report

Credit inquiries play an important role in an individual’s chance of getting a loan. That is why most people or probably every gets irritated and alarmed when they see credit inquiries on their credit reports. But what is a credit report? A good definition is coming from investopedia.com, a source of financial and accounting references. It defines to check a credit report as “a detailed technical report of an individual’s credit history.” Credit bureaus collect information and create credit reports based on that information, and lenders use the reports along with other details to determine loan applicants’ credit worthiness.

A credit report will include credit inquiries and there are two different types of it. The soft inquiry or sometimes called ‘soft pull’ and hard inquiry which is also called ‘hard pull’.

A soft inquiry happens when a creditor or a company checks a person’s credit history formal report as part of a background check. It is merely a matter of a simple assessment and does not require permission from the person. It also does not affect his/her credit score. On the other hand, a hard inquiry occurs when an individual grants permission to do an inquiry and usually occurs when applying for loans or credit cards. It does affect one’s credit score because it can indicate that such individual is in financial trouble.

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