How Long Do Hard Inquiries Stay on Credit Report
As you find out on how to manage your credit, it is important that you have to know the factors that are observed in your credit score. One such factor is hard inquiry to credit file This is more pronounced when there are more than one credit reference with hard inquiry on your credit report.
Such requests could therefore affect your score significantly if they are frequently requested in a given period. By reading this article, I want you to be informed on what actual hard inquiries are, their impact on your overall credit score and tenure, as well as the methods of dealing with them.
What Are Hard Inquiries?
These are also referred to as hard pulls because they involve manually accessing your credit report during credit granting. This often occurs when you take a loan, mortgage, credit card or any other credit facility from a finance company.
While you have a lot of control over soft inquiries such as when you pulled your credit report or when some employer or organization ran your background check, hard inquiries do affect your score. Freeman mentions that they tell potential creditors you are in search of more credit and may shape credit evaluation.
How Do Hard Inquiries Affect Your Credit Score?
As has been shown, extra attention should be paid to hard inquiries since they can influence credit scores to some extent. Normally, making a hard inquiry does not have a huge impact on credit score but generally, most credit scores are usually dropped by some point or two.
However, multiple hard inquiries in a short time frame can negatively impact the credit more than when a single inquiry is made within a certain time frame since it gives a signal that you are a risky customer. Here’s a table illustrating the potential impact of hard inquiries:
| Number of Hard Inquiries | Potential Impact on Credit Score |
| 1 | 0-5 points |
| 2-4 | 5-10 points |
| 5 or more | 10+ points |
Reference: According to FICO, each hard inquiry can decrease your credit score by a few points, but the effect diminishes over time as long as there are no new inquiries or other negative changes.
How Long Do Hard Inquiries Stay on Your Credit Report?
Hard inquiries are also reported on the credit report and are visible for the next two years starting from the time the credit was checked. However, their effect on your credit score generally declines in the course of the first year of the credit card. Ideally, one needs to be cautious when applying for credit during this period because many applications for credit result in the lowering of one’s credit score.
Difference Between Hard and Soft Inquiries
People, therefore, have to make a distinction between soft and hard inquiries because each affects their credit report.
Hard Inquiries
- Purpose: They happen when a lender or a creditor pulls a credit report in order to make a credit decision.
- Impact on Credit Score: Has the capability of lowering your score by a few points.
- Visibility: This is a notation that is in the public domain meaning anyone with an access to your credit report; can be able to see it.
- Examples: Filling in application forms for a loan for the purchase of a home, for a credit card, car or a personal loan.
Soft Inquiries
- Purpose: This takes place when you run your own credit report, or when a lender runs it before you formally apply for a loan.
- Impact on Credit Score: They also do not have any adverse effects on your credit score.
- Visibility: Not observable for outsiders, but is recorded on one’s credit profile.
- Examples: Employer verifications, personal credit score check, credit cards that one is pre-approved for.
Table Comparing Hard and Soft Inquiries
| Feature | Hard Inquiries | Soft Inquiries |
| Purpose | Lending decision | Personal checks, background checks |
| Impact on Credit Score | Can lower score by a few points | No impact |
| Visibility | Visible to all who check credit report | Visible only to you |
| Examples | Mortgage applications, credit card applications | Employer background checks, self-checks |
How to Minimize the Impact of Hard Inquiries
While hard inquiries can affect your credit score, there are several strategies you can employ to minimize their impact:
1. Limit Credit Applications
It is only advice to apply for new credit only when it is absolutely necessary. Any application can potentially put a hard inquiry on your credit report, so be wise in your credit applications.
2. Rate Shopping
If you are in the market for a loan, like a mortgage or auto loan, attempt to get all your credit scores in a relatively short span. The credit scoring models tend to provide for the bundling of inquiry within the period of 14-45 days, and therefore, they consider it only as one inquiry.
3. Check Your Credit Report Regularly
Be attentive to your credit report so you can disapprove of all hard inquiries. Any such inquiry on your report that you did not recognize, you should challenge the credit bureaus to have it deleted.
4. Maintain Good Credit Habits
Cardholders who utilize good credit practices involving timely payment of bills, low credit utilization and good management of credit will have fewer and less serious effects of the hard inquiries in the long run.
5. Consider Pre-Qualification
To be more particular with the lenders, one should consider those with pre-qualification that would involve a soft pull. This enables you to determine your qualification without denting your credit status.
Conclusion
It can be seen that awareness of the types of inquiries and their effect on the credit report is also part of good credit practices. Since you now understand what hard inquiries are, how they are reflected in your credit scores and for how long they will remain in your credit report, you will be better placed in making better choices when it comes to credit application.
Also, the understanding of the differences between hard and soft inquiries, the ways to reduce the influence of hard inquiries, and measures to deal with unauthorized inquiry will prevent you from damaging your credit score further and, on the contrary, will assist you in building a stable credit history.
Main activities involving credit monitoring and good credential practices are important in maintaining health credit status. Be on the lookout and should actively work to make sure that the credit report depicts the correct standing of your credit.
