Do credit inquiries affect your fico score?
It depends on which type of inquiry is done. There are two types of credit inquiries:
- “Hard” pulls (inquiries)
- “Soft” pulls (inquiries)
Hard inquiries do affect your credit score. Often around 10 points or so from my own experience. A hard inquiry is most often done when applying for new credit. A new credit card, a mortgage, a new car loan will normally all result in a “hard” inquiry. Hard inquiries will stay on your credit report for 2 years before falling off.
Soft inquiries however do not have an affect on your credit score. They will show up on your credit report, but will not affect your score. On your report they may be shown as “Account Review Inquiries”. When you check your own score, using MyFico for example, you are doing a “soft” pull on your own credit. It does not harm your score, but it is reported.
In my own experience, I’ve seen soft pulls from banks (when opening a new account), insurance companies (GEICO), and credit card companies themselves (if you request a credit increase, always ask that they do a “soft” pull). Online banks such as ING and LendingClub showed up as soft inquiries for me as well.
Whenever dealing with new credit, or anytime a company pulls your credit, make sure they clarify if it is a “soft” or “hard” pull on your report. Soft is better and will not effect your credit score.
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