A “pull” on your credit report is the term that is used to refer
to an existing or potential creditor accessing your credit file to
look into your credit history. There are two different types
of pulls that can be performed and they affect
your credit score in different ways.
A “Soft” pull or inquiry is a pull that occurs most often
without your knowledge. The good news is that you need not
worry because these types of pulls do not affect your credit
score. Soft pulls can be done for promotional purposes, like
receiving a credit card offer in the mail. Other types of
soft pulls include employment background checks and checking your
own credit score. An employer is allowed to access your
credit file for employment purposes, as long as you have
knowledge and provide your existing or potential employer with
written consent to do so. Access into your credit file by an
employer will not affect your score. Likewise, you may check
your own
credit report as often as you like without it affecting your
score.
A “Hard” pull or inquiry does adversely
affect your credit score. You should always be aware of
hard pulls because you must authorize this access into your credit
history. For example, when you apply for credit or a
refinance or a loan, you give a company permission to access your
credit file prior to approving you. This access helps the
creditor determine whether or not to approve you and at what
interest rate your may be approved for. This type of inquiry
becomes part of your credit report and is included in the inquiry
section of your credit
file. Hard inquiries may be viewed by other existing or
potential lenders. It is important to understand that when
you are shopping around for the best deal or interest rate, several
pulls conducted for the same purpose within a 45 day period will be
treated as a single pull for purposes of your credit score.
It is still important not to apply for too many loans or credit
cards because it can drag your score down or be a cause for concern
with lenders if you are inquiring too often. A large number
of inquiries may raise a red flag to existing or potential lenders
that you are a potential risk.
For more information regarding your credit report or to speak
with an attorney, please contact SmithMarco, P.C. for a free case
review.