Does A Credit Inquiry Lowers Your Credit Score?

July 14, 2020 Shauna

Many people including renters believe credit inquiries have a detrimental effect on your credit score. Some even believe that even checking their own credit score impacts and lowers their credit score. I’m not an exception and had the very same idea in my mind until I dived deep. Here is what I found out!  

Does a credit inquiry lowers your score?

The short answer is a soft credit inquiry does not impacts your credit score but a hard credit inquiry will impact and lower your credit score. For example soft credit inquiries such as things like mortgage pre-authorization and tenant rental screenings will not lower your credit score. However a hard credit inquiry such as when a lender requests your credit report for a loan application, it will impact your credit score. 

What is a soft credit inquiry?

A “soft” credit inquiry is like when you check your own credit reports or when a promotional credit card offer is generated for you. Soft inquiries do not impact your credit scores.  

What is a hard credit inquiry?

As per Equifax, one of the two major credit bureaus in North America, “When a lender or company makes a request to review your credit reports as part of the loan application process, that request is recorded on your credit reports as a hard inquiry, and it usually will impact your credit scores. 

Rental resources:

How many points a hard credit inquiry can lower credit score?

As per Experian the second major credit bureau in North America, “A hard credit inquiry from a lender can lower your credit score between 5-10 points. If you have a strong credit history and no other credit issues, you may find that your scores drop lower end of that.”

A hard credit inquiry tell your lenders that you have been shopping for credit and can provides them meaningful insight in to your personal finances and credit worthiness. 

Multiple hard credit inquiries in a short period of time can seriously impair your credit score and credit worthiness. It has the potential of pushing your credit score to altogether in a different category if you don’t have a plan.  

Therefore it is important that you review your credit report before shopping for credit so you know what all information is included in a credit report. Find out how you can request your free credit report


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About the Author: Shauna is Alberta based writer who is passionate about real estate and frequently writes in online industry magazines columns. The views expressed are her own. About the Editor: Shawn Verma is Technology & Real Estate Expert and published author. He is an experienced technology and real estate professional with over 25 years in the technology and real estate expertise. He writes about latest trends in Technology and Real Estate in blogs in online industry magazines and groups and social media