3 Things Houston first time home buyers should know about Hard or soft Credit Inquiry
Purchasing a home involves a lot of moving parts that must all come together so you can close on your dream home and get the keys. One of these parts is applying for your mortgage loan. The result of this pull will be a hard inquiry on your credit.
While a soft inquiry is more of a routine check that can be done without your permission, A hard pull does require your permission and does impact your credit score. Here are three examples of soft inquires:
Unsolicited offers like pre-approval credit card offers, or mortgage refinancing offers.
Lenders you're currently doing business with, may check your credit from time to time to make sure you're still creditworthy.
Potential new employers is also another source of soft inquires.
On the other hand, a hard inquiry is a formal request for credit by way of a completed application. When a hard inquiry is performed, it will impact your credit score and can remain on your credit report for up to two years. Here are three examples of hard inquires:
Applying for a credit card
Turning on utilities
Applying for a personal loan or mortgage
So, as you can see, the main difference between a hard inquiry and a soft credit inquiry is the reason for the pull. If you are applying for credit, it will be a hard pull. If you are not, it will be a soft pull. For each hard pull, you are likely to lose a few points. As always, thank you for stopping by. Until next time...Diana
Image by Diana
