While the presence of hard inquiries on your credit report can significantly impact your overall creditworthiness, applying for credit or loan-related services will inevitably lead to a hard inquiry being recorded. But how long do hard inquiries stay on your credit report?

To help you preserve an excellent credit score and maintain your financial health, we bring you everything you need to know about hard inquiries and their longevity on your credit report, as well as how to lower their impact.

The Difference Between a Soft and Hard Inquiry

The Consumer Financial Protection Bureau’s Fair Credit Reporting Act allows for credit report inquiries to investigate and evaluate a consumer’s creditworthiness in an impartial way that protects privacy rights. In this sense, we can differentiate between:

1. Hard inquiry
2. Soft inquiry

Hard Inquiry

A hard credit report inquiry occurs when a prospective lender reviews a consumer’s credit report specifically for completing decisions related to issuing credit. The activities that most commonly trigger a hard credit inquiry include:

• Applying for new credit card debt
• Trying to obtain a mortgage
• Signing up for personal or student loans

A hard credit inquiry generally results in a slight, temporary drop in your credit score regardless of whether the loan or financing was approved or not. Recent hard inquiries suggest to a prospective lender that a consumer might have unexpectedly encountered financial problems.

Soft Inquiry

A soft credit check or inquiry is performed by either a consumer or a company for reasons not directly related to lending decisions. Soft credit checks only appear on consumer disclosures, which are personally requested credit inquiries.

These checks have no impact on your credit score, and the most common examples of soft inquiries include:

• Checking your personal credit report
• Checking performed as part of pre-employment background screening for potential new hires
• Inquiries performed by credit card companies for the purposes of marketing their pre-approval offers
• Checks performed by those a consumer has an existing relationship with, such as credit card companies making decisions regarding adjustments to credit limits, interest rates, etc.
• Inquiries made by car insurance companies and other property insurers on applicants when calculating their rates and premiums

Some consumers worry that checking their credit has the same adverse effect on their credit score as a hard inquiry—in fact, credit card statistics reveal that 54% of adults never check their credit score, and this is likely one of the reasons why. However, this is false, and checking your report annually to detect any errors in the account information and payment history is encouraged.

What’s the Lifespan of a Hard Inquiry on a Credit Report?

The three major credit bureaus—Equifax, Experian, and TransUnion—must record hard credit inquiries or “hard pulls” on consumer credit files for two years. This is done to help lenders assess your current creditworthiness more easily.

Although the credit reporting agency is obligated to document hard credit account inquiries for 24 months on your credit bureau report, both the Fair Isaac Corporation (FICO) and VantageScore credit score models only factor in hard inquiries from the previous 12 months.

Per FICO, lenders and creditors view hard inquiries as a sign of risk—statistically, consumers with six or more inquiries on their credit bureau reports are several times more likely to file for bankruptcy. However, they’re viewed as less harmful than missed payments, late payments, and some other factors featured on your credit report.

How Much Can a Hard Inquiry Impact Your Credit Score?

While the presence of hard inquiries on your credit report is only temporary, it does affect your credit score. However, the impact of hard inquiries in this sense is minor compared to other factors surrounding your credit history, and typically easier to recover from. Here’s an approximate breakdown of how much hard inquiries can impact your credit score, according to FICO and VantageScore respectively:

Credit score model	Credit score decline
FICO	Less than five points
VantageScore	5–15 points

Keep in mind that FICO and VantageScore’s models of calculation continue to evolve, and they maintain specialized sub-versions used by different types of lenders, meaning that the scores often vary slightly.

FICO characterizes hard inquiries as having a “small” impact on FICO scores, while acknowledging that consumers with a shorter credit history and fewer accounts are most susceptible to a drop. Meanwhile, VantageScore describes hard inquiries as one of the “least” influential factors affecting your credit score, stating that changes in your credit score are more dependent on your overall credit profile.

Can You Dispute Unauthorized Hard Inquiries? 

Checking your credit report is a good practice that often reveals errors or mistakes, some of which may be hindering your credit score. If you’re worried doing so may negatively reflect on your credit, keep in mind that consumers are eligible to receive a free copy of their credit report from the major credit bureaus each year. 

One of the anomalies you may notice when looking into your credit report can be a hard inquiry that you don’t recognize. Before conducting a hard credit inquiry, all parties must have permission according to the conditions outlined in the Fair Credit Reporting Act. If a party accessed your credit report without authorization, the act might be considered fraudulent and allow for the removal of the inquiry.

How To Dispute an Unauthorized Hard Inquiry

In some cases, consumers will have uncertainty regarding the source of the inquiry, which doesn’t necessarily mean that it was fraudulent. For example, some of the retail store brand credit card programs are operated by a third-party bank or financial institution, making the inquiry appear unfamiliar to you.

However, if you believe the hard inquiry on your report is fraudulent, there are measures you can take to rectify the situation. TransUnion even created a checklist of best practices for consumers who suspect that an unauthorized credit inquiry has occurred. Here are the steps:

1. Use the contact information noted on the report to check whether the inquiry is related to an existing account or application that you initiated
2. If no evidence of an existing account or formal application exists, ask the institution to notify the three reporting agencies in writing to request the removal
3. If it appears that the inquiry involves attempted identity theft or other fraud, promptly notify the Federal Trade Commission (FTC)
4. Consider making a fraud alert, which requires no fee and has no adverse impact on your credit score
5. You can also implement a “credit freeze” program or monitoring program moving forward to avoid similar cases in the future

As consumers establish and build credit, hard credit inquiries are an inevitable reality, as lenders must be diligent. However, taking the time to review your credit report and dispute any unauthorized inquiries can save you a lot of trouble with your credit score down the line.

How To Lower the Impact of Hard Inquiries

Although any hard inquiries on your credit report will inevitably reflect on your credit score, you can minimize their impact by taking the following steps:

1. Avoid unnecessary credit applications
2. Mind the hard inquiry timeframe
3. Take advantage of pre-approval offers
4. Consider a credit builder loan

Avoid Unnecessary Credit Applications

Since a hard inquiry will cause a slight decline in your credit score, it’s a good rule of thumb to avoid applying for credit accounts that you don’t need. It’s also important to recognize that this adverse effect could be compounded when multiple hard inquiries appear on your credit report in a short period of time, which is all the more reason to avoid unnecessary inquiries.

Mind the Hard Inquiry Timeframe

FICO and VantageScore understand that the lending market is a competitive environment, and consumers now are usually encouraged to “shop around” among potential lenders in search of more favorable interest rates or lower fees. For this reason, credit scoring models will usually merge or consolidate multiple related credit inquiries into a single inquiry, with the exception of multiple credit lines.

According to VantageScore, all related inquiries occurring within 14 days are combined into one, and only one entry appears on your credit report. Meanwhile, FICO’s previous models also used a 14-day timeframe, while its newer models have been extended to a 45-day period. You should keep this in mind while shopping and strive to conduct all your comparisons within 14 days, including those for:

• Car loans
• Mortgages
• Student loans

Take Advantage of Pre-Approval Offers

One option for minimizing the impact of hard inquiries is to consider lenders that offer pre-approval offers, which involve the lender already extending an offer before you apply for a loan. For example, Capital One has developed a pre-approval tool for many credit cards that generates only a soft credit inquiry.

However, while pre-approvals rely on soft inquiries, a possible drawback of this approach is that the lender may still perform a formal hard inquiry before finalizing the application process.

Consider a Credit Builder Loan

The best way to minimize the impact of a hard inquiry is taking action to proactively improve your credit score before pursuing financing options. With a credit builder loan like the one CreditStrong offers, you can boost your credit score more easily and minimize the impact of any hard inquiries, late payments, or other factors.

A credit builder loan is a form of installment loan that places the borrower’s loan funds in a secured savings account for the term of the loan. After all of the loan payments have been paid, the funds of the secured account are made available. Whether the goal of your CreditStrong account is to build your credit score fast, establish a payment history, or build big credit, you can expect to achieve it with the help of our customizable credit builder loans.

To secure an excellent credit score, take a look at our account options and try one out today!

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