What is the difference between a hard and soft credit check?

Full answer

Both are searches of your credit file held by agencies such as Experian, Equifax and TransUnion, but they differ in visibility and impact. A soft search (soft check) leaves a footprint only you can see when you log in to your credit report. Other lenders cannot see it, and it has no effect on your credit score. Soft searches are used for eligibility or 'pre-approval' checks, quotation requests, comparison-site searches, identity checks, and when you view your own report. You can run as many as you like without harm. A hard search (hard check) is recorded on your file and is visible to other lenders for around two years (though it usually only affects scoring for the first 12 months). It happens when you make a formal application for credit -- a mortgage, loan, credit card, car finance, mobile contract or sometimes a rental. Each hard search can knock a few points off your score, and several in a short period can look like you are desperate for credit, which lenders treat as higher risk. Practical guidance: use eligibility checkers (soft searches) before applying so you only submit a full application where you are likely to be accepted. Avoid making many credit applications close together. The exception is 'rate shopping' for the same product (for example multiple mortgage quotes) in a short window, which sensible lenders treat more leniently, though scoring models vary. A hard check does not directly affect tax or take-home pay, but a stronger credit profile usually means cheaper borrowing, which matters most for a mortgage. Before applying, work out what you can afford with a mortgage calculator, and check the total cost of any borrowing with a compound interest calculator so you understand the long-term repayment burden. Always confirm the lender will do a soft search for any quote before you proceed.

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