Search
  • Faisal Khalid

Hard vs Soft Credit Checks

Updated: Jan 31

One of the most ill understood concepts for most consumers is that of a hard credit check.

What is it?

Why is it bad?

How is it different from a soft credit check?

Put simply, when lenders or someone else accesses your credit file, it leaves a footprint.


If the check that’s been run is a ‘soft check’, then that footprint is only visible to you and the person running it. Which means it can do no harm. If, however, the check that’s been run is a ‘hard check’, then it leaves a footprint that everyone else who accesses your credit file can see. This one is bad.


When you get a ‘quotation’ for a product on MoneySuperMarket, or another aggregator site, this typically leaves a ‘soft check’ footprint. When you actually apply for the product, for example on a bank website, this leaves a ‘hard check’ footprint.


Having a hard check footprint is not necessarily a bad thing. It means your credit score will go down temporarily. What’s bad is having multiple hard check footprints. This not only has a stronger detrimental impact on your credit score, but more importantly, it’s seen as a classic sign of desperation by other lenders.


How many hard checks is too many? 1-2 over a 3-6 month period is OK. Anything more than 2 is problematic. You may not see it, but lenders when they look at your credit file, will see how many hard checks you’ve had:

a) in the past 3 months b) in the past 6 months c) in the past 12 months The lesson here is that if you get rejected for a product that you applied for, don’t rush into applying for another one immediately. Take your time. The more times you’re rejected, the harder it’ll be to get anything.

11 views0 comments

Legal

Help & Support

Educational

  • Facebook
  • YouTube
  • Instagram

 

© Fea Card Limited 2021

Bits is powered by Fea Card Limited, a company registered in England with Companies House number 11620703, and registered with the Information Commissioner’s Office (ICO) with registration number ZA507202.