Do you know how much a credit score lies between? If not, let me tell you that it is a number between 300 and 900, which reflects the creditworthiness of the borrower. This score is determined by the credit bureaus.
Whenever we or your cibil score is calculated, a number of factors including your past payment history, credit utilization, number of hard inquiries on your credit profile, etc., are taken into consideration.
But some people are reluctant to check their CIBIL score because they feel that if they are checking, their score will often lower, but that doesnโt happen at all.
In this post, I will clear you all the questions related to credit score. The low Score of an individual depends on many factors such as non-payment of loan on time, applying for multiple credit cards at the same time, number of difficult inquiries or enquiries etc.
By the way, any person can inquire it in two ways: first soft enquiry and second hard enquiry.
Whenever you check, an inquiry is noted on your credit report.ย Depending on the medium through which you have inquired. Who is checking and why it is being checked, the inquiry can be classified as either a soft inquiry or a hard inquiry.
Now let me tell you that if you do a soft inquiry then this soft inquiry does not affect, but on the contrary, if you do a hard inquiry, then hard inquiry can affect it.
If you do a check yourself, then this check is considered a simple inquiry and will not affect your credit either.
Hereโs what you need to know about soft and hard inquiries and why let me tell you that if you check it regularly, it doesnโt lower your CIBIL Score, on the contrary, you need to check. The information is updated which is a good idea.
What is a soft inquiry?
As the name suggests, a soft inquiry can be done online only and not impact. And yes, a soft inquiry is sometimes called a soft credit check.
You pass on the responsibility of checking it to your employer, your landlord and one checks with your permission.
If you take a loan from a bank or any other institution, a lender checks your credit profile to pre-qualify or pre-approve you.
Does soft inquiry lower your credit score?
- Soft Inquiry does not affect your credit score in any way, it is not your application for any kind of credit.
- So whenever you fill out a form at a bank or any other institution for a mortgage, student loan, personal loan or credit card, there is no strings attached.
What is a hard inquiry?
Whenever you go to take a loan from any bank or any other institution, the lender requires your credit report.
And that lender requests your credit report from the credit card bureaus to get the required credit information.
And as soon as he asks for your credit report, it makes for a tough inquiry and it can temporarily lower it.
And this hard inquiry stays on your credit report for almost 2 years and further if you want to take loan from any company then this credit report is visible to any lender for about 2 years.
Does hard inquiry lower your credit score?
- Yes, if hard inquiries are made by a lender, it can have a direct impact on your CIBIL score card which can temporarily lower your it.
- Because whenever you apply for a loan from a bank or any other institution, the lender makes a hard inquiry from the credit card bureaus, which will show up in your credit report.
- ย This Hard inquiry from credit card bureaus can lower it temporarily.
