Credit Report Pulls: Your Complete Guide

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Credit report pulls are a common part of most of our financial lives. A company may want to run one when you’re about to get a new loan or you’re asking for an increase to your credit card limit. A landlord might conduct one before deciding to let you rent a property, and employers often perform them as part of the background check process during hiring.

But what exactly is a credit report pull, and what does it mean for your personal finances? If you’re asking questions like these, here’s everything you need to know about credit report pulls, from the different types of reports to the impacts they have on your credit score.

What Is a Credit Report Pull?

Also known as credit inquiries, credit checks and credit pulls, credit report pulls involve the act of reviewing your credit report and, in some cases, your credit score. Essentially, when a credit pull is performed, the requesting business or person obtains a copy of your credit report. The information that appears on the credit report varies based on the type of credit pull the company or individual performed. The amount of detail differs between inquiry types and in whether a credit score is provided or not.

In the simplest sense, lenders and other entities use credit checks to determine how responsible you are when it comes to your finances. Your credit report contains information about your debts and the payments you make on them. Businesses and individuals use the information on your credit report to determine whether to lend you money or extend you credit in some form. By reviewing your credit report and, potentially, your score, they can analyze your past behavior to determine if you’re a responsible borrower.

However, credit reports can also be part of a background check. This is more common if you’re applying for a job that involves some level of financial responsibility. For example, if you work in accounting, are engaged in cash handling or are in a position of public trust, a credit inquiry might be part of the hiring process.

The Different Types of Credit Report Pulls

Generally speaking, there are two types of credit report pulls. First, there are hard credit pulls. These are usually done by lenders that are assessing your level of financial risk. As a result, these pulls are almost universally part of the process when you apply for new credit. However, that’s not the only time they occur. For example, one classic credit card management technique involves securing a credit limit increase to ensure your credit utilization ratio stays low. If you specifically request one, a lender often conducts a hard credit pull as part of the decision-making process.

Hard credit pulls have the potential to impact your credit score. As a result, businesses need your permission to conduct this kind of credit check.

Second, there are soft credit pulls. These don’t affect your credit score, so companies can run them without your explicit permission. However, any company doing so needs a legitimate reason to access the information.

If you’re pre-screened for credit or lending offers, whether you initiate them or they’re initiated on your behalf, soft credit pulls are usually involved. Often, you’ll know one is about to occur if a lender says you can check your interest rate offering without impacting your credit score.

If you have open credit accounts, your lender may conduct soft inquiries as part of your account maintenance, such as when they’re determining if you’re eligible for a credit limit increase. At times, employers run soft credit pulls as part of a background check, too.

Who Can Pull Credit Reports?

Any company that needs to determine if you have a safe level of financial risk to do business with could potentially ask to pull your credit report. The most common example is lenders. When you apply for a loan or credit card, a hard pull is almost always part of the process.

However, lenders aren’t the only businesses that might want to check your report. Landlords often do hard credit pulls to ensure you’re financially responsible and likely to pay rent on time. Some utility companies perform them, as do some insurance companies.

There are some situations in which employers may also perform a credit pull, often as part of a background check. However, they don’t get the full version of your report or your credit score.

It’s important to note that before any company can perform a hard credit pull, it needs your permission. Usually, that means you complete and sign a form related to the pull, either by hand or digitally. Without that, businesses can’t perform anything but a soft credit pull, and they need a legitimate reason to do so.

You also have the right to pull your own credit report. Whether you use AnnualCreditReport.com, head to one of the major credit bureau sites, or go through MyFICO, checking your own credit report doesn’t impact your score. Similarly, credit monitoring services perform credit inquiries to gather the needed information on your behalf, but they don’t affect your score. However, that doesn’t mean other credit pulls won’t have an impact.

How Credit Report Pulls Impact Your Credit Score

Whether or not a credit report pull impacts your credit score depends on the report type. If it’s a soft inquiry, there’s no impact to your score. However, if it’s a hard pull, you might see a drop in your credit score. Just how much a hard pull affects your credit score and how long it has an effect depends on several factors.

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Generally, new credit account applications – which result in a hard pull – make up just 10% of your FICO score. A new hard pull initially causes a dip in your score. However, if you don’t have many other inquiries in the past two years, the dip usually only lasts for a few months. The same can be true if you have several hard pulls for the same type of loan within 14 to 45 days of each other, depending on the scoring model.

The reason for the latter is that it allows people to shop around for the best deal on mortgages, auto loans, student loans and similar products. However, it usually only applies to loans, not credit cards, so keep that in mind. In those cases, the decline may be just 5 points, or even less, especially if your credit history is otherwise strong. Also, it may only have an impact for a handful of months at most.

However, if you have numerous hard inquiries building up, apply for several credit cards in a relatively short timeframe or have a less-than-stellar credit history, the impact could be as high as 10 points per hard pull. That can add up quickly. In this case, the inquiries can impact your credit score for up to two years. Since that’s the case, it’s always best to avoid unnecessary hard pulls of your credit. 

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