When you apply for a credit card or a loan, you must have heard the term “hard pull”. Some of us know that hard pull might make some negative impact on our credit score. But what exactly is this “Hard Pull”?
Hard pull is also called hard inquiry. Hard pull generally takes place when you apply for a mortgage, loan, or a new credit card. Under this situation, the financial institution, such as credit card issuer and a bank, might want to check your credit before making a lending decision, and thus you need to authorize them some permissions to this checking process.
Sounds quite normal, right? It seems like a hard inquiry is providing some financial information to the lender or the credit card issuer.
However, you should be aware that hard inquiry could lower your credit scores by a few points, regardless whether you want to authorize these financial institutions the rights to check your financial information.
Once you receive a hard inquiry, your credit scores would receive some negative impacts. If your financial situation is all right, you will only receive a negligible effect on your credit scores. However, if you financial well-being seems susceptible, you would receive lots of negative points on your credit scores.
In most cases, a single hard pull would not be a great deal for your application of a new credit card or a loan. Damages that the hard pull gives you would usually decrease or disappear if your future credit reports are excellent. Generally, a hard pull record exists for two years.
Another thing that needs to be mentioned is that if you apply a credit card online, you will definitely receive a hard pull per one online application even if your overall financial well-being is excellent. Thus, it would be better not to apply for a huge amounts of credit cards online, since this action might significantly reduce your credit scores.