Navigating the intricacies of credit inquiries is crucial for individuals seeking to maintain a healthy credit profile while pursuing financial opportunities such as mortgage preapproval. In this blog post, industry experts Mike Bernhart of Armor Mortgage and Mike Love of Great Move Realty collaborate to elucidate the differences between soft and hard credit pulls, providing invaluable insights for individuals looking to make informed decisions about their credit.

Understanding Soft and Hard Credit Pulls

Credit inquiries, also known as credit pulls or credit checks, occur when a lender or creditor accesses your credit report to evaluate your creditworthiness. These inquiries can be categorized into two main types: soft pulls and hard pulls.

• Soft Credit Pulls:

• Soft credit pulls are inquiries that do not impact your credit score and are typically used for informational purposes.

• These inquiries may occur when you check your own credit report, when a lender preapproves you for a loan or credit card offer, or when a potential employer conducts a background check.

• Soft pulls provide lenders with a snapshot of your credit history without affecting your credit score or appearing on your credit report for other lenders to see.

• Hard Credit Pulls:

• Hard credit pulls are inquiries that can impact your credit score and are typically associated with credit applications for loans, mortgages, or credit cards.

• These inquiries involve a thorough review of your credit report and are used by lenders to assess your creditworthiness when making lending decisions.

• Hard pulls may slightly lower your credit score and remain on your credit report for up to two years, where they can be seen by other lenders.

The Importance of Soft Credit Pulls in Mortgage Preapproval

Mike Bernhart highlights the significance of soft credit pulls in the mortgage preapproval process, emphasizing their ability to provide lenders and clients with valuable insights without negatively impacting their credit scores. By conducting a soft credit pull before preapproval, lenders can assess a client's creditworthiness and identify any potential areas for improvement or adjustment, ultimately streamlining the mortgage application process and ensuring a smoother experience for all parties involved.

Expert Guidance for Financial Success

As trusted professionals in the real estate and mortgage industries, Mike Bernhart and Mike Love underscore the importance of understanding the nuances of credit inquiries and their impact on financial decisions. By leveraging their expertise and guidance, individuals can navigate the credit landscape with confidence, making informed choices that support their long-term financial goals.

In conclusion, distinguishing between soft and hard credit pulls is essential for individuals seeking to manage their credit effectively and make informed financial decisions. By understanding the differences between these types of inquiries and their respective implications, individuals can take proactive steps to protect their credit health and achieve their financial objectives with confidence.