Hard Credit Inquiry and Impact on Credit Score

Key takeaways:

Your credit report reflects your financial standing. This can affect your chances of approval for a new loan or credit card, along with the terms for either.
A hard inquiry goes in-depth into your credit report to determine your level of financial responsibility.
A hard credit inquiry may decrease your score by a few points. However, there are ways to minimize the impact and ensure hard credit inquiries won’t damage your credit score long-term.

Credit inquiries help a bank or lender assess your level of financial responsibility. They conduct a credit check to determine whether or not you’re able to take on a big commitment, such as a personal loan or lease.

There are two types of credit inquiries: hard inquiries and soft inquiries. Of the two, a hard inquiry can impact your financial status. It’s important to understand what a hard credit check is, when it’s typically utilized, and how it might affect your credit score and financial standing.

Credit inquiries & why they matter

Lenders, landlords, and potential employers all have the ability to request access to your credit file. Credit inquiries give them an overview of your credit utilization and overall borrowing habits. This information can help them determine the likelihood you’ll miss payments or default on a loan.

What is a hard credit inquiry on a credit report?

A hard credit inquiry is a request to check your credit report and obtain approval on a new line of credit, such as a credit card or personal loan. Hard inquiries allow lenders to look at your credit file in depth. This information is necessary to determine if you’re a high-risk customer.

The details found through a hard inquiry play a significant role in a lender’s decision to approve or deny your request for a credit line. It also impacts the term options available to you.

For example, if a lender determines you’re a risky borrower, you may get higher interest rates with your loan offer.

Pro tip: If you’re thinking about applying for a loan, consider checking your rate through Upstart. Our model considers more than your credit score. It looks at additional factors, such as your education¹ and work experience, to determine your loan options.

Hard inquiry Examples

Some of the most common reasons for a hard inquiry include:

Loan applications (including personal loans, mortgages, and car loans)
Credit card applications
Apartment rental applications

Pro Tip: If you’re unsure how a particular inquiry might classify, ask the financial institution whether it’ll be a soft or hard inquiry beforehand. Certain types of credit checks could show up as either. Common examples include setting up utilities or a bank account, cell phone contracts, or renting a car.

How a hard inquiry on credit affects your credit score

A hard inquiry has the ability to affect your credit score and credit standing. That’s why potential creditors need permission from consumers before conducting a hard credit inquiry. Once you request the lender “pull” your credit report, they’ll check with one, two, or all three credit reporting agencies: TransUnion®, Experian®, and Equifax®.

In most cases, a hard inquiry will lower your credit score by a few points. However, multiple credit inquiries spread out over several months may create a more noticeable drop in your score.

Hard inquiries also go into your credit report. They serve as a timeline, noting when you’ve applied for new credit.

Wherever you are in terms of your credit health, it’s beneficial to know how a hard inquiry can impact your financial standing.

How many points does a hard inquiry affect on your credit score?

Not every hard inquiry will drastically affect your credit score. Typically, one hard credit pull will lower your score by no more than five points.

Pro tip: When a lender pulls from your credit report, they have the option to pull from one or more credit bureaus. Your score will only be docked by the credit reporting agency the inquiry was pulled from. This is why one set of numbers can look worse than the other(s).

How long do hard inquiries stay on your credit report?

A hard inquiry will remain on your credit report for two years. However, it should only affect your credit score for one year.

Having multiple hard credit inquiries on your report is often a red flag to lenders. You may have to wait for past inquiries to fall off before seeking an approval for a new loan or line of credit.

It’s smart to prepare for a credit check beforehand by practicing financial stability. The more your credit is maintained, the less hard inquiries will negatively impact your credit report. Learn more about how to minimize the effects of a hard inquiry below.

How to minimize the effect of a hard inquiry on your credit report

Fortunately, it’s okay to have hard inquiries on your credit history from time to time. However, it’s important to be strategic with hard inquiries.

Here are some practices to consider when approving a hard inquiry:

Monitor your credit score. Checking your own credit score is considered a soft inquiry and won’t affect your score. Pay close attention to risk factors included with your score and why it might be dropping.

Improve your credit score. Maintaining a high or good credit score will better cushion the blow of a hard inquiry. Focus on making on-time payments and paying down your debt, including any past-due accounts.

Use prequalification tools to your benefit. Before applying for a loan, a pre-qualification tool can help estimate your chance of approval. For example, When you check your rate with Upstart, we use a soft pull to determine your loan options. So it’ll never affect your credit score. Our model can check your credit and pre-qualify you for loans
Avoid applying often. Applying for a lot of new credit in the span of several months can represent risky behavior to future creditors. It could appear like you’re seeking too many loans that you may be unable to pay back.

Pro tip: To find your best options, shop around and compare rates from a few different lenders in a shorter window of time. This process—known as rate shopping—allows you to make multiple inquiries without significantly impacting your credit score. Credit bureaus typically view multiple pulls made within 14 to 45 days as one inquiry.

How to dispute hard credit inquiries

You cannot remove a standard hard credit inquiry from your credit report.

But in certain cases, it is possible to dispute or remove an inquiry from your credit report. You may be able to remove a hard credit inquiry from your report if the pull was the result of one of the following:

Fraud
Identity theft
Some other error

Contact the credit bureau to file a dispute. If the dispute is accepted, your score will return to what it was before.

Start making meaningful impacts on your credit & finances

Knowing a hard inquiry can lower your credit score and temporarily set you back, it’s best to only use them when necessary. However, if you know a hard inquiry is in your future, consider implementing strategies to minimize its impact.

If you keep hard inquiries at a minimum and maintain a healthy credit score, they’ll likely have little to no long-term financial effects.

¹ Neither Upstart nor its bank partners have a minimum educational attainment requirement in order to be eligible for a loan.

Upstart Network, Inc. (NMLS #936133) is not a lender. All loans on its marketplace are made by regulated financial institutions.

All mortgage lending is conducted by Upstart Mortgage, LLC dba Upstart Home Lending. (NMLS #2443873). Equal Housing Opportunity.

Checking your rate won’t affect your credit score: When you check your rate, we check your credit report. This initial (soft) inquiry will not affect your credit score. If you accept your rate and proceed with your application, we do another (hard) credit inquiry that will impact your credit score. If you take out a loan, repayment information may be reported to the credit bureaus.
Upstart’s model considers education: Neither Upstart nor its lending partners have a minimum educational attainment requirement in order to be eligible for a loan.
41% more approvals and 33% lower rates than a traditional model: As of publication in April 2026, and based on a comparison between the Upstart model and a hypothetical traditional model using Upstart data from Jan – Dec 2025. For more information on the methodology behind this study, please see Upstart’s Annual Access to Credit results here.
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No annual fee, prepayment penalty, or fees to redraw: Terms shown here are subject to change without notice. Origination fee to open an account is between 0% and 4.99% of the approved credit limit. The Annual Percentage Rate (“APR”) is variable and based on the Prime Rate as published in the Wall Street Journal “Money Rates” table plus or minus a margin. Your APR will never be less than 3.99% or greater than 18.00%. Property insurance is required.
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