St. Louis used car dealers look at credit reports all the time. Sometimes it can seem like an all day affair. And one of the things we hear all the time is a question about the difference between a hard inquiry and a soft inquiry into your credit. Most people are familiar with the idea that credit inquiries hurt your score, but few people understand the subtleties of each type.

Soft inquiries are typically the ones that happen without your knowledge or permission. In general, a soft inquiry does not affect your credit score. Which is good since these soft inquiries usually happen without you knowing about it. This usually happens when a credit card company is considering sending you an offer, a bank is considering raising your credit limit, or things like that.

Checking your own credit is typically a soft inquiry as well. Each of the three major credit reporting bureaus is obligated to give you a free credit report each year, which is not supposed to harm your credit score.

Hard inquiries are different. A hard inquiry does impact your credit score. If you only have the occasional hard inquiry, it’s not much to worry about. If you have a good credit score, you can afford to be equally at ease about hard inquiries. Trouble starts when you have pre-existing bad credit, or lots of hard inquiries.

It’s best practice to avoid many hard inquiries. And thankfully, you can usually control most of them. Since you need to give permission for a hard inquiry to occur, you’ll usually know when one is about to happen. A good rule of thumb is to ask whether a certain institution is about to perform a credit inquiry, and decide whether it’s worth the ding to your report.