Credit Scores
Does Checking Loan Rates Hurt Your Credit?
Checking loan rates can be a smart way to compare borrowing options, but it is important to understand the difference between a soft credit inquiry and a hard credit inquiry before submitting your information.
Quick Answer
Checking estimated loan rates may not hurt your credit if the lender uses a soft inquiry. However, submitting a full loan application may involve a hard inquiry, which can affect your credit score. Always ask the lender whether checking rates uses a soft inquiry, hard inquiry, or no credit check.
What Is a Soft Credit Inquiry?
A soft credit inquiry, sometimes called a soft pull, is a credit review that generally does not affect your credit score. Soft inquiries may happen when you check your own credit, when a lender provides an estimated prequalification, or when a company reviews your credit for certain promotional offers.
Many loan comparison or prequalification tools advertise soft credit checks, but you should still read the details before submitting your information.
What Is a Hard Credit Inquiry?
A hard credit inquiry, sometimes called a hard pull, usually happens when you apply for new credit. This may include applying for a personal loan, auto loan, mortgage, credit card, or another type of financing.
A hard inquiry may affect your credit score. The impact is often temporary, but it can still matter if you are close to a lender's credit score cutoff or planning to apply for major financing soon.
Soft Inquiry vs. Hard Inquiry
Soft Inquiry
- Usually does not affect your credit score
- May be used for prequalification estimates
- May happen when you check your own credit
- Can be useful for early loan research
Hard Inquiry
- May affect your credit score
- Often happens during a full loan application
- Can appear on your credit report
- May matter more if you apply for many types of credit
What About Rate Shopping?
Credit scoring models may treat multiple inquiries for certain loan types as one inquiry when they happen within a short period of time. This is often called rate shopping.
Rate shopping rules can vary by credit scoring model and loan type. Auto loans, mortgages, and student loans are commonly discussed in rate-shopping windows. Personal loans may not always be treated the same way, so it is smart to ask lenders how their process works before applying.
Questions to Ask Before Checking Rates
- Will this use a soft inquiry or hard inquiry?
- Is this only a rate estimate or a full application?
- Will my information be shared with lenders or partners?
- Is the estimated APR guaranteed or subject to change?
- Are there origination fees, closing costs, or dealer fees?
- How long is the estimated offer valid?
How to Compare Loan Rates More Carefully
When comparing loan options, look beyond the monthly payment. Review the APR, repayment term, fees, total interest, and total amount you may repay over the life of the loan.
A lower monthly payment can sometimes come from a longer repayment term, which may increase the total interest paid over time. That is why it helps to compare the full loan cost before deciding.
Preview Possible Loan Estimates
Use our free credit score loan estimate tool to explore possible loan ranges based on credit score, loan type, and estimated borrower information.
Try the Credit Score Loan Estimate ToolFrequently Asked Questions
Does checking my own credit hurt my score?
Checking your own credit is generally considered a soft inquiry and does not usually affect your credit score.
Does prequalification hurt my credit?
Prequalification may use a soft inquiry, but that depends on the lender or platform. Always confirm whether the process uses a soft inquiry, hard inquiry, or no credit check.
Can multiple loan applications hurt my credit?
Multiple hard inquiries can affect your credit. Some credit scoring models may group certain loan inquiries within a short rate-shopping window, but rules can vary by loan type and score model.
Should I compare APR or monthly payment?
Compare both. APR helps show borrowing cost, while the monthly payment helps you understand whether the loan may fit your budget.
Important Disclaimer
MYLOANPREVIEW is not a lender, bank, credit bureau, credit repair company, or financial advisor. The information in this guide is for educational purposes only and should not be considered financial, legal, tax, or credit advice. Credit inquiry treatment, credit score impact, loan estimates, APRs, loan amounts, fees, repayment terms, and approval decisions vary by lender, credit scoring model, and individual financial situation.