When you apply for a loan or credit card, the lender reviews your credit history before approval. This process is known as a credit inquiry. But did you know that certain types of inquiries, called hard inquiries, can lower your credit score?

In 2025, with increasing credit card offers and digital loan apps, understanding the role of inquiries has become more important than ever. Let’s explore how hard inquiries affect your credit profile and what you can do to manage them wisely.

🔹 Types of Credit Inquiries

There are two kinds of inquiries:

  1. Soft Inquiry (Soft Pull)

    • Occurs when you check your own credit score, or when lenders pre-approve offers.

    • Does not affect your credit score.

    • Examples: Checking your score on DueFactory, employer background checks, or pre-approved credit card offers.

  2. Hard Inquiry (Hard Pull)

    • Happens when you apply for a loan, credit card, or mortgage.

    • Can temporarily lower your score by a few points.

    • Lenders use it to decide your creditworthiness.

🔹 How Hard Inquiries Affect Your Score

  1. Short-Term Score Drop
    A single hard inquiry usually reduces your score by 5–10 points. While this impact is temporary, multiple inquiries in a short period can add up.

  2. Signals Risky Behavior
    Many hard inquiries within a few months may signal financial stress or aggressive borrowing, making lenders cautious.

  3. Remains on Report for 2 Years
    Hard inquiries stay visible on your credit report for 24 months, but only impact your score for about 12 months.

  4. Affects Loan Approvals
    Too many recent inquiries can reduce your chances of getting a loan, even if your credit score is decent.

🔹 How to Minimize the Impact of Hard Inquiries

1. Apply Selectively
Don’t apply for multiple loans or cards at the same time. Research well and apply only when you’re confident of approval.

2. Use Pre-Approval Offers
Instead of directly applying, check pre-approved credit card offers that use soft pulls and don’t affect your score.

3. Compare Lenders Beforehand
Do your research on interest rates, eligibility, and offers before applying, rather than applying at multiple banks.

4. Monitor with DueFactory
Using DueFactory, you can see recent inquiries, active vs. inactive accounts, and overall credit trends, helping you plan smarter.

🔹 FAQs

Q1. How many hard inquiries are too many?
More than 3–4 hard inquiries in a year may raise red flags for lenders.

Q2. Do hard inquiries affect everyone equally?
No. If you already have a strong score (750+), the impact is smaller compared to someone with a low or average score.

Q3. Can I remove a hard inquiry from my credit report?
Legitimate hard inquiries cannot be removed. However, if you spot an unauthorized inquiry, you can dispute it with the credit bureau.

Q4. How long should I wait before applying again after a hard inquiry?
It’s best to wait at least 3–6 months before making another credit application.

Q5. Do multiple inquiries for the same loan count separately?
In some cases (like home loans or auto loans), inquiries within a short period may be treated as one inquiry to allow rate shopping.

🔹 Final Thoughts

Hard inquiries are a normal part of credit applications, but too many can hurt your credit score and loan eligibility. The good news is that their impact is temporary and can be managed with smart planning.

By monitoring your inquiries, utilization ratio, and credit history through platforms like DueFactory, you can stay in control of your credit journey in 2025.

Remember: Applying wisely is the key to maintaining a healthy score.