What is a Soft Credit Search?

Woman using mobile device to check credit

Not all credit searches by lenders or third parties leave a visible ‘footprint’ on your credit report. A soft credit search, also known as a soft credit check, is not visible to third parties on your credit report. Credit eligibility tools, offered by websites like Money Saving Expert or by high street banks, can check how likely you are to have your application accepted without performing a formal, or hard search article.

What Happens to My Credit Report When there is a Soft Credit Search?

Sometimes, instead of making an in-depth search into your credit history, a company offering credit may want to ask you about some of your credit history. This is usually information you’ve provided and doesn’t require the company to dig deeper. While these kinds of searches may appear on your credit report, they are unlikely to affect your credit score.

How Does a Soft Credit Search Work?

There will be times when you need to shop around for something that needs a credit check. That’s when you may need to use a comparison website to find which credit offers are good for you. Soft credit searches tend to be based on information that you give, to get an idea of whether or not you’re eligible to get credit. This could include information used to identify you as well as information used to determine affordability by the lender.

An example of a soft credit search is getting a ‘mortgage in principle’, A mortgage in principle allows you to look into the kind of mortgage you can get from a lender based on your circumstances at the time. It’s especially useful if you’ve considered a mortgage previously, and need to check if you can get a better deal.

Should you find the right deal, perhaps for a mortgage or a credit card, you can then make a formal application. A formal application will mean the company you’ve applied to will look into your credit history using a hard credit search. Bear in mind that if you have been accepted on basic information that you have given for a soft credit search, it’s still possible that a credit application may not be successful following a hard credit search.

What is a hard credit search?

While a soft credit search is based on information you’ve provided, a hard credit search is made by a third party. Organisations that make hard credit searches can include banks and other financial services, letting agencies and utility companies. By making a hard credit search, these organisations can go into your credit report and see if you represent a credit risk. Hard credit searches also appear on your credit report and can affect your credit score.

If you are interested in checking details of your credit history, including past credit searches, you can get online access to your credit report with your Equifax Credit Report & Score, which is free for 30 days and £14.95 a month thereafter.

This article was written on 24 August 2021; all information was correct at the time of writing. Now that you’ve read about soft credit search, read our article on hard credit searches.

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