Money Talks November 2020 | Stephanie Garcia

Not All Credit Tacos Are The Same

Not All Credit Tacos Are The Same

Ah, just like your favorite hand-held food, Credit Inquiries come in both Hard and Soft form. Pero unlike a soft taco or a hard taquito, 🌮 this isn’t just a matter of preference. Equifax helps us break down the difference.

HARD CREDIT INQUIRY

According to Equifax, a Hard Credit Inquiry 👷🏽‍♂️can happen when, say, you apply for a credit card 💳. A lender or company reviews su credito, which counts as a hit on your report. These can be malo for your credit score, just like your bite can crack that hard-shell taco. 🌮 Thinking that the impact of multiple hard inquiries is bad 😫is natural but Equifax points out that the impact may be mucho menor than the long-term benefits of finding a favorable loan. 📄 

One other thing to note is that multiple hard inquiries for a home mortgage or auto loan within a certain time frame are generally counted as solo uno inquiry.1️⃣ This time frame is usually somewhere between 14 and 45 days, but can vary, and allows you to check different lenders to find the best loan. (Like how you might go taco truck to taco truck scoping out lo mejor taco) All the inquiries show on your report but only one will actually impact your score, just like only the taco you choose will impact your appetite. 🌮 This exception doesn’t  generally apply to multiple credit card inquiries. 💳

 

SOFT CREDIT INQUIRY

A Soft Credit Inquiry 🧖🏽‍♀️on the other hand is kinda like a soft tortilla that keeps the ingredients secure with every bite. Que sabroso! 😋 According to Equifax, soft credit inquiries can happen with a promotional credit card offer or through existing lending account reviews by companies with whom you have an account. They are also brought on by you checking your own credit report. Pero, no te preocupes, these inquiries do not impact your score. 🙌🏽 Soft Credit Inquiries aren’t visible to potential lenders and stay on your report for 12 to 24 months depending. 🗓  

Also, according to Equifax, periodically checking your credit helps you monitor your account and find any suspicious activity that could mean identity theft. 🕵🏽‍♀️ It can also help discover inaccurate or incomplete info on your report. You’re entitled to a copy of your credit reports gratis every 12 months from each of the three nationwide credit bureaus.🗓 If you find inaccurate or incomplete info, contact the lending company directly or you can also file a dispute with the credit bureau providing the report.

Hard inquiries and soft inquires will both happen but knowing what each of them do to your credit report will help make the road to generational wealth a little less messy, unlike finishing those tacos you’re eating. Grab a napkin mij@!

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