What is a credit check?
A credit check, also known as a credit search, is where a company looks at the information on your credit report to understand your financial behaviour and assess your creditworthiness.
Aside from credit providers your utility suppliers, banks and building society, letting agents and landlords, mobile phone companies and employers (employers won’t see your full report) can do a credit search on you.
What is a Soft Search?
A soft search or soft credit check is an initial look at certain information on your credit report. A company may perform a soft credit search to give them an indication as to how successful your application would be without doing a full evaluation of your credit history.
A soft credit search isn’t visible to companies so they have no impact on your credit score or any future credit applications you may make.
Examples of soft searches
- You search your credit report
- A company searches your report as part of an identity check
What is a hard search?
A hard search or hard credit check is when a company does a complete search of your credit report. Unlike in a soft search where only some of the information is looked at in a hard search everything is. Each hard search is reported on your credit file so any companies searching you will be able to see that you’ve applied for credit.
Too many hard searches over a short period will impact your credit score for six months.
Examples of hard searches
- When applying for a loan, credit card or mortgage
- You apply to a utility company
- you apply for a pay-monthly mobile phone contract