Soft vs. Hard Credit Checks: What Business Owners Should Know

When you look for business financing, lenders usually check the owner's personal credit. How they check it makes a difference to your score.

Soft inquiries

A soft inquiry, or soft pull, lets a company review your credit without affecting your score. Only you can see soft inquiries on your report. They're commonly used when checking your options, for account reviews, and when you check your own credit.

Hard inquiries

A hard inquiry happens when you formally apply for credit and a lender pulls your full report to make a decision. Hard inquiries are visible to other lenders and can lower your score by a few points. They stay on your report for about two years, though their effect on most scores fades sooner.

Why it matters when shopping for funding

Applying to several lenders separately can mean several hard inquiries in a short period, which can signal risk and lower your score. Checking your options first with a soft inquiry lets you compare before you commit to a formal application.

Tips to protect your credit

• Ask whether a check is soft or hard before you authorize it
• Compare options with soft checks before formally applying
• Apply only for financing you're likely to qualify for and actually intend to take
• Review your credit reports and dispute any errors

With GoSwiftFund, checking your options won't affect your credit score. A hard inquiry happens later, and only if you choose to move forward with a lending partner's offer.