There are two kinds of inquiries that can occur on your credit report: “hard” inquiries and “soft” inquiries. While both types of credit inquiries enable a third party, such as a lender, to view the information in your credit report, only hard inquiries can negatively affect your credit score.

A soft inquiry typically occurs when a person or company checks your credit report as part of a background check or to make a prescreened offer of credit. A soft inquiry may be recorded in your credit report, depending on the credit bureau, but it does not affect your credit score. Upstart Mortgage performs a soft credit inquiry when you apply based on your name, address, and date of birth in order to determine your eligibility and your initial rate.

Hard inquiries generally occur when a financial institution checks your credit report when making a credit decision. Hard inquiries will impact your credit score and they may remain on your credit report for two years. Upstart Mortgage performs a hard inquiry after you accept your offer but before you sign your closing documents.