Credit Inquiry

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Definition: Credit Inquiry

Credit Inquiry is a transaction in which a creditor or a financial body analyses an individual's credit report. This is done when individual applies for a debt like loans, mortgage, credits etc.

Mainly it is done to see whether the person in question would be able to repay or not.

Credit inquiries are of 2 types –

1) Soft 

2) Hard

A soft inquiry is mainly normal individual inquiries and other background checks.

A hard inquiry is done by lender or debtor who would go through previous credit history and reports. It affects credit score.

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