For most millennials, building and maintaining good credit is essential. Whether you're looking to rent an apartment, get a loan, or even land a job, having a good credit score makes life a whole lot easier. If you're looking to improve your credit but have fair credit or unsure about the impact of a hard credit inquiry, soft pull credit cards might be your answer. In this guide, we'll explain what soft pull credit cards are, why they're perfect for those with fair credit, and provide some realistic examples. Let's get started!
Soft Pull Credit Cards For Fair Credit Table of Contents
Understanding Soft Pull vs. Hard Pull
When it comes to your credit, there are two types of credit inquiries: soft and hard pulls. Each type has different impacts on your credit score.
Soft Pull
A soft pull, or a soft inquiry, is when a lender or credit card company checks your credit report for pre-approval or background purposes. This type of inquiry doesn't affect your credit score and is visible only to you on your credit report. Examples of soft pulls include:
- Checking your credit score online
- Pre-approved credit card offers
- Landlords or employers conducting a background check
Hard Pull
A hard pull, or a hard inquiry, is when a lender or credit card company checks your credit report as part of their lending decision-making process. This type of inquiry can negatively impact your credit score, especially if you have several hard pulls within a short timeframe. Examples of hard pulls include:
- Applying for a credit card
- Applying for a loan
- Requesting a credit limit increase
Benefits of Soft Pull Credit Cards for Fair Credit
For those with fair credit, it can be challenging to find credit cards that offer favorable terms or approval without a hard pull on your credit report. Soft pull credit cards can be an excellent option, as these cards offer the following benefits:
- No Impact on Credit Score: Since a soft pull won't harm your credit score, applying for a soft pull card won't risk any further damage to your already fair credit rating.
- Pre-Approval Confidence: When a card offers pre-approval through a soft pull, it gives you a better idea of whether or not you'll be accepted – reducing the likelihood of being rejected after applying.
- Opportunity to Build Credit: These cards give you a chance to establish better credit habits and improve your credit score over time, which can open up more financial opportunities in the future.
Soft Pull Credit Cards For Fair Credit Example:
Let's say Anna has a fair credit score of 650. She recently graduated from college and is looking for ways to build her credit while still being mindful of the potential impact of hard credit inquiries. Anna begins researching soft pull credit cards and comes across the Flik EcoCard, a popular card specifically designed for individuals with fair credit.
Because the Flik EcoCard offers pre-approval with a soft pull, Anna is able to check whether she has a good chance of being accepted without risking damage to her credit score. After submitting her information, Anna receives a pre-approval for the card, and her credit score remains unaffected.
Once she's approved for the Flik EcoCard, Anna focuses on responsible spending habits – such as paying off her balance in full each month and keeping her credit utilization ratio low. Over time, her credit score begins to improve, opening up more financial opportunities for her in the future.
Congratulations, now you know what soft pull credit cards are and how they can provide a much-needed option for those with fair credit! By utilizing these cards, you can improve your credit score without the worry of hard inquiries further damaging your credit. Ready to take the next step in your financial journey? Check out Flik Eco for more great personal finance tips and resources. If you found this guide helpful, don't forget to share it with friends and help them better their financial future as well!
