Freezing your credit can be a smart move if you’re worried about identity theft. It limits who can access your credit report and may help stop scammers from opening accounts in your name.
New credit applications typically rely on hard credit inquiries. Soft credit inquiries, on the other hand, may still happen while your credit is frozen.
Let’s explore what credit freezes are and how soft and hard credit inquiries work when your credit is frozen.
What is a credit freeze?
A credit freeze is a free security measure that can help protect your finances. It may help prevent fraud by stopping new loans and lines of credit from being opened in your name.
To freeze your credit, you’ll have to contact the 3 major consumer credit bureaus online, or by phone or mail. Each bureau has its own freezing and unfreezing procedures, so the exact steps may vary. You may have to provide documents verifying your identity (like a Social Security card or pay stubs) to freeze your credit.
While your credit is frozen, you can still check your own credit report for free with each bureau once every 12 months and you may be able to take advantage of the free weekly credit reports.
What is a soft credit inquiry?
A soft credit inquiry gives someone access to your credit report without impacting your credit score. You may also see this referred to as a “soft credit check” or a “soft credit pull.”
Several situations might trigger soft credit inquiries. For example, card issuers may use soft credit checks to pre-screen you for new credit cards. Landlords and insurers may use soft credit pulls to evaluate your rental application or underwrite your policy. You may also initiate soft credit checks when you use pre-qualification to find loans or credit cards you may qualify for.
Soft credit inquiries may still happen if your credit is frozen, since credit freezes don’t completely stop access to your credit report – they keep lenders from running hard credit inquiries when you apply for new credit.
Soft vs. hard credit inquiry
There are several key differences between soft and hard credit inquiries. For example:
- Prompts: Soft credit checks may happen for a variety of reasons, while hard credit inquiries generally only occur when you apply for new credit.
- Permissions: Soft credit checks may happen without your knowledge, while hard credit inquiries generally require your permission.
- Credit score impact: Soft credit inquiries don’t impact your credit score, while hard credit inquiries do have a small impact. Hard inquiries can lower your credit score by a few points for about a year and may stay on your report for up to 2 years. Soft credit inquiries can stay on your credit report for up to 2 years.
When you apply for new credit, the lender generally performs a hard credit inquiry to help evaluate your creditworthiness. If your credit is frozen, however, they won’t be able to complete that step. They may pause the application or reject it.
Can you apply for the Costco Anywhere Visa® Card by Citi if your credit is frozen?
Let’s say you’re a Costco member who’s interested in applying for the Costco Anywhere Visa® Card by Citi. You’ve researched the card’s cash back rewards opportunities, like 3% back on restaurants and eligible travel, and see that they’re a great fit with your spending habits. Now you’re ready to apply, but your credit is frozen.
