When it comes to applying for a mortgage, many potential homebuyers are concerned about the impact on their credit score. One question that frequently arises is whether Rocket Mortgage does a soft pull or a hard pull on your credit. Let’s dive into this topic and explore what you need to know.
Understanding Soft and Hard Pulls
Before we discuss Rocket Mortgage specifically, let’s clarify the difference between a soft pull and a hard pull. These terms refer to the type of credit inquiry performed by lenders.
A soft pull, also known as a soft credit check, is a preliminary evaluation that does not affect your credit score. This type of inquiry is typically done for informational purposes, such as pre-qualification or pre-approval. Soft pulls can be initiated without your explicit permission and often occur when you check your own credit or when a lender wants to assess your creditworthiness. Importantly, soft pulls are not visible to other creditors or negatively impact your credit score.
A hard pull, on the other hand, is a more comprehensive review of your credit history. This type of credit check can impact your credit score and is usually conducted when you apply for a loan or credit card. Hard pulls require your authorization, and multiple hard inquiries within a short period may have a slightly negative effect on your credit score. It’s essential to be mindful of the potential impact of hard inquiries when shopping around for loans and mortgages.
The Rocket Mortgage Approach
Rocket Mortgage, a subsidiary of Quicken Loans, is an online lender that offers a convenient and streamlined mortgage application process. When applying for a mortgage through Rocket Mortgage, they start with a soft pull on your credit. This soft pull, also known as a pre-qualification, is a quick assessment of your creditworthiness based on the information you provide. It helps you understand how much you may be eligible to borrow and the terms you might qualify for.
If you move forward with Rocket Mortgage and formally apply for a loan, they will then conduct a hard pull on your credit. This hard pull is necessary to verify the information provided during the pre-qualification stage and to finalize your mortgage application. It’s worth noting that the hard pull may have a minor impact on your credit score, usually around five points or less.
The Benefits of a Soft Pull
The soft pull conducted by Rocket Mortgage during the pre-qualification stage offers several advantages. Firstly, it allows you to get an idea of your borrowing potential without any negative impact on your credit score. This preliminary assessment is helpful for planning and determining your homebuying budget.
Additionally, the soft pull enables Rocket Mortgage to offer personalized loan options and terms tailored to your specific financial situation. This allows you to compare different mortgage products and choose the most suitable one for your needs.
Frequently Asked Questions On Does Rocket Mortgage Do A Soft Pull : Unveiling The Truth Behind Mortgage Inquiries
Does Rocket Mortgage Perform A Soft Pull?
Rocket Mortgage does perform a soft pull when you check your eligibility for a mortgage. It doesn’t impact your credit score.
How Does A Soft Pull Affect My Credit Score?
A soft pull, like the one performed by Rocket Mortgage, doesn’t affect your credit score. It’s just a preliminary check.
Can I Check My Eligibility For A Mortgage Without Affecting My Credit?
Yes, you can check your eligibility for a mortgage with Rocket Mortgage without any impact on your credit score. It’s a soft pull.
What Are The Advantages Of A Soft Pull For Mortgage Approval?
A soft pull for mortgage approval offers the benefit of knowing your eligibility without any negative impact on your credit score.
Conclusion
When it comes to Rocket Mortgage, they perform a soft pull during the pre-qualification stage, allowing you to explore your borrowing options without affecting your credit score. However, if you proceed with a formal mortgage application, they will conduct a hard pull, which may have a minor impact on your credit score. Understanding the difference between soft and hard pulls can help you make informed decisions when applying for a mortgage.
Remember, keeping a close eye on your credit report and managing your overall credit health are crucial steps in the homebuying process. By using Rocket Mortgage’s online platform, you can take advantage of the convenience and transparency it offers, while staying informed and in control of your credit score.
Ismail Hossain is the founder of Law Advised. He is an Divorce, Separation, marriage lawyer. Follow him.
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