Updated: April 2025  |  bremo.io financial guides

Hard Inquiries and Credit Score in Canada

A credit inquiry occurs whenever someone accesses your credit file. In Canada, there are two types: hard inquiries and soft inquiries. Hard inquiries affect your credit score; soft inquiries do not. Understanding the difference — and knowing when each type occurs — helps you make smarter decisions about when and how to apply for credit.

What Is a Hard Inquiry?

A hard inquiry (also called a hard pull or hard check) occurs when a lender or credit provider accesses your credit file to make a lending decision. Examples include:

• Applying for a credit card
• Applying for a mortgage or home equity line of credit
• Applying for a personal loan or line of credit
• Applying for an auto loan at a dealership or bank
• Requesting a credit limit increase on an existing card (depending on the issuer)
• Some landlord rental applications

A hard inquiry requires your consent. You typically give consent when you sign a credit application or authorize a credit check.

What Is a Soft Inquiry?

A soft inquiry occurs when someone accesses your credit file without it being tied to a formal credit application. Soft inquiries do not affect your score at all. Examples include:

• Checking your own credit score or report
• Pre-approval offers from lenders who check your file for marketing purposes
• Existing creditors reviewing your file periodically
• Some employment background checks
• Account monitoring through your bank app

How Much Does a Hard Inquiry Affect Your Score?

A single hard inquiry typically reduces your score by 5 to 10 points. This is relatively minor and recovers within 3 to 12 months as long as you do not apply for more credit. A single inquiry is not a significant concern for most people.

The concern arises when multiple hard inquiries occur in a short period. Several applications in one month sends a signal that you may be urgently seeking credit, which lenders interpret as financial stress. Each inquiry within the recent period compounds the impact.

Rate Shopping Exception in Canada

Canadian credit scoring models include an exception for rate shopping. When you are applying for a mortgage or auto loan and submit multiple applications to different lenders within a short window (typically 14 days), the scoring models treat those multiple inquiries as a single inquiry for scoring purposes. This allows you to shop for the best rate without being penalized for comparing lenders.

This exception applies specifically to mortgages and auto loans. Applying for multiple credit cards in the same week does not receive the same treatment — each card application counts as a separate inquiry.

How to Minimize the Impact of Hard Inquiries

• Only apply for credit when you genuinely need it
• Do your mortgage or auto loan rate shopping within a concentrated 14-day window
• Check your own credit score and report regularly — self-checks are always soft inquiries
• Before applying for a new credit card, confirm with the issuer whether approval involves a hard or soft inquiry (some fintechs offer soft-pull pre-approvals)
• Wait 6 to 12 months between significant credit applications when possible

Can You Remove a Hard Inquiry?

You cannot remove a legitimate hard inquiry before its expiry date. If you discover an inquiry you did not authorize — meaning you never applied for credit with that lender — you can dispute it with Equifax and TransUnion. Unauthorized inquiries could indicate someone has applied for credit in your name, which is a potential sign of identity fraud. Report this to the bureau and consider placing a fraud alert on your file.

Checking the Inquiries on Your Report

Your credit report from Equifax and TransUnion shows a list of inquiries with the lender's name and the date. Review this section when you pull your reports. If you see lenders you do not recognize or applications you did not make, investigate immediately. Legitimate hard inquiries you did authorize are simply part of your normal credit activity and will age off within 3 years.