New Delhi, July 8 -- There are two kinds of credit inquiries. One is a 'hard inquiry', and the other is a 'soft inquiry'. When any person applies for a new personal loan, home loan, credit card or any other similar kind of credit, a 'hard inquiry' is generally initiated on their credit profile. This inquiry assesses the individual applicant's creditworthiness, repayment history and financial wherewithal to make timely repayments.

Several hard checks can, therefore, bring down credit scores and damage credit profiles. A 'soft inquiry', on the other hand, is different; this kind of inquiry generally takes place when an individual just checks their credit profile and in other similar cases where the profile is not analysed intensively by le...