While depositing a cheque at the bank, the teller suggested that my client apply for overdraft protection.

As is the case with most, she kindly accepted the banks offer without question.

After watching the video below, she phoned back to the bank and asked if the they were doing a soft or hard inquiry? Go figure, back rep didn’t know what a hard or soft inquiry was.

After being transferred back and forth, she was finally told, YES a hard inquiry was done!

Go ahead and watch the video below…

Whenever you apply for credit in Canada, whether it be a mortgage in Vancouver, a credit card, a car loan, or any type of credit, an inquiry is made on your credit bureau.

This inquiry will likely affect your credit score.

But do you know the difference between and Hard Inquiry and a Soft Inquiry?

Today I’m going to explain the difference between a soft inquiry and a hard inquiry as it relates to your credit bureau score.

Lets start with a hard inquiry.

Anytime you apply for ANY type of credit, whether it be A car loan, a credit card, a mortgage and even sometimes a job or to rent a home, a credit check is done.

This credit check is considered a HARD credit Inquiry.

This hard inquiry results in your score being dinged.

Due to the confidentiality of the credit scoring model, there is no “guaranteed” point value for each credit inquiry but you can bet your bottom dollar that your score will be affected.

Now remember, even that department store credit card or that don’t pay for 6 months offer, they ALL result in a Hard Inquiry on your credit bureau and will likely affect your credit score.

And YES, even that overdraft protection results in a Hard Credit Inquiry.

A soft inquiry, on the other hand, does not affect your credit score.

This soft inquiry takes place when you check your own credit score.

Checking your own credit is a must and can be done here http://www.consumer.equifax.ca/home/en_ca

I suggest you do this At least once a year if not twice.

Remember, you can check your own credit score as many times as you like and it will not affect your score.

As you can see, there’s a lot more to mortgage than just great rates.

Mark Fidgett is a Vancouver mortgage broker and the driver behind www.NotaPennyDown.com

Your Vancouver Mortgage Broker For Life



P.S. Who’s the next person you know who wants to save thousands off their mortgage?
Be sure to give me a call so we can help them!