When you check your rate for a Payoff Loan, we perform a soft inquiry. A soft inquiry is when someone checks your credit report for any number of reasons (rent, background check, pre-approval, etc.), and it does not affect your credit score.
A hard inquiry is when a financial institution (a bank, Happy Money®, credit card or mortgage company, etc.) checks your credit report before giving you a loan. Unlike soft inquiries, hard inquiries can affect your credit score and remain on your credit report for two years. For added security, we do a hard inquiry right before your Payoff Loan is finalized to check for new unsecured personal loans as well as bankruptcies and delinquencies.
- A hard inquiry may impact your credit score, but the good news is Happy Money Members see an average increase of 40 points † to their credit score.
† Based on a study of Happy Money Members between March 2021 and August 2021. Happy Money Members, who paid off at least $5,000 in credit card balances, saw an average increase in their credit score of 40 points within four months of receiving a Payoff Loan. Results may vary and are not guaranteed.