Run Your Credit

Run your credit summary:

To run your credit means to check your credit history.
Lenders and other companies run your credit to determine if they should give you a loan or do business with you.
You get an inquiry on your credit report when a lender runs your credit.

Run your credit definition and meaning

Run your credit means a lender or organization checks your credit history by requesting your credit report or credit score. When you apply for a loan, insurance, or another financial product, the lender or company you want to do business with will typically run your credit.

The purpose of a credit check is to find out more about your history as a borrower—how you’ve handled credit and the repayment of borrowed money. Lenders use your credit history to gauge the risk of lending you money now.

Key concept: A review of your credit profile to decide if you qualify for a loan and on what terms.

More on run your credit

A lender or creditor checks your credit report (and often your credit score) from one or more of the major credit bureaus: Experian, Equifax, or TransUnion. That means the lender makes a request for your credit history to find out how you’ve handled debt in the past.

The lender can do a hard inquiry, which generally means you've filled out an application for credit like a loan, credit card, or mortgage. If you haven't applied for new credit, then it will likely be a soft inquiry, which is common for pre-approvals or background checks.

A hard inquiry is associated with new credit accounts, so hard inquiries could ding your credit score. This is especially likely if you have multiple hard inquiries in a short period of time. A soft inquiry doesn't impact your credit scores.

Key attributes of run your credit

Here’s what happens when a lender or other company decides to run your credit.

Let’s say you want to do business with a company. That could mean you want to:

Apply for a loan or a credit card
Buy some type of insurance
Rent an apartment
Sign up for cell phone service or with a utility company

The next steps usually are:

You apply. You fill out a loan or credit application (mortgage, car loan, credit card, etc.).
You give permission. As part of the application, you authorize the lender to check your credit.
The lender requests your credit report. They contact one or more credit bureaus (Experian, Equifax, or TransUnion). They may also request a credit score.
The credit bureau sends the data. Your credit report contains records of your past (up to 10 years) and current credit accounts, including payment history and debt balances.
The lender performs a review. They look at your payment history, balances, accounts, and estimate your overall risk.
A decision is made. Based on what they see, the lender decides whether to approve you, how much to lend, and what interest rate to offer.
Impact on your score. A hard inquiry, or hard pull, could cause a small, temporary drop in your score that’s visible to other lenders.

In some cases, you may start with prequalification instead of a credit application. This is when the lender uses a soft credit check to look at your credit history and give you an idea of whether you're likely to be approved if you apply. Since it's not part of an application for credit, a soft credit check won't hurt your credit score.

Run your credit: a comprehensive breakdown

When a company requests your credit report, they’ll get details on your:

Payment history. This could show if you’ve been 30, 60, or 90 days late on payments. It also includes judgments and foreclosures as well as information on whether debt is paid in full or resolved through resolution as part of a debt relief program.
Credit utilization. This is the percentage of your available credit you're using.
Types of credit. This is the different types of credit products you have, like loans and credit cards.
Average age of your accounts. This shows how long you have had each credit account, as well as how often you open new accounts.
Inquiries. This tracks how many times a lender has run your credit, or checked your credit score in the past.

The company may also look at your credit score, in addition to the details of your payment history. Your credit score is a three-digit number that gives a snapshot of your overall credit history based on a special equation or model designed by a credit scoring agency.

Types of running your credit

When lenders run your credit, it may be a soft inquiry or a hard inquiry:

Soft inquiries don't impact your credit scores. These happen if you check your own credit or if your credit is checked as part of a background check or to find out if you qualify for a promotional offer.

Hard inquiries do impact your credit scores. You get a hard inquiry when you formally apply for credit. Too many inquiries could hurt your credit score. Hard inquiries stay on your credit report for two years, though the impact to your credit score can decrease over time.

Real-life example of run your credit

Here are two real-life examples of what happens when a lender or other company runs your credit.

Credit card

Dylan applies for a new credit card online. When he submits his application, he gives the bank permission to run his credit. The bank contacts Experian and pulls Dylan’s full credit report along with his credit score.

The report shows Dylan’s history of on-time payments, his current balances, and the total amount of debt he carries. Because this is a hard inquiry, Dylan’s score drops by a few points—nothing major, but enough to notice.

The bank decides he qualifies based on the information and offers Dylan a card with a $2,000 limit and a 21% interest rate.

Here, running his credit is the bank checking his credit history and score to decide whether to approve him for a credit card.

Renting an apartment

Jasmine wants to rent an apartment. As part of the rental application, she signs a form giving the landlord permission to run her credit. The property manager contacts a credit bureau and reviews Jasmine’s credit report to see how reliably she’s paid bills and handled debt.

Because this is a soft inquiry, Jasmine’s credit score isn’t affected. The landlord sees she’s made steady, on-time payments and approves her for the lease.

In this case, running her credit means the landlord checked Jasmine’s financial history to help decide if she’d be a reliable tenant.

Run Your Credit FAQs

What is a credit report?

A credit report details your past borrowing behavior. Equifax, Experian, and TransUnion are the three major credit reporting bureaus for U.S. consumers. Lenders report your borrowing and payment behavior to the credit bureaus, and the records are kept in your credit reports. Each credit bureau is independent, so you should check all three credit reports regularly for errors or mistakes.

How does information get on my credit report?

Lenders report details to the credit reporting agencies—Equifax, Experian, and TransUnion—about how much you owe, your credit limit, whether you’ve applied for new credit, and whether you have paid bills on time. Information also goes on your credit report from public records, such as records of court judgments and foreclosures.

How do I get a copy of my credit report?

You can get a free copy of your credit report from AnnualCreditReport.com for each of the three major credit bureaus, Equifax, Experian, and TransUnion. You’re entitled to this weekly You’ll need to provide your Social Security number and answer questions to verify your identity.