Credit inquiries refer to requests for a person's credit report, which is a detailed summary of their borrowing history and financial standing. When someone applies for credit, such as a loan or credit card, the lender will typically request a copy of that individual’s credit report from one of the three major credit bureaus (Experian, Equifax, or TransUnion). This is known as a hard inquiry, and it can temporarily lower your credit score.
In addition to hard inquiries, there are also soft inquiries, which occur when someone checks their own credit report, such as through a free annual credit report request or when they apply for their own credit card. Soft inquiries do not affect the individual's credit score and are often used by lenders to pre-screen potential customers without impacting their creditworthiness.
Overall, credit inquiries play an important role in determining a person’s creditworthiness, as they provide insight into how responsible someone is with managing debt obligations.