Separating Credit Score Fact from Fiction

When it comes to credit scores, there’s no shortage of inaccurate information to be found online. While some misinformation is relatively harmless, other inaccuracies may be what holds you back, especially if you’re trying to rebuild your credit. So, let’s set the record straight on a handful of the most common credit myths.
 

Myth #1: Paying Off a Collection Removes It from My Report

Fact: While paying off a collection is a great move, it does not automatically erase it from your credit report. It’s typically visible for seven years from the original delinquency date, though the status will show as "paid."

Tip: Newer credit scoring models weigh paid collections significantly less than unpaid ones. Depending on the situation, you can also try writing a "goodwill letter" to the collection agency asking them to remove it.
 

Myth #2: Checking My Own Credit Hurts My Score

Fact: When you check your own credit, it’s considered a ‘soft inquiry’ and has zero impact on your score. As a member, you’ve got unlimited access to check your score using our Credit Monitoring tool.

Tip: Even the hard inquiries made by lenders when you apply for a loan only cause a small, temporary dip in your credit score that usually drops off within a year. Having a good account mix is more important for your score in the long term, which means applying for the occasional loan! Just try not to apply for too many at once.
 

Myth #3: Credit Repair Companies Can Do Things I Can't Do Myself

Fact: Anything a legitimate credit repair company can legally do, you can do yourself. That includes disputing errors on your credit report, writing goodwill letters, and negotiating settlements on debts.

Tip: You don’t have to do it alone! We’ve partnered with trusted national nonprofit GreenPath Financial Wellness to offer you free financial counseling, guidance, and educational resources. They’ve even got options if you’d like more hands-on assistance when tackling debt. Request a call today!
 

Myth #4: Closing Credit Cards Improves My Score

Fact: Closing a credit card, especially an old one, can hurt your score in two ways. First, it reduces your total available credit, which increases your utilization ratio. Second, if it's one of your older accounts, closing it can shorten your average credit age. Both are factors used to calculate your credit score.

Tip: If you're not using a card and you're worried about annual fees, call the financial institution and ask about product-changing to a no-fee version instead of closing the account. This will keep your credit age intact.
 

Myth #5: A Bad Credit Score Is Permanent

Fact: Credit scores are ever evolving. Negative impacts like late payments, collections, and even bankruptcies don’t last forever. Their impact fades over time, especially as you build new positive history on top of them.

Tip: With consistent effort, many people see meaningful score improvements within 12 to 24 months. We’ve got your back! Our Credit Monitoring tool also includes suggestions to improve your score, goal-setting and tracking, and a simulator to help guide your decisions. Plus, GreenPath is free and available to talk it all through!