Our story started 14 years ago at one of the largest credit repair law firms in the country. Often referring to themselves as the “800lb Gorilla” in the space, which was great for the business. For the consumer, though, this meant that there weren’t many other options–you could either pay the extremely high fees and deal with poor customer service, or just try to live with bad credit.
They’ve been beating the same tired drum for years : “Denied for Credit? Get the credit you deserve.” But in the small print, you’d see that the “credit you deserve” would cost you hundreds or even thousands of dollars. The housing crash in 2008 caused changes that made it really difficult for anyone to get credit. This pushed Americans to credit repair services in masses. Years later, lending started to loosen up and the growth for credit repair began to slow. The slow growth was coupled with fear and an internal message that “Another recession could be good for business.”
Our hearts sank with the realization that our current employer was not living up to what they were promising and had no plans to. It’s like they were offering to save the lives of passengers on a sinking ship with lifeboat in exchange for their life jackets AND their life savings. Are they helping them? Yeah, maybe. Are they still jerks? Most definitely. It’s one thing to help people in a crisis. It’s another to wish for a bigger crisis in order to line your own pockets. We could not be a part of something that was clearly preying on the misfortune of others.
It’s one thing to help people in a crisis. It’s another to wish for a bigger crisis in order to line your own pockets.
Customers Deserve to be Heard
Our passion for the customer had been building over the years of getting to know them. Talking to them, understanding their challenges, motivations, and needs. We really grew to love them and wanted to find anyway possible to solve the problems they were facing. We have a passion to look after those that don’t have a voice in a system that controls how they are represented and judged as a consumer. Their information is in the hands of large corporations like the Credit Bureaus and creditors who are profiting off of it. Although existing credit repair companies claim to be an advocate for the customer, they are more noise in a room of loud talkers.
Hatch is Different
We are a team that knows and understands you. We believe we have created something different. Credit Repair that is honest, affordable, and easy to understand. We don’t want to add to the problem, we want to be a shining light for you. If you’re not sure if credit repair is the right choice for you at this point in your life, we encourage you to sign up for our free service and let us show you how much we care. We’d be thrilled to add you to our circle of friends.
That Negative Item is Accurate…Can it Still Be Removed?
We get this question all the time. What if I really did miss that payment? Can it still come off my report? The short answer is, yes. It can. It’s important that the information in your credit report is not just accurate, but also fair and verifiable. There are tons of examples of an item being accurate, but being removed from a report.
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Credit Isn’t Standard
As convenient as it would be for the credit bureaus, the thing about credit is that it’s incredibly personal and nuanced. In America, about 224 million people have a credit file! It’s silly to think that there won’t be exceptions to the reporting rules when you’re dealing with that many people.
Life Happens
Imagine you are in the military, and while deployed you get a bill in the mail you weren’t expecting. Months go by and you come home to find the bill. You quickly pay it, but the damage is already done. The creditor has reported you to the bureau, or they’ve sold that debt to a creditor, or worse, both. Sure, you were 30, 60, maybe 90 days late on a bill, and yeah, maybe the fact is that you had an account go to collections, but is that a fair representation of you as a borrower? Absolutely not. Hatch can help in situations like this to work with the creditors and bureaus to challenge ‘accurate’ information to try to get it removed from your credit reports.
Hatch can help in situations like this to work with the creditors and bureaus to challenge ‘accurate’ information to try to get it removed from your credit reports.
What if you had a mortgage with your spouse and you decided to get a divorce. In the divorce your ex was assigned responsibility for the mortgage, but missed a payment while your name was still on the account. Is it fair that the missed payment shows up on your credit report? Even if your name was on the account and it was legitimately a missed payment? Of course not.
Just because an item is accurate doesn’t mean it belongs.
We’ve Seen it All
These are just two examples, but we’ve seen many others that warrant a negative item being removed from someone’s credit report despite the item being factually accurate. There are a lot of strategies to attack these types of items. Give us a chance to help you, don’t assume it’s hopeless.
The credit bureaus make millions of dollars by buying and selling your personal information. At Hatch we believe that they should be able to understand your situation and we plan to ask them the hard questions to make sure they’re portraying you in a fair manner. We don’t want to fit into the ecosystem the way it’s built, we want to shake it up on your behalf.
Sign up today and let us know what was going on in your life when these negative items showed up on your report. We’ll work with you to come up with a tailored approach for how to improve your credit.
FICO vs. Vantage: What’s the difference, and why does it matter?
Posted on
24 September 2021 by Hatch Staff
We get it. You’re hanging out with your friends on a Friday night, there’s a lull in conversation, and you all find yourselves wondering the same thing: What are the differences between FICO and Vantage and what does it mean for my credit score?
We’ve been there. And we’re here now.
The Fair Isaac Corporation has been grading credit since 1989. Since then, lenders have been using FICO scores to make all sorts of determinations about you. Are you a good investment, will you make payments on time, how much should they charge you for credit, what do you need those 10 cars for anyhow? Well, now there’s a new sheriff in town: VantageScore. :cue tumbleweed: :also shootout:
Does it matter? A little. Should you care? Maybe sometimes.
Do read on.
Both FICO and VantageScore use the same type of information (consumer credit reports) from the same sources of information (the credit bureaus Experian, Equifax, and TransUnion) to come up with models and formulas using algorithms and maths and stuff that spit out personal credit scores across the same range (300 to 850).
So, pay your bills on time, don’t maintain high account balances, and only apply for credit you need.
The differences come in the way they interpret their data and that difference can matter in a big way to you. Depending on which score a lender uses, this could mean approval or denial for the things that you want.
Let’s break down that data by the factors that make up your credit score.
Score Factors
Credit History
VantageScore doesn’t require as long of a credit history or activity on record at a credit reporting agency as recently. What does that mean? People who don’t even qualify for a FICO score (those who are new to credit or haven’t been using credit lately) can get credit ratings from Vantage. Look at this fancy table we made:
Inquiries
When you apply for credit, lenders will pull your credit file. This is called a hard inquiry. Which means it becomes part of your credit report. Too many hard inquiries and your credit score can be negatively affected. There is a certain window, though, that allows consumers to shop around for the best rate when applying for credit. During this window, all inquiries are treated as one. They actually call this “deduplication”. We think they could have come up with something better like…“amalgamating” or “fusionizing” or “mergemixing” but, whatever, we’re not in charge. We just like to challenge those in charge.
FICO’s window is 45 days but only covers mortgages, auto loans, and student loans. FICO also includes a buffer where hard inquiries in the past 30 days won’t show up on your current credit score. VantageScore limits their deduplisimplification efforts to 14 days but then includes all types of hard credit pulls (even credit cards).
Utilization
When lenders pull your credit score, they see a snapshot of your credit utilization — what your current account balances and credit limits are. In other words, how much of your available credit you are using at the present time. This is the information FICO relies on. The most recent version of VantageScore, on the other hand, looks back at your history of utilization and generates trends based on patterns of behavior. Getting smarter all the time. Not us. Them. Well, it. And you.
Late Payments
There’s no hiding it, late payments hurt. While FICO is an equal opportunity penalizer of late payments (…it treats all late payments the same), VantageScore gives more weight to late mortgage payments. So it is possible for your FICO and Vantage scores to look different depending on the type of late payment.
Collections
When credit balances go unpaid they eventually get sent to collection agencies. When this happens, your credit score suffers. When calculating credit scores, some FICO scores ignore collection balances originally below $100 as well as those that have already been paid off. VantageScore only ignores paid collection accounts.
End Game
While it’s helpful to understand the differences between methods for scoring credit, both FICO and VantageScore occasionally adjust their scoring models (VantageScore has versions 3.0 and 4.0, FICO has versions 8 and 9, with 10 and 10T on their way this summer…you get it), and lenders sometimes use their own calculations. :face palm: You can check your credit score at annualcreditreport.com for free. Don’t panic when your score looks a little different between sites. Remember, we talked about this…algorithms. The most important thing to keep in mind is that, ultimately, the same factors affect them all. So, pay your bills on time, don’t maintain high account balances, and only apply for credit you need. When that doesn’t work, try us.
Credit reports end up being the thing you’re judged by when you go to borrow money from a lender. What a credit report does is keep track of the different types of accounts you’ve requested, opened, and the payment history for each of those accounts. It is important that the information in your credit report is a fair and accurate representation of you as a borrower so that you keep yourself eligible for the loans, jobs, apartments, cards, etc. that you apply for.
Credit reports, for the most part, are maintained by three different credit bureaus. Equifax, Experian, and TransUnion are the bureaus that collect information from various creditors, store that data, and then make it available for sale to lenders to help them make informed decisions. The information stored on each of these reports could be, and oftentimes is slightly different. It’s important to understand what is on each of those reports individually, and because of that you’re able to get them each free once per year at annualcreditreport.com.
Credit reports, for the most part, are maintained by three different credit bureaus. Equifax, Experian, and TransUnion are the bureaus that collect information from various creditors, store that data, and then make it available for sale to lenders to help them make informed decisions.
Information in a credit report
Let’s dive into the different types of information that are found in your credit report and hopefully get some understanding of how it can impact your credit score.
1. Personal Identifying Information
Personal Identifying Information (PII) in a report would be things like your name, birthday, address, social security number, and employment information. This information is generally gathered from applications when you apply for credit with a lender. PII isn’t generally used when calculating your credit score and can sometimes be inaccurate.
2. Inquiries
There are two types of inquiries depending on why your credit was pulled. A soft inquiry happens when your credit is pulled without the intent of lending credit. For example if someone pulls your credit for a job, or you pull your own credit report. Sometimes credit card companies pull a credit report to prequalify you for an offer, and that also counts as a soft inquiry. Soft inquiries don’t hurt your credit scores the way a hard inquiry does. A hard inquiry happens when a lender pulls a report to see if they want to issue you credit. If you’re applying for a car, house, apartment, or credit card, the lender will get a copy of your report and that inquiry will be what’s called a “hard pull.” Hard pulls take two years to fall off your report, and can negatively impact your credit score. Generally the scoring systems have logic that don’t ding you for multiple hard pulls for a car or a house in a short time if you’re shopping for a rate, and usually the inquiry only hurts your score for the first year it is on your report. Inquiries on a credit report can also be disputed, and Hatch has a tool to help you dispute inquiries that were made without your explicit permission.
3. Credit Accounts
These are the accounts you probably generally think of being on a credit report. Car loans, credit cards, mortgages, and student loans. Credit accounts fall into one of two categories. Revolving, which is a loan you can borrow from over and over again up to a certain limit, think of your credit cards. The second type is an installment loan, where you borrow a fixed amount and make steady payments over a predetermined set of time in order to settle the loan. This would be something like a car loan. This part of the report will include the name of the creditor, your account number with that lender, any balances, the account status, and the payment history for the account. This is where in a report you’d find the derogatory marks of a 30, 60, 90, or 120 day late payment. Most of the scoring algorithms weigh this part of the report the heaviest. FICO, which is the score that 90% of lenders use, says that payment history makes up 35% of their score. Missing a payment can have a huge impact on your credit score. Hatch works with the three bureaus and your creditors to ensure that any late payment on your report can be substantiated, is accurate, and is fair. If there are late payments on your report, help us understand what was going on at the time and we’ll come up with a plan that works for you.
4. Collections
When an account goes unpaid, a creditor can send that account to collections. In addition to credit accounts, you might find an unpaid bill in this section of your report. This can include bills from doctors, retail stores, cell phone companies, cable providers, and more. Collections accounts may also show as charged-off meaning that the creditor has given up on collecting the debt. An account in collections can remain on your report even after it has been paid in full. Accounts that show in this part of a report can remain on your report for up to 7 years and are generally very detrimental to your credit score. Hatch has seen a lot of success in handling these types of accounts, including working closely with creditors to ensure that the debt is valid and owed by you and asking hard questions about their legal right to collect and record these types of debts. If you have an account in collections, let us help you get your voice heard by the bureaus and your creditor. Even if the collections account is accurate we can help make sure it’s fair and justifiable.
5. Public Records
This part of the report had a recent change. Previously judgements would be included in the public records, but now only bankruptcies show up on the credit report. There are two types of bankruptcies, chapter 13 which generally falls off a report after seven years, and chapter 7 which generally stays on a report for 10 years. Bankruptcies can obviously have a huge impact on your score, but it doesn’t have to be the end of your credit journey. Not only has Hatch seen success in getting bankruptcies removed from reports prior to the 7 or 10 year thresholds, but we’ve also built successful strategies to help rebuild your credit after filing for bankruptcy. If you’re wondering how to handle such a tradeline on your report, please don’t hesitate to see how we can help.
Conclusion
Credit reports contain lots of information from many different sources, and the hodgepodge of all that data can often result in errors. This is why it’s so common to see our competitors harp on that one message ‘there might be errors on your credit report, we can help.’ It’s important to understand that your rights as a consumer and borrower extend beyond just accuracy. Creditors passing on your information to the bureaus, and the bureaus selling that information back to lenders means lots of your information is being spread around without your oversight. If that’s how these institutions want to make their money, they need to be ready to answer the questions we have about the validity and fairness of what they’re saying. Hatch wants to help you have a voice in that discussion. If your score or report is being impacted by one of these negative accounts, please join our little family so we can show you how helpful we can be.
