At Hatch, we talk to people every day who are working hard to build and protect their credit. And guess what? We hear a bunch of the same credit myths come up over and over again. Let’s tackle the most common we’ve heard from our Hatch community. And, let’s finally set the record straight.
📅 Myth #1: Items must stay on your credit report for 7 years.
This one’s everywhere, and we totally understand why! The Fair Credit Reporting Act (FCRA) says that most negative items can’t stay on your credit report for more than seven years (or ten years for bankruptcies). But here’s the key, the FCRA doesn’t say they have to stay for that long, it only says they can’t stay for longer than that.
That means items like collections, late payments, and other negative marks can be removed earlier, and especially if they’re inaccurate, unfair, or can’t be verified by the credit bureaus. At Hatch Credit, we’ve seen countless examples where clients’ credit reports were cleaned up well before the seven-year mark.
For example, Alex W. had a collection account reporting on his credit report. By working with Hatch to challenge the validity and fairness of the item, Alex got the collection removed in just a few months, long before the seven-year clock ran out.
💸 Myth #2: Paying off a collection account will instantly boost your credit score.
Hatch Credit customer Jamie N. recently shared, “I paid off a collection last year thinking my credit score would jump overnight, but nothing happened. I didn’t realize the paid collection would still be reported on my credit and continue to drag my score down.”
Jamie’s story is a common one around here, we hear it from tons of our community. Paying off a collection is a responsible move, and we definitely recommend doing it (plus it stops those annoying collection calls). But it doesn’t always result in an immediate score increase. That’s because paying the debt just changes the information in the collection, marking it paid, but the collection (even paid) is still there on the report, hurting your credit score.
To truly improve your score in a meaningful way, the best approach is to get the collection removed from your report entirely.
🔍 Myth #3: Checking your own credit hurts your score.
Maria R. told us, “I was so worried about pulling my credit because I thought it would drop my score. Turns out, checking your own report doesn’t hurt at all, and it actually gave me more confidence to work on my credit.”
This one causes so much unnecessary worry. When you check your own credit report, it’s considered a soft inquiry, and it does not hurt your score. In fact, it’s a good idea to check your report regularly to make sure everything is accurate and up-to-date. When you sign up for Hatch Credit we pull all three of your credit reports with you and walk you through what’s on each of them. With no harm to your credit score.
📊 Myth #4: You only have one credit score.
Ben M. came to us confused: “I checked my score on Credit Karma and it was 680. Then when I applied for a loan and the lender pulled a 650 score. How can they be different?”
This one comes up so often it was one of our very first blog posts. The reality is that you have dozens of credit scores, depending on the scoring model (think FICO vs. Vantage) and what lenders are looking for (think credit card vs car loan vs mortgage). That’s why your score might look different depending on when and where you check it.
📝 Myth #5: You can’t remove accurate items from your credit report.
This myth trips up so many people. Just because something on your credit report is accurate doesn’t necessarily mean it’s fair or verified. Hatch believes your credit report should be an honest, just, reflection of who you are as a borrower.
A great example came up in a recent product review from Laura S., “I was in the military and missed a payment while I was deployed. Sure, it was accurate, but I didn’t feel like it was who I am as a borrower. Hatch helped me challenge it and it did come off my report.”
Let’s Keep Busting Those Myths
Credit doesn’t have to be confusing. At Hatch, we’re here to help you understand the system, challenge what’s unfair, and build the credit you deserve.
Visit hatchcredit.com to learn more and start your journey toward a fairer credit report today.