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Eight Things You Don’t Know About Your Credit Score

Written by Equifax Experts on January 9, 2014 in Credit  |   69 comments

As you work to improve your credit score and creditworthiness, it’s important you understand how the information in your credit report can impact your financial future. Unfortunately, there are a few misconceptions about credit scores that may keep you in the dark.

information on my credit reportIf you’ve decided that 2014 is the year you’ll finally improve your credit score, you’re not alone. According to the U.S. government, paying off debt is one of the top New Year’s resolutions people make.

Before you begin getting out of debt and improving your creditworthiness, however, it’s important to first understand how your credit score works—and how the information on your credit report can impact your financial future.

As you kick off 2014 with creditworthy behavior, consider these eight things you may not know about your credit score:

1. The credit reporting agencies don’t determine your risk as a borrower, they only report your credit history and determine your score.

The three national credit reporting agencies—Equifax, Experian, and TransUnion—do not determine whether you qualify for credit or what terms and interest rates you are offered.

Instead, the agencies collect and maintain a history of your credit activity, which is reported to them by lenders and creditors that have granted you credit in the past or with whom you still have open accounts. Each of your creditors, including credit card companies retailers, lenders, blanks, and collection agencies, reports the status of your accounts and your payment history. Information is also collected from public records.

A history of on-time payments will reflect positively on your credit score, while a history of late or missed payments could negatively impact your score.

2. There are different types of credit scores.

You don’t have one credit score—you have several. There are various credit scoring models that lenders use to predict your credit risk, and each lender picks the model that best fits its needs. Some lenders use scores that are weighted according to their industry, while others use blended scores from all three credit reporting agencies.

As a result, your auto lender might calculate a credit score that is different from the credit score calculated by your mortgage lender. But if you have a good credit score with one scoring model, it’s likely (but not guaranteed) that you’ll have a good score when other models are applied.

3. If your credit scores are different among the credit reporting agencies, it might not be a mistake.

If you order your credit score from each of the three national credit reporting agencies, you could find some variance between the three scores.

For example, if you order your credit score from one agency in January and then pull your score from another agency in April, your scores could be different because of changes made to your accounts or new accounts that have been opened in those months.

In addition, not all creditors report their data to all three credit reporting agencies—some only report to one agency, while others report to all three. As a result, your credit report from each agency might have slightly different data.

Finally, each credit reporting agency uses different scoring models. Even if each agency has information from the same creditors, the model the agency uses could still generate different scores.

But if inaccuracies in your credit report are causing discrepancies between your credit scores, you may want to file a dispute with the agency reporting the erroneous information. Inaccurate information in your credit report could also be a red flag for identity theft.

4. Your age and marital status, along with other pieces of personal information, are not used to calculate your credit score.

Your credit score is calculated based on the information in your credit report, such as your payment history, your debt-to-credit ratio, and the length of your credit history.

There are certain pieces of personal information that are not factored into your credit score and cannot be considered by lenders when evaluating your application. This information includes your age, marital status, race, religion, and gender. Generally, your salary, occupation, employer, and employment history are also not considered.

5. Closed accounts can still affect your credit score.

Just because you close an account doesn’t mean that information is erased from your credit report.

If you close a credit account that was paid as agreed, it will generally stay on your credit report for up to 10 years from the date of last activity. If you close an account that was not paid as agreed and charged off, on the other hand, it will typically stay on your credit report for seven years plus 180 days from the start of the delinquency that led to the charge off.

6. The Fair Credit Reporting Act (FCRA) limits who can see your credit report.

Not just anyone can access your credit report.

Businesses must have a “permissible purpose,” as defined by the FCRA, in order to access your credit report. Otherwise, third parties must have your written permission in order to obtain it.

According to the FCRA, those who can access your credit report include:

  • Credit grantors with whom you have applied for credit
  • Collection agencies—when they need it to collect a debt
  • Insurance companies, which may use it for underwriting
  • Employers—but only with your written permission

If a company pulls a copy of your credit report, it will be listed under the inquiries section of your report.

7. Your credit report is free through annualcreditreport.com, but you need to pay for your credit score.

You are entitled to one free credit report from each of the three national credit reporting agencies every 12 months through annualcreditreport.com. You could order all three reports at the same time in order to compare them, or you could scatter your order requests to monitor your credit report every few months.

In order to access your credit score, you’ll need to pay a nominal fee. Prices can vary slightly depending on the agency from which you pull your score.

8. Checking your own credit report will not hurt your credit score.

When you order a copy of your credit report, you trigger what’s known as a soft inquiry. Soft inquiries are also made when a credit card company offers you a preapproved credit card for which you did not apply. In both of these cases, the inquiry does not impact your credit score.

Hard inquiries, on the other hand, do impact your credit score. A hard inquiry is triggered when a creditor with whom you have applied for credit pulls a copy of your credit report.

In general, inquiries will stay on your credit report for two years, with only the hard inquiries factoring into your credit score.

69 comments

  1. Syed A. Naqvi says:

    Very useful information to understand credit reports and score calculation. Appreciated!
    Syed Naqvi

  2. Donna says:

    All my closed accounts are paid as agreed. I have several opened ones in good standing. NO late payments, but still you provide me with a fair score. I am not agreeing that you dont determine our score(the consumer) because you do. My score is hurting because you are NOT rating me good at all. I feel you work to keep our score in good standing but in my opinion you keep our scores low to help the creditors to give us higher interest rates. That’s who you are working for, the money hungry creditors.

    • Denise says:

      Donna,I agree. It seems like there is little we can do to keep our score high. I am fed up with this credit scoring system!!

    • Cheryl says:

      Why do you have this opinion?

    • Sheryl C says:

      Totally agree. Also process is overwhelmingly unfair to consumer when disputing something . Only the “Creditor ” is contacted , and of course the creditor will say you owe them money. Consumers side is never requested. Totally biased and completely one sided. Goes to show all credit reporting agencies work with the creditors and not with consumers. In a court of law both sides are given opportunity to testify. Not here. This is another area government needs to step in. I’ve also noticed there is no regulations of any kind on ensuring a creditor shows proof of contact with consumer prior to negatively reporting to credit reporting agencies. Things “appear” on credit reports with absolutely no contact from creditor to give consumer a chance to pay what’s owed. There should be a certified mail requirement for creditors before they initiate contact with credit agencies and report negatively. Again legislation needs to be enacted here. It’s a total free for all for the 3 credit agencies, and creditors as well.

    • Anonymous says:

      They do determine the score. They dont determine the risk factor of your loan. That is determined by the lending institution. Credit scoring sucks.

    • catriona rinn says:

      This is very well said,I feel alot of these agencies are just a rip off,I will be buying property this year and my Landlord will give me an outstanding reference which in turn I will take to credit union and banks.I have never had a late payment yet my credit score is good not good enough in my book.

  3. Monte McBroom says:

    Why does a “hard inquiry” impact the credit score?

  4. John says:

    Why should hard inquiries affect your credit score? I want to buy a house and a lender checks my credit as it should and then I get dinged for it. Why should that be a negative on my credit how else are they supposed to find out if I am worthy of credit? Obviously if I authorize someone to check my credit it is for my benefit , I have done nothing wrong my payments are still made on time so why should this affect me?

    • james says:

      Because people have set up scams over and over again thru the years. They go on stretches where they’ll open several accounts at one time with no intentions of ever paying the bills.

      Another situation where people abusing the system mess it up for all of us.

  5. Jack says:

    How do I get hard inquires off my credit if I didn’t give permission to pull it

    • EFX Moderator, KB says:

      Jack, that’s a good question.

      Hard inquiries are requested on your behalf from potential creditors that are looking into your credit history in order to give you a loan or line of credit. These are inquiries you initiated when shopping for a car loan or mortgage or when applying for a new credit card—you should recognize each one. If you don’t, that’s a red flag which may signal that someone is using your identity to borrow money against your name. If you spot this as a red flag, you should contact the police to file a report, and also consider calling the FTC’s identity theft hotline at 877-438-4338 to file a complaint.

      Here is more information on hard inquiries for which you didn’t apply: http://blog.equifax.com/credit/monitor-your-credit-report-for-identity-theft-red-flags/

  6. joe cat says:

    credit reporting as we know it,it is a snap shot which doesn’t tell the complete story.Example:you have 2 cr. cards,1 has a cr.ln. of 25k and 2nd. 30k .For the last 7yrs.you ran up balances ea. mo.above 50% of cr.ln.BUT you have paid balances in full ea. mo. This will report negative!Because creditors like to see under 18%. In reality it should report positively.Because credit report should show a few years of monthly balances with matching payments therefor demonstrating your great track record and ability to do even better than 18%, ” IT IS ZERO % ” Also,we should not be penalized when we close a 10 year old card with21% rate,and open 1 with 9% rate! This shows good sound fiscal policy.This is a positive thing! Instead they deduct from your score.Because you lowered average age of cr. history and opened new card.And finally could someone explain to me why they lower your score when you paid off house mortgage.It is sad that we are judged on how much debt we get into and out,instead of not having any.

    • bankrupt Dan says:

      Very simple. It’s all about the money they can make. For example: if they show you with a high credit score and you submit ONE application, your approved. HOWEVER, if your disapproved because of the lower credit score, then your application gets SHOT GUNNED to several different banks causing the banks to pay for your credit pull several times to the one credit agency and WHALLA!! INSTANT MONEY MADE!

    • NWA says:

      Agree with you 100%

  7. M. S. says:

    What if a charged off account is sold to a collector? Can the collector re-date the account when they purchase it from the original creditor or does it still remain in your report for 7 years plus 180 days from the original creditor’s delinquency?

  8. Charles Humphries says:

    I have heard over the years that cancelling a credit card that you are not using or haven’t used in a while can adversely affect your credit. Is this true or not?

    • Michelle says:

      Yes, cancelling a credit card you haven’t used in awhile means that you’re taking away the available credit that you hold in that account, making you appear less trustworthy with a credit limit because your available credit total from ALL your credit cards will decrease upon closing that account. It’s better to just keep it open and not use it, but still monitoring that it doesn’t get fraudulently used meanwhile. Hope that helps.

  9. renee says:

    Are collection agencies allowed access to anyone’s credit file? I do not owe creditors yet my account is getting accessed by unknown collection agencies. I want this to stop.

  10. James C. Bell says:

    It seems to me, that purchasing a credit score is a waste of money. By your on admission it would not be the only score within the agency! If you did order a three agency report it would be even more useless ! You might have three agencies with three or four scores within each equaling as many as
    twelve different possible scores.

    Time for one uniform score based on history and ability to pay!

  11. Merlin says:

    With Discover giving there card holders the FICO score on the statement, how long before those scores are on all CC Card statements and the stupidity of having to pay for it ends?

  12. Avo says:

    Misleading title—- Apparently designed to get attention. Most of those things I already knew and the few I didn’t were insignificant.

  13. Jim McMillan says:

    Equifax always has a lower score than the other reporting agencies with basically the same information reported. the main difference is in the number of credit checks reported. this number is always very high with Equifax and a representative could not tell me which checks were actually counting in my score. I had an auto dealer check my credit in October 2012 and a request was sent to 5 0r 6 lenders to get the best terms such as interest rate and length of payment. Consequently Equifax reports 15 credit checks on my report. It is my understanding that when shopping for rate and credit is granted there is supposed to be only one check factored in the score. with my Equifax score being 70 to 80 points lower than the other reporting agencies I have to believe that the total checks are affecting my score. I spoke with a representative and they told me they all counted. when I challenged him he put me on hold and came back and told me I was correct in that only one check was factored in the score. i asked him to tell me which checks were counting in my score and how much they were affecting my score and he told me he could not tell me and there was no way to tell me as the computer calculated based on the information put in and no one knew but the computer. Really??? I have had credit for nearly 40 years and three late payments in that time and I have a 626 score. I own three businesses and gross over 600k per year and pay my bills on time and only owe about 300k on property worth about 850K and I have a 626 score with Equifax but 700 with the other agencies. Really???

  14. Charles says:

    What if you apply for a car loan at the car dealership and they have your credit ran through 5 different lenders to get you the best interest rate. Will all these inquiries count as 5 or as 1 inquiry being that they were all ran on the same day. I have 7 inquiries showing up on my report for 1 year which one was from a credit card, 1 from the purchase of a new house and the last 5 from a new auto loan so I really only have 3 in technicality. What options do I have? How bad are all of these inquiries hurting my score and making me look to potential credit card offers

    • Anonymous says:

      Normally when purchasing a home or a car all the inquires will be grouped as 1 hard pull even though it may be 5 or more people looking at your credit.

    • Momof2inSanJose says:

      Typically you can have three auto inquiries within 45 days and have those three count as one hit. 5 inquirys then would be 2 hits. A hit usually costs you about 2 pts. this is probably the biggest mistake people make when securing car financing. they don’t know what happens “behind closed doors”

  15. V.k says:

    This was quite helpful and useful. Thanks

  16. Gerald R Leopold says:

    Thanks for the great information about credit scores. Really useful and very detailed. It is much appreciated.

  17. R. D. Henze says:

    For any of this to have merit, the system must not be broken. Simplified: if you subscribe, you must be able to access your information without receiving persistent (going on 4 months now) ‘technical errors’ about which Equifax appear to be incapable of explaining or fixing. How can an entity that cannot provide those who subscribe to their services reliably be entrusted with the role of rating anyone’s credit worthiness?

  18. alvin emerson says:

    Does the derogatory entries ‘have to stay’ on your credit report for seven years, or is that solely up to the credit reporting agencies? My understanding is that the FCRA mandates that a derogatory must be removed after seven (7) years but the removable of them before the seven year limit is negotiable with credit reporting agencies. Is this a correct understanding?

    • EFX Moderator, KB says:

      Alvin Emerson, good question.

      In general, negative information will stay on your credit report for seven years from the date of last activity. Late paid accounts that are still active will be removed from your credit report seven years from the start of the delinquency, which is when the payment was missed.If you have an account that has been charged off or is in collections,it will typically remain on your credit report for seven years and 180 days from the start of the delinquency that led to the charge off or collection.

      Here is a link with more information: http://blog.equifax.com/credit/how-long-does-information-stay-on-my-credit-report/

    • Momof2inSanJose says:

      I would like to just add that while that is what the FTC mandates for them, you can ALWAYS ask the collection agency if they will remove it. They have the ability to do so. Whether or not they will is another story as they are not required too. Always try and include that as part of any negotiation up front.

  19. khalid durrani says:

    Just basic information nothing new.

  20. Emil says:

    Why does a hard inquiry impact a credit score?

    • Johnnye says:

      Think of it as a convenience charge like atms have.
      Say if you bank at Wells Fargo, you can use the atm there as much as you want for free and not have to pay for it but if you went to an atm in a store or another non wells fargo atm it would charge a fee… Well, when you apply for credit not only are you trying to take on more credit but you’re also using another company to access your credit report.. So in this analogy… Equifax is wells fargo and credit companies are non wells fargo atms.. If you get your credit report/score from Equifax.. No convenience fee.. but applying for credit at the third party… convenience fee/few points lost. It’s the same concept although not exactly the same process.

  21. hattie yancey says:

    Very helpful information.

  22. Danny Pryor says:

    What I want to know is why collection agencies have any right to check a person’s credit report. Who greased the palm of whom to get that clause approved as part of the FCRA?

    • NWA says:

      Good Point, because you not only get ding from the creditor, but then you also get ding from the collection agency, all for the one debt. Even if the debt is later (6-9 months) discovered it was a mistake.

  23. Tom Clements says:

    Let’s face it, they do want they want. I had an erroneous listing due to a family member with the same. Not sure how it could happen since it is “supposedly” your SS number that is used. It took me 4 months to resolve it. It seems the people I would get on the phone had NO ability to change anything. One even told me that straight up. I can appreciate that we need credit checking agencies but they have gotten too big and impersonal. They really want you to buy their services. As some have noted here if you try to be fiscally responsible it can have a negative effect on your score. Closing out credit cards should NOT be a negative. Because I had a person at Equifax tell me I had “TOO MUCH” available credit. And the tips are only useful to a complete NOVICE. There is NO common sense involoved

  24. M.S. says:

    Why do we even bother to leave a comment or a question here, since NOBODY from Equifax BOTHERS TO ANSWER any of them???

    • W.H. says:

      Excellent point!..You would think a Equifax who created the comments forum would provide answers to questions asked.
      Credit scoring and reporting impacts families lives to such a degree it determines the ability to obtain housing, transportation for work and school, insurance rates etc, it should be simplified and standardized.
      This system is so confusing and weighted against the consumer.

  25. Joe cat says:

    M.S the reason I do so any probably some others is to exchange useful information.With this you can make adjustment on how you act out and manage your credit. Some of us learned the hard way,and would like to see others avoid same mistakes resulting in a lower score.We must all unite in conversation and action for the overall good,that is us the consumer,to result in highest score possible.

    Tom C. your right there is no common sense.They can start here reading good sound valid points you,others and I have made and make small changes.We need to do everything we could to minimumize banks benefiting by offering higher rates.This is were Government should step in and force some changes!

  26. ckive says:

    Credit agencies are nothing more than con men none of them are accurate

    • Fed up in Illinois says:

      I agree with just about everyone.. More government scams to get our hard earned money. They should be abolished and charging for your score- it’s mine-why should I have to pay for it??? We the people should be in charge and not the bureaucracy.

  27. DA says:

    “The credit reporting agencies don’t determine your risk as a borrower, they only report your credit history and determine your score.” Translation: “Guns don’t kill people, people kill people…

  28. John says:

    “According to the U.S. government, paying off debt is one of the top New Year’s resolutions people make.” If you want to pay off debt, why are you worried about being able to go back into debt? Don’t worship at the alter of the FICO score. http://www.daveramsey.com

  29. RN says:

    It is a broken system. I went through a divorce, my ex was able to open new accounts after I moved , in both of our names! (Small town of people who did not know I filled for divorce) I disputed these, with the companies and the reporting agencies, and even though they were not mine they were all on my report for years! A lawyer told me later I would have Ben better off if I had filed bankruptcy! The system is so flawed! My report doesn’t reflect my true ability to pay. I paid off my car and it dropped further! Makes absolutely no sense!

  30. K.K.M. says:

    So I am working on rebuilding my credit history after falling on hard times in the past. My credit score at Equifax is currently at 592. I am now starting to receive Credit Card offers from Capitol One and Discover (with no annual fees), quite frequently. I currently have one credit card with a small $1500 limit and my debit card. I have a car loan and have built credit with an online Catalog company……If I take these pre-approved credit offers and add to my available credit , would I then be displaying a greater debt/ credit ratio , which in turn would improve my credit rating/ score? Am I understanding this right? Responses appreciated…I need to move on this! I’m trying to save for a condo..I have a decent job , am single and earn in the high 50’s.

    • EFX Moderator, KB says:

      K.K.M. that’s a good question. It’s important to keep your ratio of debt to available credit low.

      As you look over your credit reports, consider your debt-to-income ratio. So ideally if you add up all of your debt—including payments on your student loans, auto loans, credit cards, etc – it should not exceed 36 percent of your gross monthly income.

      Here is a link with more information: http://blog.equifax.com/credit/tips-for-paying-off-debt-in-2014/

  31. Bill Corder says:

    We should be able to get our personal credit scores anytime, for FREE! The credit reporting agencies are getting paid by those companies who request the report.
    Ever try to change an incorrect entry on your report? Don’t waste your time. You have NO say as to what is on the report.

    • Momof2inSanJose says:

      Bill as someone who has done this for 8 years in the mortgage industry I would have to beg a difference of opinion. That said, it is not always an easy task. Most of the time, the disputes I have dealt with involve collections or profit and loss’s that have been paid off but are not reporting accurately. It is impearative that when you enter into any kind of pay off agreement with a creditor and you complete that task, that you ask for a letter in writing confirming the same indicating the account number and your naame for your files and then continue to monitor your credit report to ensure that it does take place. Again, it costs them money to do it and so they are reluctant to provide that service. Especially the mom and pop operations. However; to not provide this is in direct conflict with the federatl trade commission guidelines and typically a strong verbal statement of the same to the collection agency followed by a promise to report them will warrant you the letter that you desire. Going forward then, if that same company does not report it as paid or otherwise erroneously, you can provide a copy of that proof to the credit bureau as part of your dispute. Credit reports are like your medical charts – you must be your own advocate and monitor it consistently at all times. It would be nice to be able to get our scores at any time for free but the credit bureaus are independently owned private businesses and therefore in the land of free commerce, can charge for any product or service they provide. That said, you can get the one a year free truly FICO score report at the http://www.annualcreditreport.com website. Hope that helps.

  32. S.V. says:

    I have a lot of payday loans I have consolidated with debt management and Payday Support financial . Before the payday nightmare I was improving my credit score. Now my score is 656. Will these Payday Loans affect my credit score if reported to the credit bureau if I am consolidating and they are getting paid. Very concern please help.

  33. Terrance says:

    I used Experian’s credit monitoring service for over 3 years. While a member they reported my credit score as 738. After I dropped their service and applied for a Discover card, they reported my credit score as 575 and I Was denied the card. I have always paid my bills on time and did not have any adverse actions in my report; so why the difference in credit scores.

    • Momof2inSanJose says:

      Terrance, there are a ton of scoring models out there for predicting credit scores. Even each credit bureau (as well as credit card companies and banks) will use a different scoring model for the different services they offer (and which you pay for). see my comment below for the http://www.annualcreditreport.com. That report will reflect a true FICO score as will any mortgage pull that is done. Mortgage lenders are required to pull a FICO (based ont he Isaac model). That said, you do not indicate the time frame between when you dropped the service and applied for the discover card. It could be that during that window of time, a derrogatory appeared (unpaid collection?) that took it soaring down. Being in the mortgage business myself, I am pulling FICO scores and have countless people ask me all the time, “Why is my score so much higher when I use my service”. It’s frustraing. Hope that helps…

  34. Anonymous says:

    All a messed up game really, just for lenders to make more money in interest. I closed my accounts and have paid them all off, unlike half of America, and I have poor credit. After being a homeowner for the last 15 years, I have worse credit that when I was a teenager. It is a game you can not win. I could have filed bankruptcy and been buying a new car right now. Instead, paying them off and having no revolving debt, I can’t even get a car loan. Really backwards..

  35. James E Hathaway says:

    I bought a home in early 2012 and the loan is being carried by the owner. All payments are by auto pay so all are on time. I even had the amortization schedule re figured and increased my payment by $200.00 per month and it all goes to principal.

    Problem: How do I get credit for my loan and prompt payments when it is being carried by a personal lender, i.e. the home seller?

    • momof2insanjose says:

      James thought I don’t work for Experian I have been doing credit report repair for 8 years serving over 2500 clients for the purpose of purchasing homes. It sounds like you have entered into a contract for deed with this private individual. Sometimes known as “Owner carries financing” the answer to your question is, it will not report on your credit report at all unless that individual has a business license in which they can submit information to the credit bureaus. Please note that it costs them money to report on you which is why a number of companies don’t do it. That said, while it will not contribute to your score, you can submit a non-traditional letter of credit at the time of applying for financing by this individual which will also go a long ways towards your approval. They typically like to see a min. of 12 mos history and the letter should state that there have been no late pays during that 12 mos and that you have paid on time and in accordance with your agreeement.

  36. Deanna says:

    Some places allow you to provide your own current credit report when applying for a loan, apartment etc… This can avoid too many hard inquiries on your report.

    • Momof2inSanJose says:

      Deanna – this is true and did you know, that the free credit report offered to everyone once a year through http://www.annualcreditreport.com is the only true FICO score issued? every other score offered to you by the credit bureaus as part of a service is an “educational score” and does not give you all the information you may want or need. That said, order your report through them and use that when you need to. Banks however; are required to run their own and not make decisions based on someone else’s report due to liability reasons. Hope that helps…

  37. Anonymous says:

    Improving your credit score is almost next to impossible. They tell you to
    pay-off your debts, however, if you’ve had collections or charge-offs; it does not help. They still report them as charge-offs or collections. This happened to me after being unemployed for 2-yrs.
    After I got a job, I paid off the collections and charge-offs; it was a nightmare trying to find out who the accounts were sold to. Once finding the correct agency to pay, the original creditor still report that you owe them. And of course, with all collections paid; I still cannot get even a
    secured card. They still report as a collection or charge-off with a zero balance. A no-win situation.

    • Momof2inSanJose says:

      Dear Anonymous: It’s hard to get a clear picture of what your repot looks like without looking at it directly but if all it contained was past collections or charge offs that you have paid off and now reflect a 0 balance, you should be able to get a secured credit card anyway. Keep trying your local banks and credit unions. CAP One has one on line. That’s the whole point of a secured credit card, the banks aren’t at risk as they are using your money. Two important things to ask if you get one: 1. how many bureaus do they report to (you want all 3) and 2) how long do you have to have it before it begins to report. Beyond that, if you are still having issues – here is another idea. Ask a parent, sibling, family member to put you on one of their lines of credit as an authorized user so you can take advantage of their history. Ideally the account should be 12 mos history, large limit and small balance with clean history. Now…..will you still get a score if you have one loc and 10 collections marked as paid with a report date that is in the last 12 mos? probably not, but eventually, time will pass on those report dates and when they hit a year of being paid, then your new history will kick in. It’s important to keep in mind that a collection or otherwise negative charge off once paid off will still have a negative impact on your scoring for 12 mos. The impact becomes less and less as each month passes but still factors in. You can also ask the collection agencies if they would be willing to remove the line item as part of their settlement. They are not required to do so, but they do have the power to do so. They may choose not too because again, this is extending a service they aren’t required to do AND costs them money to do but that said……..if you negotiate the removal of it as part of any settlement up front, they typically will consider it. I have great luck with this when counselling my clients. Don’t get discouraged – unfortunately, the credit scoring process is not an accurate one but the economy of this country is based on it so you need to play the game to a certain extent. Also, on any account that was first reported as a collection that has now been sold off to someone else, you need to file a dispute on that. If you call the old company and they say it was sold off, get something inwriting to state the same and provide that as proof. Persevere!

  38. Holly says:

    Credit Unions are where you need to go for savings and lending programs. Check with your local credit union. They may also provide educational information on all the items listed above. I too noticed no one from Equifax was commenting. Sad to say the least. Go to your credit union today and begin a relationship so you may achieve financial success in the future. Word of advice; be sure you read all the fine print on all credit applications and contracts before you sign them.

  39. SPack says:

    I had an account suddenly appear on my credit report last year that had been charged off. This account had never shown up on any of my pervious reports but it was 7 years old. In the payment history all payments were made on time as agreed until Jan ’13 with nothing on any of my bank or credit card statements. I challenged this negitave report with Equifax and they said the account was mine. So I called the company and talked with them. They reviewed their records, the account appeared fraudlent to them and they contacted the Credit Reporting Agency and had it removed. Don’t accept a fradulent denial from the credit reporting agency if you think they are wrong.

  40. Flabbergasted says:

    It is the most ridiculous thing that I have ever seen. How can you have an 804 score with Equifax when you pull it yourself through Annualcreditreport.com, and then the bank says its a 698 when applying for a mortgage? THAT is a game – I have paid off ALL debt including my mortgage, still have an on time mortgage with an investment property w/debt ratio EXTREMELY low. That is simply a way for them to make more money in interest. The negative was that I didn’t have enough revolving accounts. Absolutely the stupidest thing I have ever heard. I make $75,000 a year, have a mortgage payment on rental property of $450, and I have to pay a higher rate? My track record is immaculate. Banks truly do not make financial sense – it is a way for them to make more in interest. Not getting my loan. Sorry! I will stay basically debt free and stay where I am.

  41. Alyson says:

    I sent a letter to all three credit bureaus on the same date requesting they remove 7 erroneous collection accounts. Transunion and Experian removed them, however; Equifax removed 6 and stated that 1 did in fact belong to me, a collection account from 2010 for a small amount of money, I have never received anything from this creditor. How can two agencies have correct information and then Equifax gives different information, what should I do in that case? And the credit scoring is ridiculous, darned if you do, darned if you don’t…I never carry high balances on my credit cards, in the last ten years, have had a total of 3 cars never late and paid off..my credit score goes up and down between 610-630…why? I would think it would be at at least 700 or higher!

  42. Barbara says:

    What interests me is that I went through Equifax for their “3 for” program (i.e., pay them $17.95 per month to obtain the scores from each credit bureau). I cancelled out and went through my bank for a program put on by Experian at a more decent price.

    My Experian credit score (through Equifax) was 825. My Experian credit score (through EXPERIAN — two days later) was 783.

    Are our credit scores being “doctored” depending upon whom we subscribe to?


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