Happy Thursday everyone! I am excited to say that today’s post is a guest post from Stacy of KissYourMoney.com. Stacy runs a couple of websites that deal with many different financial topics. If you do have any questions or comments directly for Stacy, you can contact her at stacybarbee12@gmail.com.

The views and opinions expressed in this guest post are those of the guest author and do not necessarily reflect the opinions or views of Defeating Normal.


“Your credit report and credit score are two of the most vital aspects of your financial health.”

What do you know about your credit report? Okay. Let me rephrase the question. How much do you know about your credit report? Do you know what is there on your credit report? The experts at the three credit bureaus, namely Experian, Equifax and TransUnion say that there isn’t much information on a credit report. Many consumers don’t even know what is there on their credit report. They believe the story of the magically vanishing delinquency from their credit reports.

It’s a big problem. Misconceptions, myths, and lies about credit reports can make consumers suffer in the long run. It won’t be wrong to say that the information included on credit reports affects a consumer’s credit score. Too many lies and myths can mislead consumers, and their credit score may suffer.

Here are the 5 credit report lies or myths consumers hear most times.

  1. Your annual credit report shows your credit score

Many consumers assume to see their credit score on their free annual credit report. But this is not true. You have to pay $19.95 to get your FICO score. The exception is also there. If a lender doesn’t agree to give you a credit card or a loan, then he has to give you a free copy of your credit score.

You can get a free credit score from creditkarma.com. But it isn’t necessary that lenders would use this particular credit score. There are various models of credit score. The score that gets used depends on the type of loan and the lender you’re working with.

  1. Your credit histories merge after getting married

Your previous credit history won’t merge with your partner’s credit history after getting married. If your partner has incurred debt before marriage, it won’t show on your credit report.

Debts get mingled after marriage in community property states. But credit reports remain separate even in those states. Debts you accumulate after marriage will show on both of your credit reports.

Likewise, if you co-sign on a loan for your friend or your spouse, debts will appear on both of your credit reports. It will be regarded as a joint debt.

What happens to my credit report when you file a divorce?

Joint debts will still show on both of your credit reports. There is no respite. Creditors won’t consider what you and your spouse have agreed to in the divorce. Both of you will be responsible for paying off the debt.

  1. Negative marks will be removed once you pay off debt

This is an absolute lie about credit report. In fact, this is one of the most common credit report myths. Many debtors feel that a negative mark vanishes from their credit report after paying off a delinquent account. But this is not true.

It will take 7 years and 180 days for a missed payment to vanish from your credit report. Don’t think that credit repair companies can help you in this matter. They can help you dispute a wrong negative listing on your credit report. But credit repair companies can’t remove the black mark from your TransUnion or Equifax or Experian credit report. You have to wait for 7 years. There is nothing credit repair companies can do.

A lot of people get confused between the state SOL (statute of limitations) clock and the credit report SOL clock. Both are different. The state SOL clock refers to the time period when your creditor can sue you. This time period typically starts from the day of your first delinquency. The credit report SOL clock is 7 years and 180 days for missed payments, charged-off accounts, Chapter 13 bankruptcy, etc. A charged-off account will stay on your Experian credit report for 7 years even if the state SOL period has expired.

  1. Debt management shows on your credit report lifetime

A debt management plan usually lasts for 3 to 4 years. You send a monthly check to the credit counseling agency and they disburse the amount amongst your creditors. A statement stating that you’re paying off the debt through a credit counseling agency shows up on your credit report and stays there till you pay off the debt. Such a statement doesn’t hurt your credit score.

  1. Checking your credit reports periodically hurts your score

You can get a free Experian credit report once a year from www.annualcreditreport.com. Actually, you can get a credit report from all the 3 credit reporting agencies absolutely free every 12 months. You can also get a free credit report if your loan application has been unapproved.

You can get a free Experian credit report every 30 days on sign in. Checking your credit report periodically can help you spot identity-theft signs before it is too late. It can help you find out the wrong information on your credit report and dispute it.

Many people believe that periodical credit report checking will hurt their score. But this is a lie. You can see your credit report every day. It is regarded as a soft inquiry by the credit reporting agencies, which doesn’t affect your FICO score.

However, if your lenders check your credit report when you apply for a loan, credit agencies will regard it as a hard inquiry. This will affect your credit score. Credit agencies can check your credit score only with your permission to access your credit report.

Fortunately, credit agencies won’t penalize you if you’re shopping for a loan at different lenders. When credit agencies see that you have shopped for a credit card or a mortgage at different lending institutions in the last 30 days, then they will club those inquiries, and consider them as only one inquiry.

Another brutal lie

Some consumers fear that late payments to their doctor will show up on their credit report. But this is not true. The Health Insurance Portability and Accountability Act, better known as HIPPA, prohibits credit reporting agencies from displaying consumers’ medical information – doctor visits, the kind of medical treatment a consumer received or the health care provider’s name.

However, if you don’t pay medical bills, then your healthcare provider can assign the uncollected debt to a collection agency. In that case, the name of the debt collection agency will show up on your credit report. A prospective lender won’t see the name of the doctor or the health care provider.

Your credit report consists of only debt related information. It does not show your race, cast, creed, criminal record, investment or your annual income. Your Experian, TransUnion, and Equifax credit report will show your birth date, address, Social Security Number, etc.

Do you know any other credit report myth? Have I missed out anything? Share your thoughts and opinions.

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