Announcing LendUp’s Money Myths Series! Changes to Your Credit Score This Summer


The first time I stopped to think about my credit score, all I knew was that it’s a 3-digit number I’m supposed to care about. I had recently graduated from college and joined LendUp because the idea of offering a more dignified way for consumers to access and build credit made a lot of sense to me -- even with the little I understood at the time about credit scores. As a member of our Customer Insights team, I spoke with thousands of customers who were eager to improve their financial health and were curious to know things like:

  • “My credit score is X. Will I qualify for one of your loans? Your credit card?”
  • “I was declined. I think it’s because I filed for Bankruptcy 3 years ago when I lost my job. Is that why?”
  • “I have a freeze on my credit report because my wallet was stolen and someone stole my identity and started applying for credit cards. Can I still apply for your credit card?”

Today we’re kicking off Money Myths, LendUp’s new go-to resource, to answer these very questions. Each post, we’ll cover a customer or reader question -- in plain English, no judgement.

To kick things off, I compiled some questions we got recently related to credit scores. It’s a hot topic for our customers, and one of our biggest areas of focus as a company looking to improve the financial health of our customers.

In July, it became an even hotter topic when it was announced that there would be changes to the way credit scores are calculated. There was a flurry of news aiming to explain the impact these changes will have on consumers’ scores, but it seems like there’s still lots of confusion. So without further ado...

1) I saw something about credit score changes earlier this month. What exactly is changing?
The main change is that tax liens and civil judgments will be removed from credit scores, unless the credit bureaus can provide specific information proving they belong to the customer. This is because many have found these specific pieces of data to be incorrect on their files, negatively impacting their ability to improve their scores.

2) I heard my score is likely to go up! Is this true?
Myth. It is widely speculated that scores will increase because of the changes, but nobody can know for certain without checking their own score. You can do this at Credit Karma or on many other websites, or read on for more about the changes!

3) My credit score is so bad, it doesn’t really matter if I start to change things now :(
Myth! Though it seems it’s easier to ding your credit score than to increase it, it is never too late to begin to repair your score. I’ve always been a fan of our educational videos, which are a quick and easy way to get started.

4) So, it sounds like things like tax liens and judgments are getting removed from credit score calculations in some cases. Is that a big deal? They are removed after a certain period of time anyways, right?
Myth. Civil judgments are public records, meaning anyone can access them and, like bankruptcies, they can stay on your credit report for years.

5) Is my bankruptcy still going to be on my credit report?
As of now, there are no changes to how bankruptcies are reported. Bankruptcies typically remain on your credit report for 7 years, but can be on your report for up to 10 years depending on the status of the bankruptcy (you can read more about what information financial companies are required to provide on customers here).

6) When should I check my credit report?
Great question! I usually check my credit report once a year. I tell my friends to use a service like Credit Karma to check for changes -- especially if you’re going to apply for a credit card, try to get a car loan, or apply for a new job or apartment. I moved recently and checked my full report before submitting my rental application. Thankfully there were no errors, and seeing the full report helped give me peace of mind that I’m in good shape... for now!

Have a question for Marissa? Fire away! Email or ask us on our Facebook page.

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