Credit Facts & Education

Know Your Credit

Empower yourself with knowledge. Understanding how credit works is the first step to improving it.

• What Is a Credit Score? +

  A credit score is a three-digit number that lenders use to evaluate your creditworthiness. Scores typically range from 300 to 850, with higher scores indicating lower risk. The most commonly used scoring models are FICO and VantageScore.

  Your score is calculated based on information in your credit report, including payment history, amounts owed, length of credit history, credit mix, and new credit inquiries.

• What Affects Your Credit Score? +

  Five main factors influence your credit score:

  • Payment history (35%): Whether you pay bills on time.
  • Credit utilization (30%): How much of your available credit you use.
  • Length of credit history (15%): How long your accounts have been open.
  • Credit mix (10%): The variety of credit accounts you hold.
  • New credit (10%): Recent applications for new credit.

• Common Credit Report Errors +

  Studies show that one in five consumers has a material error on at least one of their credit reports. Common errors include:

  • Accounts that do not belong to you (identity theft or mixed files).
  • Incorrect payment statuses (e.g., reported late when paid on time).
  • Duplicate accounts or outdated negative items past the reporting limit.
  • Incorrect personal information leading to mixed credit histories.

• Your Rights Under the FCRA +

  The Fair Credit Reporting Act (FCRA) is a federal law that protects consumers by promoting accuracy, fairness, and privacy of information in credit reports. Key rights include:

  • The right to a free credit report every 12 months from each bureau.
  • The right to dispute inaccurate or incomplete information.
  • The right to have errors investigated and corrected within 30 days.
  • The right to sue for damages if your rights are violated.

• How Long Do Negative Items Stay on Your Report? +

  Most negative items can remain on your credit report for up to seven years from the date of first delinquency. However, some items have different timelines:

  • Late payments: 7 years from the missed payment date.
  • Collections: 7 years from the original delinquency date.
  • Chapter 7 bankruptcy: 10 years from the filing date.
  • Chapter 13 bankruptcy: 7 years from the filing date.
  • Hard inquiries: 2 years from the inquiry date.

• What Is the Credit Repair Organizations Act (CROA)? +

  The Credit Repair Organizations Act (CROA) is a federal law that regulates credit repair companies and protects consumers. Key provisions include:

  • Credit repair companies cannot collect fees before services are fully performed.
  • You have a three-business-day right to cancel any contract without penalty.
  • Companies must provide a written contract detailing all services and fees.
  • No company can legally remove accurate, timely negative information from your report.

  Connect Credit operates in full compliance with CROA. You can review our CROA Disclosure at any time.