5 Credit Report Myths (and What’s Actually True)

Credit can feel like a mystery, especially when you’re trying to understand how lenders, landlords, or employers might see your financial history. If you’ve heard conflicting advice from friends, family, or the internet, you’re not alone.  Credit reports can feel confusing or even intimidating. 

Here are five common myths— and what’s really going on behind the scenes. 

Myth 1: “My credit history only starts when I take out a loan.” 

Reality: Your credit history can start earlier than you think. 

Your credit history begins the moment you use any type of credit or enter a payment agreement. That includes things like a credit card, a phone plan with monthly payments, or a student loan. It can also include unpaid debts that get sent to collections. If a business sends your overdue account to a collection agency, that agency may report it to the credit bureaus. 

Public records, such as bankruptcies or certain tax-related debts, can also be noted on your report. 

In short: you may be building a credit history long before you ever apply for a loan. 

Myth 2: “Only lenders can look at my credit report.” 

Reality: Several organizations may request access — but only with your permission. 

In New Brunswick, lenders, landlords, and sometimes employers can ask to see your credit report. They must have your consent before they can access it. 

For example: 

• A landlord may want to see if you’ve had trouble making past payments. 

• An employer may check your report as part of a hiring process. 

You get to decide when and to whom you give permission.  

Myth 3: “The only way to improve my credit is to pay an agency.” 

Reality: You can dispute errors on your credit report and rebuild your credit yourself — for free. 

Credit reporting agencies collect, maintain and provide information about your credit history in your credit report. You can contact the credit reporting agency at any time and dispute missing or incorrect information in your file for free. You don’t need to pay anyone to do it for you. If your file contains inaccurate or incomplete information, the credit reporting agency must correct it within a reasonable period of time. 

Credit repair agencies offer services or goods that are intended to improve your credit report or credit rating, for a fee. Under New Brunswick’s Credit Reporting Services Act, credit repairers cannot charge you before they make a material improvement to your credit file. You have the right to cancel a credit repair agreement within 10 days of receiving a copy of it — for any reason and at no cost. You may give a notice of cancellation to a credit repairer by: 

• delivering it personally to the credit repairer, or 

• sending it to the credit repairer by registered mail, prepaid courier, fax or any other method that permits the consumer to provide evidence of the cancellation. 

If you choose to cancel, the company must refund your money within 15 days. 

Myth 4: “Checking my own credit report will lower my credit score.” 

Reality: Checking your own report does not affect your score. 

There are two types of credit checks: 

Hard inquiries happen when you apply for credit (like a mortgage, credit card, or auto loan). These can affect your credit score, especially if there are several in a short time. 

Soft inquiries happen when you check your own report or when a company checks it for non‑lending reasons, such as a utility account or job application. Soft inquiries appear on your report but do not impact your score. 

It’s a good idea to review your report at least once a year — or more often if you notice suspicious activity or worry about identity theft. If something looks off, you have the right to dispute it.  

Myth 5: “Co-signing a loan won’t affect my credit.” 

Reality: Co-signing makes you responsible for the loan too. 

Co-signing means you’re agreeing to take on the debt if the primary borrower doesn’t pay. If payments are missed or the loan goes into default, that information can appear on your credit report as well as theirs. 

The loan also counts toward your overall debt load, which may affect your ability to borrow in the future. 

Co-signing can be helpful, but it’s important to understand the risks before saying yes.  

Bottom line 

Your credit report tells the story of how you’ve handled credit over time. Understanding how it works can help you feel more confident when borrowing, renting, or applying for certain jobs. 

If you want to learn more about how credit reporting works in New Brunswick, visit Credit, Debt, and Loans.