Busting Common Credit Score Myths

It’s no secret that your credit score is an important factor in many financial decisions. Credit scores are used to determine a person’s creditworthiness and can have a significant impact on their ability to get loans, buy houses, or even rent apartments.  But there are still plenty of myths floating around about how credit scores work.

To help you make the best decisions for your financial future, let’s take a look at some of the most common credit score myths and learn the truth behind them.

Myth #1: Checking Your Credit Score Hurts Your Credit

This one isn’t true! Checking your own credit report or score won’t hurt your credit in any way whatsoever as long as it doesn’t involve applying for a loan or opening a new line of credit.

In fact, it’s a good idea to check your report regularly so you can spot any errors or fraudulent activity quickly.

You can get a free copy of your credit report once each year from each of the three major credit bureaus (Equifax, Experian, and TransUnion).

So go ahead and check your credit—it won’t hurt a thing.

Myth #2: Closing Out Unused Credit Cards Will Improve My Score

Another common myth is that closing old accounts will help your credit score. However, this isn’t necessarily true either and it can actually have the opposite effect.

In fact, closing old accounts could potentially hurt your score since doing so reduces the average length of your credit history—which makes up 15% of your total score! Also, closing out those cards could lower the amount of available credit you have, which could make it appear as though you’re using more of that available credit than before—even if you haven’t charged anything extra on those cards lately.

Instead, focus on making timely payments and being aware of how much debt you have relative to your total available balance across all accounts.

And if you really want to close an old account due to inactivity or other reasons, make sure to wait until after you’ve opened any new accounts first so that you don’t end up hurting yourself in the long run.  

Myth #3: Paying Off Debt is Always Better Than Making Payments

This is perhaps one of the most persistent credit score myths out there. While it certainly is beneficial to pay off any debts you owe, it won’t immediately improve your score.

The reason for this lies in the fact that your score is based primarily on your history with debt repayment. So while paying off any outstanding debts will certainly help you build better credit over time, it won’t give your score an instant boost. 

While paying off debt completely is great if you can afford it, simply making minimum payments on time each month will also help boost your score—and it might be easier on your wallet too!

As long as you pay at least the minimum amount due by its due date each month, then making regular payments will help keep up with both creditors and lenders while also improving and maintaining good payment history over time.

Myth #4: Your Credit Score is Always the Same

Finally, it’s important to remember that your credit score is not a static number. It can change over time depending on what kinds of financial decisions you make and how reliable you are at making payments on time.

So if you’re looking to improve your credit score, focus on being consistent in your efforts and build good habits around maintaining healthy financial practices overall—whether that means paying off debts completely or simply making regular payments each month.

And as long as you keep up with these basic steps, then you’ll be well on your way to building a solid credit history and improving your overall credit score!

Credit scores are complicated but they don’t need to be mysterious or intimidating!

With so much misinformation floating around about how credit scores work, it can be difficult to know what is true and what isn’t when it comes to managing yours.

When in doubt, do some research and double-check what you hear against reliable sources like government websites or financial advisors before acting on anything related to your finances or credit scoring system.

By taking the time to learn more about how these systems work and debunking some common myths along the way, you’ll be able to make decisions that are best for both yourself and your financial future!