There is more credit information available than ever before nowadays. We all know how important it is to know your credit score and the different factors that influence it. The trouble is that there is a lot of misinformation on the Internet. The last thing you want to do is end up believing a myth, which causes you to act in a manner that has a detrimental impact on your credit rating, rather than a positive one. I am by no means a credit expert but I have learned a few things along the way! So, with that in mind, let’s take a look at some of the credit score myths that you need to ignore with this collaborative post. Espechially if you have been working hard trying to improve your financial struggles!

Credit Score Myths You Need To Ignore

• You only need to check your credit score if you are about to apply for your loan – If you do this, it could be too late. Checking your score regularly so that you can maintain it properly is a necessity.
• You will have a good credit score if you do not have any debts – Actually, if you have never had a credit card before, it is likely that you will only have a fair credit score. This is because there is no lending history available for your credit rating to be based on. You can find out more online about the best starter credit cards, as it is unlikely you will be offered the best deals right away. By taking out a card and paying it off in full every month, you can improve your rating.
• Applying for a new credit card will hurt your credit score – This will only happen if you apply for several cards. A lot of people make the mistake of applying for many cards at once. Then they plan to pick the best offer they are accepted for. This sort of approach can negatively impact your rating. Instead, do a soft search online to find out about your eligibility. From there, apply for one card and one card only, knowing that you are likely to be accepted because of the research you have done.
• It takes six years to improve a bad credit score – A lot of people believe that they are doomed for seven years if they have a bad credit score. This is not the case. It all depends on why your credit score is bad. If it’s bad because you are using a lot of your available credit, once you start paying off your credit cards, your score will improve. However, if it is bad because you have defaulted on lots of payments or filed for bankruptcy, this will show on your account for six years. Nevertheless, the impact of this will get less and less as the years go on.
• Closing a credit card will improve your rating – This is one of the most commonly believed myths regarding your credit rating. While it makes sense to close your credit account once you have paid it off in full, this is not a good idea for your credit rating. Let’s say you currently have four credit cards, all of which offer you $2,500 in credit. At the moment, you are using the full $10,000 available to you, and therefore, you are using 100 percent of your available credit. If you pay one card off, you are using $7,500 of $10,000. The fact you are now using 75percentt of your credit will improve your score slightly. If you had closed this card instead, you are using $7,500 of $7,500, which means you are back to using the full 100 percent of your credit which has a negative impact on your score.
• Your income has an impact on your credit score – The amount of money that you earn per month does not have an impact on your credit rating. A lot of people assume that they will have a bad credit score if they do not earn a lot of money. This could not be further from the truth. You could have a better credit rating than someone who earns five times the salary you do. This is because the money you make has no impact whatsoever – it is all about your lending history.
• Employers check credit scores – A lot of people worry before applying for a job because they fear that their employer will check their credit score. This is actually against the law. Your employer is not allowed to use credit scores or checks as part of the process for screening job applicants. An employer can check your credit report, but they cannot check your credit score – these are two different things!
• You have one credit score – Actually, you have a number of different credit scores provided by different agencies. Banks, lenders and such all have their preferred credit check agencies, so it is worth keeping this in mind.

Hopefully, you now have a better idea regarding some of the most common credit report myths that people believe today. There is no denying that it is so important to understand your credit rating and the different factors that have an influence on it. 

This has been a Collaborative Post 

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