Five Credit Myths You Should Know About

1.  You can improve your credit rating by closing your credit card accounts.

NOT TRUE! Closing your credit card account adds to the shortening of the age of your credit account, which is included in the primary decisive factors of your credit rating. The scores on your credit report, for that reason, will not improve even if you do opt to cancel your credit card accounts.

2. Credit scores are increased once you repay your installment loans.

NOT TRUE! Accomplishing installment liabilities will not increase your credit score. The factor that has implications on your credit score is not the total amount of money you spent for the loan, but the exact date you paid back the loan. In fact, consumer credit report agents are only focused on verifying if you settled your balance on time or not.

3. It is impossible to get more than one credit score.If you receive your credit reports from different agencies, then your credit scores will all look the same.You can only get one credit score.

NOT TRUE! In reality you can receive as many as three credit scores. Each of the three leading credit reporting agencies in the country has its unique procedure of calculating your credit score. The estimations achieved by the three companies translate to three credit scores with slight differences. The three credit scores are acknowledged by the FICO, which is the organization that is accountable for the calculation of your FICO scores.

4. You can never remove a negative entry in your credit report until the seven-year requirement is up.

NOT TRUE! A poor mark, whether it is a late payment entry or an existing loan item, can be deleted from your credit record. You can initiate this by requesting a goodwill adjustment from your loaners or by disputing the imprecision of your credit data.

5. It is possible to improve credit score through the maintenance of your credit account balance.

NOT TRUE! It is actually the opposite. It is perfectly fine to have credit card activity; but it doesn't affect your credit balance. Maintaining a substantially low balance or no balance at all is actually one of the best means to preserve a good credit score and improve it.


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