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UNtangling the Web of Credit Score Myths
What do spiders and credit scores have in common? Fangs, eight legs, a whole bunch of eyes, an intimidating aura… Okay, maybe just the last part is true. While spiders are UNdeniably spooky, much of the scare-factor surrounding credit scores is a result of misinformation.
Credit scores can be scary. That single number will affect some of the most significant financial decisions a person will make. We’re here to UNtangle the web of the most UNbelievably believed myths about credits scores to help combat your fears.
We can’t help with arachnophobia, though. You’re on your own there.
#1: Checking your credit score will lower it.
This is the most common misconception when it comes to credit scores. A soft credit check will not affect your standing. It’s a great way to keep tabs on your score. Kind of like when you spot a spider lurking in the corner of your room. Seeing it might be UNpleasant, but it’s better than being surprised later when it comes back to bite you.
Pro-tip: There is some truth to this myth. A hard credit check will ding your score, usually by a few points. With these pulls, however, your approval is required so they’ll never sneak up on you.
#2: You need revolving debt to build credit.
A credit score reflects how you manage debt, but that doesn’t mean you have to drag out your payments to prove yourself. If you’re able to pay off your debt, why wait? UNnecessarily carrying a balance will not boost your score, but it will weigh you down in more ways than one.
#3: You’ll be blacklisted for having a bad score.
There’s not a giant, evil arachnid with a clipboard determined to punish you for your credit score, even if it feels that way. A low score signals that you could pose a higher risk for some employers, landlords or financial institutions, resulting in often frustrating results. However, it’s not a universal red flag, nor is there a blacklist.
#4: There’s a “correct” way to earn a perfect score.
Things would be easier if this were true. Beyond the generic advice of making timely payments, monitoring your score and maintaining a long credit history, there’s no one-size-fits all approach to landing a higher score. Everyone’s credit journey will look different. Community Choice offers a variety of credit-focused services. If you want to UNcover the best path forward for improving your score, set up a meeting with one of our UNbankers today.
Now that we’ve escaped the web of myths, check some of our other credit score content.
This blog is intended for educational purposes only. For details about specific products or services, see credit union for details. For questions about investments, please consult your financial advisor.