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Busting the Top 5 Credit Myths

Anyone who has purchased a home or is currently wanting to buy, or rent can tell you that credit score is one of the most important factors considered by banks or rental owners. A bad score can affect a lot of areas of your life but is particularly detrimental in the real estate world.

5 Common Myths About Credit and Why They Aren’t True

Everyone has an opinion about credit scores, but we are here to breakdown these frequently-believed myths and explain what they really mean.

MYTH 1: All debt is bad and will lower your credit score

Person managing their credit

Debt is a scary word. Most of us believe that having ANY debt looks bad and will negatively affect credit. However, there is a big difference between debt that can benefit your score and debt that can hurt it. 

If you rack up thousands in credit card debt or do not pay bills on time, this will surely hurt your rating. If you take out a mortgage on a home, this shouldn’t hurt, if you make your payments on time. 

MYTH 2: Checking my score will damage my rating

Checking a credit score with a tablet

This myth is simply NOT true. When you use a service to check your own score, it has no impact on your rating. Furthermore, you are allowed one free check per repository (Transunion, Experian and Equifax) each year. 

It’s when you APPLY for credit and a creditor is required to check your score that may bring down your rating. Especially if you do it frequently. (Think of all those department store cards you are offered for 10% off your purchase. Too much of a good thing can be bad for your credit score.)

MYTH 3: If you don’t use a credit card, you should close it

Credit cards in wallet

Find that you aren’t using a card as often as you used to? It’s not always wise to close the account. A portion of your credit score is determined by the LENGTH of time that credit is open. If you can, try and use the credit card every now and then to avoid the creditor closing your account entirely due to inactivity.

MYTH 4: You can improve your score “immediately” by paying off debt

Coins growing a tree

You should always try and make your monthly payments and pay debt off to avoid interest that accrues. But if you miss a payment, making that payment (even the very next day), won’t remove the problem from your score. Missed or late payments can drop your score significantly, so it’s critical to pay debts on time.

MYTH 5: If I payoff a collection, it will be removed from my credit report

Person writing a list

Make every attempt to settle a debt BEFORE it goes to collection. If not, pay it off as soon as possible. Once it is paid off, the collection remains on your report for 7 years. 

Need info on how to repair your score? Visit for more information.

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