My online score is my credit score

  • False, there are four industries that credit is pulled in. Online, credit card, auto loan, mortgage. Each industry has different scoring models and the more debt you are assuming to go into the lower your score will be. Online score are always the highest and mortgage scores are always the lowest.


Buying a car will raise my credit score

  • False, an auto loan is a type of installment loan. Similar to mortgages and student loans, they do not factor into building your credit score.                  


The more credit cards the more it will help my score

  • False, all credit cards weigh the same regardless of their limits. Having one card is the same as having multiple cards. It’s the utilization of total credit that factors into the FICO formulas.


Paying off a collection will remove it from my credit report and help my score

  • False, paying a collection will often times lower your score, depending if the company reports the payment or not. Either way the item needs to be deleted from the report for the score to rise.


I have the divorce decree and the judge said ... so it should not affect my score

  • False, lenders do not care about the success or failure of your marriage. Just because a judge says one person has to pay off a loan or account, any positive or negative account information is attached to both reports as long as they were signers at the time the account was opened.


When I pay off my cards I’ll close them all so I don’t have to worry about them

  • False, closing accounts negatively impacts a credit score as it impacts the average length of open and active trade lines. You can never get over a 699 score without 2-3 years average length and you can never get over 799 without 8-10 years average length



Biggest Credit Misconceptions

  • Installment loans such as mortgage, auto and student loans are not factored into building a score (when it comes to their balances). Paying these down or off will not increase your credit score
  • All revolving credit accounts are weighted equally. (ex. a $200 Capital One card is worth the same in credit score as a $50,000 Visa card).
  • Being current on loans and credit cards, does not erase late payment from the past
  • The statute of limitations only applies to the date the item was last active (DLA) if it is bought and resold each time it gets reported the statute of limitations is reset
  • Paying off collections does not remove them from the credit report. Similar to a speeding ticket, paying it off is good but does not remove it from your driving record.
  • I’ll just clean up my report on my own…anyone can attempt but often fall short as they think the bureaus are on their side and try to “dispute” items with the bureaus, which is the route they want you to go. You hire a professional for a reason!

Credit Myths

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