There is a lot of information around about credit scores. Most people realise that your credit score will have an effect on borrowing, but there is a lot of false information out there, that people believe. Some of the most common misconceptions are explained below.
- Credit Scores Are Always Correct There are many people that do not question their credit score. However, it is important to understand that your credit score is based on many factors and sometimes these are not updated. This means if you have had an outstanding balance on something, then it may be listed. If you applied for credit and did not use it, then it may be listed. It is possible to see a copy of your credit record and then you will be able to check the contents and request necessary changes to it, to be made.
- Checking Your Credit Score Will Lower It There are people that feel that checking your credit score will have an effect on the score itself. If a company checks your credit score, to see whether they will take you on, then this could change your score, but if you check it then it makes no difference.
- You Cannot Change Your Credit Score There are people that feel that there is very little that they can do to change their credit score and so there is no point in trying. However, this is simply not true. If you start paying bills on time and paying off debts, this will start to reflect in your credit score quite quickly and you could soon find yourself in a better position for borrowing money.
- Having Credit Improves Your Credit Score It is true that if you have some credit and you pay it back, then this will look good on your credit record. In fact if you have never had credit then you will be likely to score low as there is no evidence as to how well you will make repayments. However, having a lot of credit and not being able to make the repayments is not good. If you suddenly take out a lot of credit cards, for example, it can seem like you are struggling for money and that will work against you.
- Credit Score Can Affect Your Chances Of Getting Work Potential employers may like to look at your credit record when they are considering you for a job. However, they are unlikely to consider your actual score but look at your credit history. If they can see that things are improving, then they will probably be happy with that. It can be worth making sure that if you do want to improve your credit score, that you are aware of the facts. There are many things on the internet that are not true so go to a trusted source and find out more about it so that you can do the right things with regards to your credit score.
Loren is a freelance blogger who occasionally writes on finance and relationship, She recently read an article at Ratesupermarket about mortgage rate and found it very useful.