Top 4 Credit Score Related Myths

People who handle their own finances or like to keep a track of their finances to make sure that their credit score remains in the green zone, often come across various credit score related myths. The problem starts when they believe the wrong myth and adapt or avoid a habit that would’ve saved them from a really bad situation.

To save you from this headache, here is a list of the most common credit score related myths along with the corresponding facts.

·       Myth#1: Whether or Not You Get Credit is Majorly Dependent on Your Score.

True. A number of factors are taken into consideration by the lender regarding credit decisions and this includes FICO scores (a measure of consumer credit risk). Lenders also look at your employment history, the debt you can handle with your current income and yes, even your credit history. Based on all this, and the company’s policy, the lender could decide to extend or decline your request for credit.

·       Myth#2: Minorities Have to Face Unfair Credit Score Ratings.

False. Credit score is solely based on credit related information. If you think that factors like marital status, nationality, gender or even race are considered then you are seriously misinformed. These issues have been brought up in the past and after thorough investigation it was discovered that credit scoring is absolutely fair. If you think that your lenders are biased then you need to report it because it is illegal to do so.

·       Myth#3: When Lenders Check Your Credit History, They are Breaching Your Privacy.

False. Lenders can look at your credit history and they are legally prohibited from discussing it or disclosing it to anyone else. Lenders can only look at the numerical summary of your credit history, not all the details. They might call you in for more details if you have applied for an extension but that is just about it.

·       Myth#4: If You Have Poor Credit Score Now, Then It Will Remain With You Forever.

False. Actually quite the contrary is true. As your situation changes, so does your credit score. Whether you are doing well or bad will be reflected on the credit report. Lenders usually ask for current credit scores, but this doesn’t mean that you can’t improve your credit scores, and thereby your situation later on. 

If you want to improve your credit score sooner  than later then you can read effective credit repair tips and tricks on Quick Credit Repair. The website offers rapid DIY credit repair information that is bound to help you.