Certain myths about credit scores are circulating around and believing them can do real damage to your personal credit. So what should you believe and what should you dismiss? On this post, we present the four  biggest credit score myths and the truth behind them.
Myth #1. You need to regularly carry a balance to boost your credit score.
This is a big mistake since carrying a balance actually increases the risk of debt build-up and bad credit, not to mention the fact that the card holder pays a lot more on interest rate charges. The truth is, you do not need to carry a balance at all to build a solid credit score.
What you should do is to make sure that you can pay off your balance in full and on time. Paying in full enables you to save money because you don’t need to pay interest rate. Second, zeroing in your balance minimizes the risk of debt accumulation.
Myth #2. Checking your own credit report can hurt your score.
Checking your own credit will not hurt your score. What can hurt your score are hard inquiries made by creditors or lenders in response to your application. And if the credit bureaus see a lot of inquiries to different creditors at such a short interval, you will be marked down.
If you are searching for a good loan or credit card deal, do not submit multiple applications to too many companies at once. Do your research first so you can narrow down your options to two or three creditors. More importantly, you are advised to check your own credit report prior to submitting your application to any lender to make sure that it is accurate and that no errors are pulling down your score.
Myth #3. You should cancel all credit card accounts that you do not use.
First of all, you should never close an account if you still have an unpaid balance. Second, you need to be very careful when deciding which accounts to close. If you’ve had that credit card for a long time, cancelling it now would mean erasing the old parts of your credit history. Since the length of credit history is one of the basis of your credit score, closing an old account can significantly hurt your rating.
Myth #4. Owning multiple credit cards is enough to have good credit.
Having a number of credit cards in your name is not a problem if you manage all your accounts well. However, managing too many credit cards can be difficult especially when you run up balances on all cards. If you fail to keep up with your credit card payments, you can be in big trouble.
The truth is, owning one or two credit cards makes management a lot easier. If you are after a high credit score, what you need is to show your capability to manage different types of account. Aside from credit cards, it will be great if you have a car loan or a mortgage loan in your name since types of credit makes up 10% of your final FICO score. Of course, that is assuming that you are submitting your loan payments on time.

About the Author

Melanie Mathis is a credit analyst and a writer for 8 years. She has been participating in the programs of NHBS, Inc such as their continuous effort in giving out Free Credit Repair and Building Ebook. NHBS also has a list of recommended Student Credit Cards

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About Melanie Mathis

Melanie Mathis is a credit analyst and a writer for 8 years. She has been participating in the programs of NHBS, Inc such as their continuous effort in giving out Free Credit Repair and Building Ebook. Connect with Melanie Mathis on Google+