Even with the amount of information about credit card son the internet, people will still believe the myths that fly around about credit cards. here are some common myths about credit cards and the truth about them.
Your bad credit score will last forever
A bad credit score can last you forever but only if you continue making financial choices that will hurt the credit score. making late payments, letting your bills go to collections and maxing out the credit cards are some of the things that make the bad credit last longer than it should.
Only rich people have great credit scores
The income is not a major factor when it comes to the credit score. The amount of cash you have is only secondary when it comes to credit scores. It does not matter than you do not have a lot of money, as long as you pay the bills on time the credit will come out great. Bill payment habits play a big role in how great your credit score will come out.
Checking your credit score gives you a negative point
Just because people believe that they lose points for checking their scores, many will not. The truth is, you can check on it as many times as you want as long as the services are open. Make sure you are checking with the credit card service and not other lenders.
It takes a long time for the credit score to register negatives
It can take you a few months to ruin a good credit score. For instance, an account that is 6 months past due will be charged off. This is one of the worst things that could happen to your credit score. Multiple charge offs can ruin your credit score completely.
The credit score you check will be the same one that the lender uses
The credit score accessible to you online is educations and not the same one your lender is going to use. The educational score can give you an idea of your credit health and your financial transactions will not be approved based on that score.
Prepaid cards and debit cards can help build your score
If you applied for a debit and prepaid card so you can build your score, then there is bad news for you. The history in these two cards is not factored into your credit score. The primary financial product that have impact on your credit score are loans and credit cards.
Closing a credit card with issues will help improve your scores
Closing the credit card to save your score will not work. In fact, it is more likely going to hurt your credit score than help you. If you close the card with a balance, it makes the situation worse.
Bad credit means you will never have an approval for anything
While a bad credit makes it harder for you to get approved for multiple things, it is not a restriction. Some lenders will approve your loan even with a bad credit but you will have to make the repayments at higher interest rates and also need to make a security deposit first.