Last Updated: September 21, 2022|Categories: Credit Building|

Fixing your credit score can be so overwhelming, especially when you’re given such conflicting information. How do you know who to trust or what to believe? When raising your credit is a top priority, it’s so important to get the right information to guide you in the right direction.

Here are eight credit myths we’ll gladly bust in order to make your credit-building process so much easier.

1. A Higher Salary Equals a Higher Credit Score

False. As much as we would all love for this to be true, how much you earn has no impact on your credit score. Your salary won’t appear on a credit report, no matter what credit bureau it’s requested from.

Lenders do, however, take into consideration how much you earn when approving loans. They usually keep your income in mind to make sure you’ll have enough money to pay back the debt you’re taking on when you take out a loan.

Besides that, a credit report will only contain detailed information on your debt management and credit utilization. We’ve put together a blog post that will help you understand what a credit utilization ratio is and how to calculate your own – check it out here.

Credit history length, credit utilization rate, how frequently you apply for new credit, and debt payment history are some factors that determine your score. It can be overwhelming to raise your credit score when you’re not sure what’s lowering it, so we put together a list of 5 best credit repair companies of 2022, including Lexington Law, Credit Saint, Sky Blue Credit Repair, and more.

These companies provide direct relationships with all 3 credit bureaus. They will also help you gain a deep understanding of possible problems you’re encountering with your credit reports. It’s important to have the right resources to help quickly and effectively resolve these common challenges. Don’t try to do it alone.

2. Having A Credit Card Balance Will Improve My Score

False. This is one myth that could harm your credit score the most. Paying back credit card debt can get so expensive. On top of what you borrowed, remember that you also have to pay back the interest accrued on your loan.

Piling up debt with no plan to pay it off is one of the most common mistakes people make. You’re not doing your credit any favors when your debt-to-credit utilization ratio is severely impacted. Healthy credit utilization is usually kept below 30%, and people in this range are favored by lenders.

3. You Can Improve Your Score if You Close Old Credit Cards

False. It makes sense to close credit cards you’re no longer using. However, this could have an adverse effect on your credit score. What you may not realize is that closing the account may have an impact on your debt-to-credit utilization ratio. The amount of credit you’re now using in comparison to your available amount will raise higher than that 30% threshold we mentioned.

Closing old credit cards could also decrease the length of your credit history since you’re no longer benefitting from the age of that closed account. Your credit history length is an essential contributor to your credit score. Instead of closing the account, contact your credit card provider and check if you can convert to a no-annual-fee option. You can also leave the account open but just don’t use the card if there are no fees.

Instead of trying this myth, Level Credit is a better idea for trying to build your credit score. For just $6.95/month or a one-time fee of $49.95, they send your best credit-building reports to the main credit bureaus, such as rent payments, cell phone, and utility payments. Level Credit also helps to monitor your TransUnion credit if you’re looking for a 2-in-1 solution. Learn more about the Best Credit Building Companies of 2022.

4. You Need a Perfect Credit Score to Qualify for the Best Rates

False. If you’re a perfectionist, it can be tempting to aim for a perfect score, but you really don’t need it. When your score reaches a certain threshold – generally in the upper 700s – most lenders will likely offer you the same benefits as they would to someone with a perfect score. There are certain benefits that might change, learn more about those here. If those benefits would help in your specific situation, then it might be ideal to aim for a perfect credit score in your case.

All else being equal, someone with a credit score of 750 who applies for a credit card offer is just as likely to be approved as someone with an 850. There are no designated credit offerings for people with a perfect score, so you aren’t missing out on anything if you never achieve one.

5. Your Credit Application Can’t Be Denied With Good Credit Score

False. Yes, you’re definitely off to a great start if you have a good credit score. However, each credit card application is unique. There’s a misconception that credit approvals are solely based on credit scores, but it couldn’t be further from the truth. Credit issuers have their own approval standards, so it can be hard to determine every requirement needed for approval.

The most common reasons you could be denied a credit card are lack of sufficient income, poor credit utilization ratio, already having too much debt, or too many recent applications.

6. My Student Loans Won’t Affect My Score

False. A student loan will appear on your credit reports like a mortgage or any other loan. Not paying your student loans on time will hurt your credit score since credit providers report all actions related to student loans.

Student loans are often installment loans, requiring you to pay a specific dollar amount over a set period of time. If you’re a student, there’s a chance this is the first line of credit you’ve received. Keeping a clean record on these loans could be the determining factor for all other first-time credit accounts you might need in your early adulthood.

7. Checking My Credit Will Harm My Score

False. This is such a big misconception. Fortunately, no matter how often you check your score, this will not appear on your credit report. The only inquiries that appear on reports are from credit applications. Lenders conduct what is called a hard inquiry when they check your credit score to see if you’re eligible for new credit.

If you or an employer conduct an inquiry, this is called a soft inquiry and does not appear on your credit report. Credit bureaus generally report on hard inquiries. It’s actually a good idea to check your credit to ensure there are no errors on your report. Here’s a guide to understanding what credit monitoring is and the best apps for credit monitoring. In a nutshell, you should address any errors to your credit score immediately, since these errors can lower your score.

8. Spouses Have One Joint Credit Score

False. Whether you’re single or get married, you’ll always have your own credit score. Getting married will never merge two spouses’ credit scores.

When applying for a mortgage loan or joint credit card, lenders will consider both individuals’ credit scores before deciding. These joint accounts will appear on each of your credit reports and impact both of your credit scores. However, if you decide to apply for credit in your name, only your credit score will be taken into consideration.

Bottom Line

You’re bound to come across many other myths as you work towards understanding your credit score. That’s why it’s so important to do your research and stay informed before making life-changing decisions. How you manage and utilize your credit will always be the biggest determining factor of your credit score health.

Monica Bulnes
About Monica Bulnes

Monica Bulnes is a business writer based out of San Diego, California. Monica received her business education from the top #7 best business school in the country, Rutgers University. She has worked in numerous marketing departments, including major multinational conglomerate, Panasonic. Her passion for personal finance and financial literacy is an extension of her passion for health and wellness. Monica truly believes that financial health is just as important as physical and mental health, considering the important role money plays in each and every person’s life. In her free time, you’ll find Monica inspiring the world through Instagram, writing in her journal, or sketching palm trees at the beach. To learn more about Monica and her writing, find her at

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