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10 Falsehoods About Credit That Can Cost You - WalletPop

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12/3/2009 9:28 AM

" says Kate Lister. And closing old accounts also removes your history. 10 Falsehoods About Credit That Can Cost You by Mary Fetzer Estimate Your Credit Score How many accounts do you have? Facts and Falsehoods When it comes to finances. retail cards. Colorado. Getty Images *Pending Identity Verification Experian." Murphy says. See Your Online Credit Report & Score > Falsehood No. Start Over See Your Credit Score Now at Experian > Falsehood No. auto loans. which is why Lister recommends getting a copy of each report every time you check your credit." which has no bearing on your credit score. Lister says.. she says.operate independently and do not share data. "Credit utilization is how much credit you use compared to how much credit is available to you. 3: Closing unused accounts lowers my available credit and will improve my score. a credit-management site for consumers. Fact: The three credit reporting agencies -. a credit-restoration company in Greeley. FE ATUR E D S P O NS O R Falsehood No. 1: I have one credit score. co-founder of Quizzle." says Lynnette Khalfani Cox. 4: Paying cash and carrying no debt will help my credit score. Fact: "You can check your credit report through a credit bureau as often as you like with no negative impact.especially with something as important as your credit score. you're decreasing the amount of credit available to you." Lister says. so your proportion of credit used will be higher -." says Dan Beck. "Following the wrong advice can impact your score in a negative way. "Review your credit report at least every six months to look for inaccuracies. Accordingly. it's important to know where you stand -. And because your score is constantly changing (it's recalculated whenever your credit report is pulled). "The information each reports is The credit survey is for educational purpos and the Score range generated is based so the information you and Trans-Union -. author of Finding Money.Equifax. you may hurt your score. Checking your own credit is considered a "soft inquiry. very different. it's actually a big zero for your score. By closing accounts. president of Credit Management Specialists. mortgage student loans.. While it feels fiscally responsible to close out an account that's at zero. Next Question > One Account Include open and closed accounts for cre cards. a personalfinance expert. and it's locked in for a year. because a lot of inquiries can lower my score.and that makes you a higher risk in the eyes of lenders. "If you cancel a credit card that has a lot of history.walletpop. 2 of 5 12/3/2009 9:28 AM .10 Falsehoods About Credit That Can Cost You ." says Ann-Marie Murphy. 2: I shouldn't check my credit too often. Are you clear on how to boost your score? "You have to be careful who you listen to. FE ATUR E D S P Free Credit Report and Score First Name Last Name Checking your own credit does not lower you FEATUR ED S PO NS O R Closing out a credit card account after you've paid it off helps your credit score? Yes No Vote > Falsehood No.WalletPop http://www. Fact: Not so. we present the 10 most common (and most costly) falsehoods about credit. one of the biggest things that factor into credit score. etc. your credit reports and scores will differ from one agency to another." Here. Other soft inquiries are those made by existing lenders reviewing your account and lenders trying to offer you pre-approved credit.

before you pay your bill. 8: Incorrect personal information negatively impacts my score." Brander says. this is an example of how someone who handles their credit responsibly can be penalized by the credit-scoring system. and age are not factors in credit scoring. but it won't make the collection red mark on your report go away. says Hawkins. marital status. Fact: Paying a collection account in full is the fiscally responsible thing to do. employment history. Falsehood No. "If you are heavy in one area of credit. says credit administrator Michele Brander. gender. author of The First Name Last Name Submit > Credit Reality Today. Fact: Various types of credit will impact your score differently." The longer you have an account and pay on time. What's vital is that you establish your ability to pay your debts on time. Fact: The credit-scoring agency has no record of your income." says Wayne Sanford. Falsehood No. derogatory information will be removed from my report. Fact: Not necessarily. and 10 percent of your score refers to your mix of credit." says John Rackley. Fact: "Having no credit history or never using credit has a negative impact on your credit score. "Focus on lowering your credit card utilization in order to get a big boost in your scores. Though your mortgage or student loans are important. And if your credit is pulled mid-month. your score will reflect that balance. the greater the benefit to your score. "FICO reports that people with no credit cards tend to be higher risk than those who use credit cards responsibly. "The only way to be sure your balance shows as zero is to cease using the card for a month or more. The account may be marked as paid in full. 10: One missed payment won't hurt my credit score." says Cox.. Fact: Your personal information has no impact on your credit score. Falsehood No. it has a positive effect on my score. and is therefore not factored into your credit score. co-founder the Certified Credit Report Reviewer Certification Program with the Institute of Consumer Financial Education. "" F EATUR ED SP O NSO R Free Credit Report and Score Checking your own credit does not lower your score! Falsehood No. "Income. 7: If my debt is less than 30 percent of my income.. But the credit-scoring systems are chiefly concerned with credit-card debt." says Hallie Hawkins. 6: Paying off my credit-card balances every month improves my credit score. "The single biggest determinant of your credit 3 of 5 12/3/2009 9:28 AM . your score may be lower." FE ATUR E D S P O NS O R Falsehood No. Falsehood No. which is important.10 Falsehoods About Credit That Can Cost You .walletpop. religion. race. Fact: Think again before you flake out on that one payment. the bank doesn't notify the credit bureaus. but it will remain on your credit report for seven years.WalletPop http://www. "When you pay off your credit-card bill. a certified mortgage-planning specialist. "Having a big credit-card debt will hurt you. national origin. 5: All debt is created equal. 9: Once a collections account is settled." Cox says.

Mary Fetzer is a freelance writer specializing in the web's best online portfolio manager and the latest business & market news. you can take complete control of your credit score." says Murphy. how late they were. Free of Falsehoods "Ignorance is not bliss when it comes to your credit score. and how long ago the late payments occurred. real estate. DailyFinance Luxist ParentDish Engadget Rentals Emurse Golf's Biggest Earners Holiday Ideas DIY Life Visit Money & Finance for stock quotes. and parenting issues." says Cox. saving money and investing money. Get Your Credit Report at Experian! More Money & Finance More on WalletPop Quick Links WalletPop Blog Calculators Economizer Interest Rates WalletPop Specials WalletPop RSS Feeds Deals Madoff Pig Flu Banking Credit Debt Fraud Insurance Loans Tax Credit Income Tax Online Tax Filing Tax Advice Starbucks Via Review Finance Main Financial Crisis Stock Quotes Stock Charts Historical Stock Prices Portfolios Stock Screener Earnings Common Tax Filing Mistakes Small Business Checking Account More Blogs & Sites Download Squad TUAW Joystiq Autoblog Sports News Fantasy Football Fantasy Baseball Politics Daily Money Coaches MMA Fighter Salaries Christmas Songs Zhu Zhu Pets More WalletPop Contact Us Mortgages Real Estate Recalls Recession Retirement Taxes Audit AMT Tax Deductions Tax Forms Credit Score Calculator More Blogs & Sites BloggingStocks BloggingBuyouts 24/7 Wall St. Now that you're free of falsehoods and armed with facts. Terms of Service | Privacy Policy | Trademarks | Help 4 of 5 12/3/2009 9:28 AM . Credit-scoring formulas take into account your late payments.10 Falsehoods About Credit That Can Cost You . Find out about every aspect of personal finance and money management..WalletPop http://www. score is how well you've paid your bills in the past. from finding the best mortgage rates and preventing identity theft to making money.

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