There are many misconceptions about credit that can lead to poor financial decisions. Here, we debunk some of the most common credit myths:
Myth 1: Checking Your Credit Hurts Your Score
Many people believe that checking their own credit score will negatively impact it. In reality, this is known as a soft inquiry and does not affect your score.
Myth 2: Closing Old Accounts Improves Your Score
Closing old credit accounts can actually hurt your score by reducing your credit history length and increasing your credit utilization ratio.
"Knowledge is power when it comes to managing your credit."
Myth 3: You Only Have One Credit Score
In fact, you have multiple credit scores, as different lenders may use different scoring models. It's essential to understand this to get a complete picture of your credit health.
