CREDIT SCORE

Published By Moushumi Mahanta | 02 Aug, 2024

Your credit card application may be denied due to a low credit score or insufficient credit history. However, there are many myths about credit scores that you should be aware of.

Here are some credit score myths you shouldn't believe:

Your income is the culprit

Your credit score is not influenced by income levels; it's determined by credit behavior and management. A high salary doesn’t guarantee a good score if credit habits are poor, while someone with lower income can still have a high score with responsible credit use. Credit : PIXABAY

Credit card balance increases credit score

Keeping a balance on your credit card for an extended period can hurt your credit score. To maintain a good score, clear your credit card dues promptly and avoid carrying a high balance. Credit : PEXELS

Need not worry about your student loans

Student loans do not negatively impact your credit score if managed properly. Timely payments on all bills, including student loans, are crucial. Set up autopay to stay current and check for possible interest rate discounts. Credit : PEXELS

You cannot improve your credit score

A low credit score is not permanent and can be improved over time with responsible credit management. Consistently applying good credit habits can gradually enhance your score. Credit : PEXELS

Closing old accounts improve credit score

Closing old credit accounts can negatively impact your credit score by shortening your credit history. Maintaining long-standing accounts with high limits but low balances can positively influence your score. Credit : PEXELS

New credit cards reduce credit score

Applying for a new credit card affects your credit score only if you apply to multiple providers within a short period. Limit inquiries by applying to a single reputable provider to avoid potential score damage. Credit : PEXELS

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