Below are some of my favorite credit myths. Feel free to post your own!
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1. Paying off a collection account or settling a debt will improve your credit score. Or, paying a collection makes it a positive account.
2. Closing old, unused accounts will improve your credit score.
3. You should never have more than 2 or 3 credit cards.
4. The only way to fix your credit is wait 7 years for all the negative information to age off.
5. Credit reports are always accurate.
6. Bankruptcy is the end of the world and you will never be able to buy a house or a car.
7. I shouldn't look at my own credit reports, that will lower my score.
8. Having a mortgage will improve your FICO by 100 - 150 points if you're below 600.
9. You need a co-signer to buy a car with $0 down.
10. Never PIF on a credit card, because your credit report will show that you never use the card.
11. If you keep a good relationship with a bank (checking / savings acct.), they're much more likely to overlook your credit report.
12. If an inquiry shows on your CR, as long as your were approved and the account is showing, the inquiry doesn't hurt your score.
13. Everyone pays 18% on car loans and 25% on credit cards.
14. If you don't need a large CL, you should request a lower CL.
15. If you contact a creditor that would change the date of last activity; thus start the 7 year reporting period all over again.
16. Maxing out credit cards doesn't hurt your credit.
17. Collectors can harass you for a 7+ year old debt.
18. Adding a personal statement to a CR explaining a judgment or collection is a good thing.
19. CC companies never lower your limit or close your account as long as
pay the minimum and on time.
20. The CRA's share the same information
21. An occassional 30 day late isn't a big deal
22. Disputing an account, making a payment on an account, the transfer to a collection agency always starts the 7 year clock over.
23. If I succeed in deleting a negative item, it will just come right back on my credit report.
24. If I declare bankruptcy, I can begin my credit report all over with a clean slate.
25. Medical bills don't count.
26. Pre-Approved equals guaranteed approval.
27. I have no recourse after being denied credit.
28. Student loans don't help your credit at all.
29. Having NO credit is better than BAD credit