Bad credit scores can be a massive headache, causing you to pay more for loans, insurance, and rent. But what causes a bad credit score? And is there anything you can do to improve it? This blog post will debunk the five most common myths about bad credit scores. Once you have the facts, you can start taking steps to improve your score and get on the path to financial success. You can read more to get best bad credit loans with APRs from 6% to 36% for your unique circumstances and help build a stable financial future.
You Can’t Get a Loan With a Bad Credit Score
This is one of the most common myths about bad credit scores. While it is true that you may have to pay higher interest rates on loans with bad credit, there are still plenty of lenders that work with borrowers with poor credit. So don’t let a low score stop you from shopping for the best loan terms.
You Need a Balance on Your Credit Card to Build Credit
Another common myth is that you must carry a balance on your credit cards to build credit. This is the opposite of what you should do. A balance will only hurt your score because it increases your credit utilization ratio. Instead, it would help if you aimed to pay off your balances in full each month.
Closing Unused Credit Cards Will Help Your Score
If you have unused credit cards, you may be tempted to close them to improve your credit score. However, this is a myth! Closing new credit cards can hurt your score because it lowers your available credit. To get rid of unused credit cards, you should cut them up and throw them away.
Checking Your Credit Score Will Lower It
Many people believe that regularly checking their credit score will somehow lower it. However, this is not the case! Checking your credit score will not lower it; it can be a good thing. By regularly monitoring your score, you can catch any potential problems early on and take steps to improve your score. In addition, many credit card companies now offer free credit scores to their customers.
Bad credit scores can be a huge headache, causing you to pay more for loans, insurance, and rent. But what causes a bad credit score? And is there anything you can do to improve it? In this blog post, we have debunked the five most common myths about bad credit scores.