Archive · 23 Jun 2025
Busting Common Credit Score Myths Affecting Loan Approvals
Many people believe certain things about credit scores that aren't true, which can hurt their chances of getting loans.
Some think having a high income or paying off loans quickly is enough, but banks also look at how you manage your existing credit.
Checking your own credit score is safe, but multiple lender checks can lower it.
Closing old cards and missing payments can also harm your score.
It's best to make payments on time and keep older accounts active to boost your score.
Many people misunderstand credit scores, leading to myths impacting loan approvals.
High income doesn't guarantee a good credit score; credit mix and repayment matter.
Checking your own credit score doesn't hurt it, but lender checks can lower it briefly.
Closing old credit cards can shorten credit history, which may lower score.
Consistent, timely payments are key for a good credit score.
- Who
- Borrowers and lenders.
- What
- Common credit score myths and their impact on loan approvals.
- When
- Ongoing
- Where
- N/A
- Why
- To dispel common misconceptions about credit scores and promote responsible financial behavior.
Credit Score Misconceptions
Correct Credit Score Facts
Card Closing
Credit Score Misconceptions
Closing old credit cards boosts score.
Correct Credit Score Facts
Closing old cards lowers credit score.
Income Impact
Credit Score Misconceptions
High income guarantees a good score.
Correct Credit Score Facts
Income alone doesn't guarantee a good score.
- Impact of Self-Checks
- No impact on credit score
- Impact of Lender Checks
- May cause a temporary dip in score
- Closing Old Cards
- Can lower your credit score
- Missed Payments
- Can significantly hurt your score and remain on your report for years
- Good Credit Habits
- Pay bills on time, keep utilization low, and maintain old accounts
