Your credit rating is a very important aspect of your life. It controls all sorts of things, from whether you can get a house to whether you can get a smartphone contract. It’s important to have a good credit score if you can, or at least try and boost it if it’s suffering.
But, a lot of us don’t truly understand credit ratings to their full extent. We hear myths that we believe, and this can lead to some seriously bad decisions. We’ve taken five of those myths and outlined them for you below.
1. There Is A Credit Blacklist
There’s no such thing! Some people believe that when they get a really poor credit score, they automatically get blacklisted. They will continue to argue until they’re blue in the face that it exists, but the simple fact is that it doesn’t. Lenders go off all sorts of information, but a blacklist is certainly not one of them.
2. A Poor Score Will Never Be Rebuilt
It’s true that rebuilding your credit score when it’s in a poor state can be tough. It won’t happen overnight, that’s for sure. But, it can definitely be rebuilt to a significant degree. In fact, as long as you make payments, everything from second charge secured loans to mobile payments can do it. All that matters is that you’re making regular payments without missing them.
3. More Money In The Bank Means A Better Rating
It doesn’t matter whatsoever! At the end of the day, your credit score is simply determined by whether you can make those payments on time. Sure, you might have a lot of money in the bank, but what does that matter to lenders? Why aren’t you giving it to them? They want regular payments; that’s all that matters.
4. Checking Your File Reduces Your Rating
This is a very common myth that is born out of confusion. Many people believe that if they check their credit rating too often, it reduces it. That isn’t true; you can get a copy of your credit report with ease, and it doesn’t affect your score at all. What does affect your score is failing a credit check for contracts over and over again. It’s important to know the difference, as getting a regular report might just be useful for your information.
5. The Electoral Roll Influence Is Just A Myth…
There’s a so-called myth going around that it’s not true that getting on the electoral roll enhances your credit rating. But… that’s the myth. It IS true! If you’re on the electoral roll, it confirms your identity at your address. It doesn’t matter if you never plan to vote… make sure you’re registered. It doesn’t take long, and it’s incredibly easy to do. What a perfect way to solidify your credit score with very little effort!
There are other credit rating myths out there, and you’ll have to search for the rest yourself. Keep in mind that your credit rating is fragile, and you don’t want to ruin it! Make smart decisions with your money.