Three Biggest Myths About Raising Your Credit Score
Raising your credit score is not very hard and can be done fairly quickly. Before you start, you need to learn what the most common credit score myths are and make sure you don’t fall for them.
1. Asking my credit company to lower my spending limit should help my score.
No. This is not true and asking your lenders to lower your credit limits will actually hurt your credit score. Why? Because the bigger the difference between what you owe and what you are allowed to owe, the better your credit score. By closing your credit card account or by lowering your credit limit you are shrinking your total available credit. This makes the difference smaller and therefore your credit score lower.
2. If I transfer all my small balances to a single card, it will help my score.
Transferring everything you owe to a single high-limit card may give you a better idea on how much you owe and may make it easier to control your finances, but it will certainly not raise your credit score. It will probably lower it a bit.
3. A higher salary will boost my credit score.
A higher salary can boost your credit score only if you are using the extra money to pay off your credit debt. Even winning a million dollar lottery is not going to raise your credit score, because your net worth and your income have nothing to do with your credit score.
