Our mission at Hibbs Insurance is to help you get the best possible rates on your insurance policies. And one of the best ways to do that is to help boost your credit score—because carriers evaluate your score when setting premiums. So, let’s discuss a few of the most common credit score myths that could hamper your financial health.
Myth: Checking your score could negatively affect it.
This is one of the more common credit score myths. But a mere check from a credit bureau is considered a “soft pull,” and it doesn’t hurt your score. However, a “hard pull” will. Hard pulls are related to credit applications, such as loans. They indicate you’re about to incur debt, and therefore, they can lower your total.
Myth: Spouses get combined scores.
Nope. Your credit score is linked to your social security number and belongs only to you. However, you can share joint accounts with your spouse for items like mortgages and credit cards. Those shared items will appear on your credit reports and impact your scores.
Myth: A credit card balance will boost your score.
A constant credit card balance can hurt your score because it could impact your utilization rate. This rate measures the amount of available credit you’re using, and your score could take a hit if this percentage is too high.
Myth: Paying off debt will give your score a boost.
Your score might increase if you pay off credit card debt, but it won’t for a mortgage or car loan. It might even lower if paying off the debt means closing a credit account.
If you want to know more about credit scores, read our advice on keeping yours as high as possible. A high score could mean a lower insurance premium, so learn as much as possible. And watch out for other credit card myths that could impact your finances.