Are you thinking about buying a home sometime soon? If you are, then odds are you’ll need to apply for a mortgage. Very few people are able to afford to pay for the full cost of a home out of their pockets. However, if you plan on applying for a mortgage, one thing that you’ll need to keep an eye on is your credit score. Your credit score can determine whether or not you qualify for good terms – or if you qualify for a mortgage at all. Unfortunately, there are a lot of credit score myths floating around that can be quite confusing. The following are a few credit score truths and myths to be aware of:

Credit score truths

The following are a few things you should know about credit scores that can help you maintain or improve yours:

  • Credit reports aren’t always accurate – Don’t assume that your credit report is 100 percent accurate. When you get your credit report, always go through it to make sure there aren’t any mistakes. You can report these mistakes to have them taken off your report, thereby helping improve your credit history and score.
     
  • Paying for everything in cash can help your credit rating – This is true to an extent. If you are working on paying down your credit card debt, then you should try to use cash for whatever you’re buying so that you don’t raise the balance of your credit cards. However, having credit cards with a zero balance over a long period can hurt as well.
     
  • You can pay for someone to fix your credit – This is also true to an extent. There are credit repair companies that will carefully go through your credit report in order to find any mistakes, then report them over and over gain to get them fixed. However, they aren’t going to make any blemishes simply disappear.
     
  • The amount of money in your bank affects your credit – While your score isn’t affected by how rich or poor you are, the amount of money you in your account have can affect your score. If you use your debit card or checks and overdraft because you don’t have enough money, that will damage your credit.
  • Having too many credit cards can hurt your score – Every time you apply for a new credit card, your credit score is hurt. Lenders looking at your credit report are going to be suspicious if you have a lot of credit cards as well.

Credit score myths

The following are a few credit score myths to avoid:

  • Paying off your credit cards will make your credit report spotless – Paying off your balance will help improve your score, but remember that your credit report is an overall credit history, not a snapshot of your present financial situation.
     
  • Canceling your credit cards will improve your credit score – Because you are lowering the total amount of credit you have, canceling credit cards can actually hurt your score.
     
  • Paying your bills on time means you don’t have to bother with your credit report – You still need to check your credit report for mistakes and know what your score is.
     
  • Checking your credit report will hurt your credit – You can check your credit as many times as you want without hurting your score.
  • Your three credit reports will be the same – They will usually be different from each other, but not by much.

These are some of the credit score truths and myths that you should know as you strive to improve your credit.