Fix your credit problems

It’s no secret that many people lack a genuine understanding of credit scores – what they mean, how they are calculated, how your financial decisions influence them, and even how to find out what they are.


Failing to learn the right information about the basics of credit can be damaging to your credit score, especially if you are only relying on common credit myths to help you make financial decisions.


Below is a list of the 10 most common credit mistakes people unknowingly make. Whether you are guilty of one or all of them, you could be bringing your credit score down without even realizing it.



  1. “I don’t need credit” – If you are worried about racking up debt on credit cards, you might think sticking to debit cards and pre-paid credit cards is the way to go. However, what you may fail to realize is that no credit can be just as harmful as having bad credit. In other words, you can’t build credit if you don’t have any credit. You could be denied a mortgage or car loan, and even passed over by a landlord or potential employer if you can’t prove you have a good credit rating.


  1. “I only need one credit card” – Owning just one credit card and charging everything to the same account may seem like the easiest way to manage your spending. However, what lenders really want to see is evidence you can handle a diverse number of accounts – credit cards, car loan, mortgage and department store cards – before they approve you for more credit. This is true even if your credit account is in excellent standing. Credit mix accounts for about 10% of your credit score, so be sure to obtain credit from a variety of sources.


  1. “I should always have a balance on my credit card” – You don’t need to have a balance on your credit card to get a good credit score. Credit score is calculated based on payment history, credit utilization, length of credit, types of credit and new credit – balance does not factor into your credit score. As long as you pay your bills on time and keep your credit utilization under 30%, you will be rewarded with a good credit score.


  1. “I can only have one credit score” – Credit scores are provided by three different credit reporting bureaus – Experian, TransUnion, and Equifax – all of which use a different formula for calculating your credit score. Keeping this in mind, it’s obvious they aren’t going to come up with the same credit scoreFurthermore, based on what financial information has been reported to them, it’s possible they could be calculating your score using varying credit information. Realistically, you shouldn’t see a large difference in your scores, but they can vary by a few points.


  1. “I should close some of my credit accounts” – Many consumers choose to close accounts – particularly if they aren’t using them, have paid them off or are worried they have too many – without realizing their credit score could be affected. This may be a bad idea for a couple of reasons. Firstly, closing an account could lower your credit utilization (which accounts for about 30% of your credit score) since you will immediately have access to less credit. Secondly, if the closed accounts are some of your oldest credit accounts, your length of credit can be shortened, (which affects about 10% of your credit score).


  1. “Settling an account will make it go away” – This is simply not true. If you have an account that has gone to collection or includes late payments, paying off this debt does not erase its negative history. In fact, it stays on your file for 7 years from the date of your first offense. Although paying off delinquent accounts is a sign of good intention, it doesn’t make the delinquency disappear. This is why you should pay your bills on time every month without exception.


  1. “Increasing my credit limit is always a bad idea” – Unless you are a reckless spender who will just rack up more debt when your limit is raised, an increase in credit can be a good thing. Lenders will often increase your limit when you have been responsible with your finances and have paid your debts on time. Unless your spending habits change dramatically, this increase in credit will lower your debt-to-credit ratio, improving your credit score.


  1. “It’s not a big deal to co-sign a loan” – You should never agree to co-sign a loan, credit card or any other financial obligation for anyone unless you are confident they will be financially responsible. You may be asked by a friend or family member to co-sign a loan when they can’t get approval on their own (usually because they have little or no credit). Don’t make the decision to become a co-signer lightly; if they default on a payment, your credit score could take a hit.


  1. “If I make more money, my credit score will be better” – Your income and your credit score have absolutely nothing to do with each other. As mentioned previously, credit score is based on payment history, credit utilization, length of credit history, types of credit, and new credit alone. The Equal Credit Opportunity Act also states credit cannot be based on age, race, religion, national origin, sex, or marital status.


  1. “Checking my credit score is a bad idea” – Most people have no idea what their credit score is. Requesting your credit score (making a “soft inquiry”) has no effect on your credit score and should be done regularly so you can monitor it for errors, inaccuracies, or signs of identity theft. However, when you are seeking new credit, banks or other lenders make “hard inquiries”, which can impact the portion of your credit score under “new credit” (up to 10% of your total credit score).



Avoid falling victim to the pitfalls of credit myths


Whether you are aware of your mistakes or not, making bad financial decisions about you credit can seriously compromise any financial goals you are working towards.


Take the time to learn as much as you can about FICO scoring so you can make sound credit decisions. Request copies of your credit score so you know where you stand and consult experts if you need help or want to learn more.


Your path to financial freedom can start today with Great American Credit Repair Company.  Contact us at 1-800-603-1943 to receive expert advice on how you can begin rebuilding your credit score right away.


About Great American Credit Repair Company


Great American Credit Repair Company…….because you deserve a fresh start! Call us today at 1-800-603-1943 for your FREE consultation. Our financial experts will work diligently on your behalf to raise your credit score and repair bad credit. We are attorney-approved and offer the industry’s only Money Back Triple Results Warranty to protect your investment.


How does Great American Credit Repair work to restore your credit? Approximately 79% of all credit reports contain errors and aren’t verifiable. At Great American Credit Repair Company, we have proficient understanding of the rules Credit Bureaus are bound to and how to resolve common but substantial threats to your credit score. We know most people don’t earn the credit score they deserve and will investigate every negative aspect of your credit report every single month to make sure you get the highest credit score possible.

REPAIR YOUR CREDIT TODAY by calling us Toll Free: 1 (800) 603-1943 or visiting us at