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Credit Fact or Fiction?


Produced by American Express, VantageScore Solutions and TransUnion

Credit myths and credit misconceptions are plentiful. Don’t let incorrect information influence your credit behavior. Test your knowledge and see how well do you know your credit facts.

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1. There is only one true credit score.


Answer: Fiction

You may actually have many credit scores. Different companies, including VantageScore Solutions, develop credit scoring models and lenders choose which best fit their needs. It’s important to track your credit behaviors in your credit report because that information in the report can impact your different credit scores.


2. Credit scores and reports are the same thing.


Answer: Fiction

Credit reports contain information about your past behavior when it comes to borrowing and making on-time payments. Models that generate credit scores use information from the credit report to produce your score. You can access your TransUnion credit report and VantageScore 3.0 credit score for free with American Express’s MyCredit Guide.


3. Your credit score doesn’t care how rich you are.


Answer: Fact

You can be rich and still have a very low credit score. Your income and your net worth are not part of your credit report and therefore are not information used to determine your credit score.


4. Checking your credit report hurts your score.


Answer: Fiction

Your credit score is not impacted when you check your own credit report, which is often referred to as a soft inquiry. In fact, it’s important to check both your credit report and your credit score consistently to make sure you are monitoring these key pieces of your financial life.


5. You can check your credit report & score for free.


Answer: Fact

There are many ways to access your credit report and score for free. Under federal law, you are entitled to a free check of your credit report from each credit bureau once a year. You can access your TransUnion credit report and VantageScore 3.0 credit score for free with American Express’s MyCredit Guide.


6. Rebuilding your credit score takes time.


Answer: Fact

The unexpected can happen, like a global pandemic, and your credit score may be impacted by temporary or longer-term inability to make on-time payments. Don’t be demoralized. The late payment information will eventually roll off your report as you continue good credit behavior over time.


7. To increase your score, never pay off your credit cards in full.


Answer: Fiction

There is a popular myth that in order to have a credit score or to increase your score you need to carry a balance on your credit card accounts. This is not true. In fact, having a low balance or zero balance is likely to increase your credit score.


8. Missing a payment is the worst thing for your credit score.


Answer: Fact

A key indicator of whether you will pay on-time in the future is if you have paid on-time in the past, so missing a payment can have a significantly negative impact on your credit score. However, by making on-time payments moving forward, you can rebuild your credit score over time.

How many of the 8 credit statements did you know?


Don’t worry if you didn’t get every statement right. There's always more to learn about credit. And be sure to check your credit score and report with MyCredit Guide from American Express

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