Credit scores are some of the most opaque ratings you’re likely to encounter in your life. Each credit reporting agency has their own calculations kept as a closely guarded secret, and that can make figuring out what does and doesn’t affect your score a bit of a guessing game.

And that’s deeply unfortunate, because our credit scores impact our lives in so many important ways. From accessing low-interest loans (or loans at all!) to applying for apartments and even jobs, our credit history and associated credit score can shape our lives to no end. 

Given this intersection of importance and inscrutability, it’s little wonder that plenty of myths and falsehoods surround credit scores and credit reporting. Here are just a few of the biggest credit score myths you’ll want to correct in your head:

1. A high credit score means you’ll automatically get the best terms

In most peoples’ minds, a credit score is fairly binary–if your score is high, you get great interest rates and access to all sorts of credit opportunities. If your score is low, you don’t. Plain and simple. While having a credit score as high as possible is hugely important to strive towards, if you’re already there, you can’t assume you’ll automatically get all those deals.

Why not? It’s because credit reporting consists of far more than just your numeric score. For example, credit history is a big part of your report and an important contributing factor to just about any loan you try to take out. If you’re a 21-year-old with one low-limit credit card that you pay off every month, your score may be high because you’ve had nothing to ding against it, but your credit history will also be weak, meaning lenders can still perceive you as a risk or uncertainty (but also, good for you–you’re building healthy financial habits so keep going!).

2. Closing credit cards will boost your credit score

It’s an easy mindset to fall into: “Opening too many credit cards hurts my credit, so closing those cards will help it!” And we get it–that makes a lot of intuitive sense, doesn’t it? But credit is rarely fully intuitive, and this is one such instance. Because maintaining active lines of credit generally helps bolster your score, closing your credit cards can mean actually taking a hit to your score, which isn’t what you want.

Now, there may be other reasons to close a credit card: high interest rates, onerous annual fees, or just cutting off a source of temptation for reckless spending can all make closing an account worth it. But if you decide to close a credit card, just be prepared to take that credit score ding and move on.

3. Paying off debts increases your credit score

This is another one that feels so right, and yet–often infuriatingly–just isn’t. If a credit score is meant to be a calculation of your responsibility with carrying debt, then surely they’ll see that paying off a debt in full shows the most financial responsibility, right?

Sadly, no–because your credit score tracks how responsible you are at managing the debt you do carry (making on-time payments, utilizing less than your allotted credit limits, etc), ceasing to have those lines of credit at all can negatively impact your overall score. 

Of course, paying off debt is still an unequivocally good practice–it means we pay less in interest, it means we free up money to use for other responsibilities, and it just takes stress off our minds. But just bear in mind that when you pay off that car loan or that mortgage, your credit score likely won’t see the bump you’re expecting in your head.

4. Credit scores don’t matter when you’re young

Just like regular doctor’s visits and saving for retirement, credit scores are often seen as something that only really matters once you’re old. Especially with younger generations who see milestones like home ownership as largely out-of-reach, it can be hard to convince someone who’s just coming into adulthood that they need to care about their credit.

But having great credit when you’re older is made significantly easier by building that credit early. When you finally get into that position to be looking at mortgages or other larger loans, you’ll want that score to not only be as high as possible, but you’ll want them to see a long credit history of on-time payments, varied lines of credit, and overall responsible behavior. And starting that practice young doesn’t only benefit you in the long term, it can also benefit your ability to rent good apartments, find good jobs, and get better interest rates on the debts you do take out.

5. Fixing your credit score isn’t worth the time

For some people, the despair that comes with having a particularly low credit score can turn into futility. They hear how important credit is and how hard it can be to build, and resign themselves to a life of sketchy loan sharks, buy-here-pay-here car lots, and cash transactions for everything possible.

But while rebuilding credit isn’t easy, it’s far from impossible and often can happen more quickly than you think by just taking a few easy steps. Checking your credit report for errors (and correcting them); making consistent and on-time monthly payments for every debt (even if you aren’t always paying down the principle), and maintaining low utilization of your credit cards can all help increase your credit score back to a point where you’re able to live a life without fretting.

Spotloan: A Smarter Way to Borrow

Navigating how to build and maintain your credit score is tough and often confusing work, and sometimes you need more immediate help while you practice that long-term responsibility. At Spotloan, our simple online application process can help you qualify for the money you need, even if you have bad credit or need a loan quickly. All you have to do is go fill out our application to see if you qualify, and you could receive a decision within minutes. Fill out our application now!