Do you know your credit fact from your credit fiction?
There’s a lot of information on the internet. But, let’s be real for a moment: sometimes, it’s hard to know if what we’re reading is informational gold or just a pile of poo.
Luckily, there’s something other than Wikipedia to help. In this quick quiz, we’re sorting the credit facts from the credit fictions. How many will you get right?
1. There’s a blacklist of banned people.
There’s no such thing as a blacklist of people who can’t get credit, even if your credit is poor. In fact, some lenders specialise in lending to those with poor credit ratings.
2. The more you earn, the better your credit rating.
How much you earn doesn’t affect your credit score. It’s about how you’ve managed credit in the past. However, lenders should only let you borrow in line with your earnings, to be confident they’ll get their money back.
3. Checking your credit report doesn’t harm your credit rating.
Checking your credit report doesn’t harm your credit rating. In fact, checking it regularly could give you the knowledge you need to improve your credit rating.
4. Your student loan affects your credit rating.
Anyone who’s taken out a student loan after 1998 doesn’t have their student loan information passed on to Credit Reference Agencies, so it can’t affect your credit rating.
5. You have more than one credit score.
You have three credit scores, one from each Credit Reference Agency: TransUnion, Experian, and Equifax. Your TotallyMoney credit score is calculated by TransUnion.
6. Your medical records affect your credit rating.
Your medical records aren’t passed on to Credit Reference Agencies, so they can’t affect your credit rating.
7. Your savings don’t affect your credit rating.
Your savings are about how much money you have in your bank account, and isn’t a form of credit. So, they can’t affect your credit rating.
8. Living with someone with bad credit can harm your credit rating.
The person you live with can’t affect your credit rating. Not unless you take out joint credit, such as utility bills, a joint loan, or a joint mortgage.
9. Applying for lots of credit products is a good thing.
If you apply for a lot of credit products in a short time, lenders might think you’re desperate for credit. This can make them reluctant to lend to you.
10. There’s no difference between withdrawing cash with a credit card and a debit card.
Withdrawing cash using a credit card often comes with a withdrawal fee and incurs interest straightaway — unless you have a credit card designed specifically for withdrawing cash. Usually, it’s best to stick with your debit card for withdrawals.