Five Credit Score Myths | OkCarz

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How can you tell if you have a good credit score? 

When you’re looking to buy a new car, figuring out your finances can be difficult. One of the hardest parts of learning about finance is going through all of the conflicting advice that people might give you. Unless you spend a lot of time with financial geniuses, it is possible that the advice your friends and family give you isn’t really true, especially when it comes to your credit score.  

There are many discrepancies when it comes to what people believe about their credit score. While some of these myths don’t really do much harm, some of them can be detrimental to your financial future.  

[Related: Work your way into a new Toyota with OkCarz!]

You shouldn’t check your credit score 

Checking your credit won’t hurt your score, and knowing what your score is can help you figure out if there is something amiss if it drops significantly without you having done anything that might have affected your score. When you check your score, it counts as a soft inquiry, which won’t damage your credit.

 Some debt is good for your credit 

Technically speaking, you build credit through debt. Some think that when you’re using a credit card, you need to carry over a balance from month to month, but all it does is accumulate interest. Most experts suggest paying off your balance in full every month to keep a good credit score.  

a pile of credit cards

Maxing out your cards is alright 

This is definitely not the case. You should spend 30% of your limit or less on your credit cards. If you have more than one credit card, and one is maxed out, the other two can help counteract the first one, or they can put you in more trouble.  

 You only need one type of credit

If you have a student loan, mortgage, or car loan that you always pay on time, you probably have a decent or good score. However, if that loan is the only one you have, you aren’t realizing your full potential. A mix of revolving debt and installment loans is important.  

No matter what your credit score is, you can visit OkCarz to learn more about financing for a vehicle. It is easy to apply for preapproval online, and you can even view the inventory available at the dealership.  

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