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| Photo Credit: Website Builder |
The best defense against making a credit blunder is to better educate yourself. These are things that our parents didn't tell us because credit has changed and morphed into something that can limit our "pursuit of happiness."
Myth #1: Avoid Using Credit Cards
FALSE! - This may be a good way to get rid of debt, but it's utter destruction to your credit score. Why? Because of the 5 factors that make up your credit score, one is how you use and manage your credit, a factor that makes up 30% of your score. That's 255 points! Use the cards every month for gas, groceries etc. but pay them off.
Myth #2: Consolidate Debt onto 1, Low-Interest Credit Card
FALSE! - Everyone gets the tempting credit offers to consolidate your debt onto one credit card but when you max out that card, your credit score will drop 60-100 points overnight! Do not consolidate your credit card debt UNLESS, the balance will be under 30% of the available limit.
Myth #3: It's Okay If You Go Over Your Credit Card Limit Because The Bank Authorized the Purchase
FALSE! - Going over limit, even if it's just by one dollar deals you a double penalty a 50 point lower score and usually a $39.00 fee.
