bad credit home loan

The 4 Untold Truths About Credit Scores

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Who said that credit scores should only be checked when you want to apply for a bad credit auto loan? The truth is, if you are a credit card holder, you must review your credit report and score at least once a year. Find out other facts you might not know including what impacts your credit score.

  • Your employer must not check your credit scores

Ethically, employers are not allowed to use credit scores when recruiting job candidates. It is against the law to do that. The only thing they can use is the credit report but not the credit scores. The reason they need your credit history is to verify your integrity especially if you are have applied for a job in the financial sector. They might need to know how you are managing your bad credit home loan.

  • Do not close your credit card to improve credit score

Some people think that closing a credit card account can save your credit status which is very wrong. Such activity only hurts the scores especially when you are closing with a balance. It is better off to leave your account open particularly when it is in a good position so you can increase the odds of attaining higher credit scores.

  • Your bank account balances have nothing to do with credit scores

Your bank account might be flooding with lots of money, but you can still have bad credit. These balances are never used to determine your credit scores. Higher amounts of money in your bank account can help you adopt good saving habits, but if you are not using the money to pay bad credit mortgage on time, you might end up with poor credit scores.

  • Paying collection accounts doesn’t have an immediate effect on credit scores

It is true that it might save your credit score in the long-term but do not expect the score to improve overnight. A collection account remains on the credit report until the reporting time ends. However, this doesn’t apply to anything below $100 with the modern scoring models.

It is very important for you to verify your credit health periodically so you can monitor your finances effectively.