Most people do not fully understand how to improve their credit score, although it probably best represents their current financial health. A credit score can correspond to such data as who qualifies for a loan, at what interest rate, and at what credit limits. From lenders to landlords, insurers to potential employers, many entities can have access to your credit score. Consequently, it is essential for you to go over your credit score record regularly. This record can highlight such factors as whether your identity was stolen, are there any credit history errors present, and is your credit score improving over time.

Notably, the key to having a good credit score is paying your bills when they are due in addition to maintaining your available outstanding loan debt at a low level. The following are common credit score myths that you should be aware of:

Myth 1. Only a single credit score exists. There are 3 credit agencies, namely: Experian, Transunion and Equifax. Each credit agency has a formula for creating an individual score, so you will have 3 different credit scores, but those shouldn’t vary by more than 20 points from each other. You are entitled to one free report per year from each of these agencies. Other credit scores also exist for insurance companies and additional businesses.

Myth 2. Checking your own credit report will result in a lower score. There is no limit to how many times a credit score can be checked and a person requesting their own report will not affect their own score. However, when a financial institution inquires about your score, this is typically considered a “hard” inquiry, which results in the credit reporting agency addressing this as if you are applying for a new credit card or asking for a loan.

Myth 3. Shopping for the top credit rate will lower your credit score. This is typically explained to non-suspecting consumers in order to prevent them from comparison shopping for the best credit rates. The credit bureaus know that people will try to get multiple quotes and, therefore, consider these type inquiries made within a 14 day period to be a single inquiry. It is, however, important not to apply for multiple loans at once, such as for a new car loan or a credit card just prior to applying for a new mortgage, since that raises red flags for the credit agencies.

Myth 4. Age, gender, income, and race will impact your score. A simple and a big NO is the answer.

Myth 5. A dispute letter will take away a lower credit decision. Only errors on your credit report ought to be disputed. The credit agencies have 30 days to reply and are efficient at removing inaccurate data. If however, an agency rules against your claim, it is better to pay the bill, so it doesn’t affect your credit score, and file your grievance against the merchant in a small claims court. Otherwise, you will have to explain to future creditors why you have a lower score and hope for their understanding.

Myth 6 . Marriage will combine both partners’ reports. Credit accounts are either opened on an individual basis or collectively but marrying someone with a solid credit score isn’t going to improve your credit score.

Myth 7. Paying off your credit card balance every month will guarantee you a high score. It’s a good idea to, once in a while, pay a card over time. This indicates to the credit agencies that you know how to use credit responsibly. The optimal method is to utilize 10% – 20% of your available credit and pay all bills without delay. To see the best improvement in your credit score, you should pay a majority of your credit card debt a few days before the billing cycle ends and keep the 10-20% owed for a few days after your credit card invoice arrives.

There are numerous websites that provide services related to free credit scores. For instance, the website creditscorecowboy.com is intended to educate consumers with useful free credit report information to help them become creditworthy. The site offers credit news and an aggregate of free credit score services, as well as an identity theft service. It is a good idea to check your credit report on a quarterly basis by using this site. You will surely benefit from reading the posted information and learning from the aforementioned myths to reach and maintain a good credit score.