Most of us have a moment where we stop and wonder, “What can I do to improve my credit score?” It’s an excellent question, but it’s only half the issue. There are two parts to maintaining a good credit rating. They are the things you need to do and the things you should never do. Most consumers don’t have a clear base of knowledge about their credit. They take advice from the self proclaimed financial expert who pontificates around the water cooler at work or from the brother-in-law that knows a guy who knows another guy whose brother knows everything about money matters. Folks, this is a recipe for disaster.

Let’s examine some of the most common misconceptions people have regarding their credit scores.

1. Getting My Credit Score Will Hurt My Credit – This is simply not true. There are two types of inquiries to a person’s credit score, known as the FICO score. They are called soft inquiries and hard inquiries. Soft inquiries will never adversely affect your credit score. Hard Inquiries may or may not. Checking your own credit score is considered a soft inquiry and will not affect your credit score. A lender making an inquiry before issuing you credit constitutes a hard inquiry. If the lender disapproves your application for credit it will count against you.

2. Paying Off All My Debts Will Instantly Improve My Credit Score – Not only is this untrue, the exact opposite can occur. A large factor in your credit score is the difference between your available credit and how much you are actually using. Eliminating accounts reduces the amount of your total available credit. This gives more weight to your outstanding balances, which can negatively affect your credit score.

3. All Credit Reports Are Alike –Not true. The three main credit bureaus (Equifax, TransUnion and Experian) do not share all the same databases. It is not unusual to find one listing an entry the other two don’t have. Many people think as long as they get a clean bill of health from one of the three, everything is fine. Not so. A word to the wise; if you are checking your credit score because of something important like applying for your first mortgage, get your report from all three. This gives you a chance to fix errors before a lender sees them.

4. High Credit Card Limits Will Hurt My Credit Score – Not true. Having a lot of available credit can be a good thing. As I mentioned in number 2, the important thing is the balance between your available credit and what percentage of it you are using. If you have $100,000 of available credit and are $95,000 in debt you are in bad shape. On the other hand, if you have $100,000 of available credit and are carrying only $5000 of debt you are in an enviable position.

5. The Information on My Credit Report Cannot Be Changed. It Is Carved In Stone And I’m Totally Screwed – Again, not true and I wish I had a dollar for every time I’ve heard this one. You have a legal right to have inaccurate information removed from your credit report. This is the main reason to get your credit report from each of the big three credit bureaus. It is amazing how many things are wrong on these reports. Always correct errors on your credit report, unless of course, the error is in your favor.

Remember, there are two aspects to maintaining a good clean credit rating. You need to do things that will be good for your credit and not do things that will harm it.

I hope this myth busting helps.