9 myths about what affects your credit score


Credit reports are affected by financial data, not correlating factors. Image: Flickr / rentvine / CC-BY-SA

Credit scores can feel like a mystery at times, with a huge number of factors. A recent survey, however, found that there are nine factors that some erroneously believe affect credit score.

Employment history

According to the Visa-funded survey, almost 60 percent of people believe that employment history has a direct effect on their credit score. Employment history is not a factor in any one of the three credit scores.

Debt interest rates

Almost as many, 58.7 percent of people, believe that the interest rate of debt has an impact on credit score. High interest rate debt does not directly affect credit score. High-interest debt is more difficult to pay and therefore may result in late payments. A good credit score often also means an individual qualifies for lower interest rates, but the effect does not run both directions.

Amount of assets or savings

About 53 percent of people believe that assets or savings affect credit. Credit rating agencies do not have access to information on the balance of your bank accounts. Only the existence of asset accounts is reported to credit agencies.


More than 38 percent of individuals believe that age has an effect on credit score. Age is not considered a factor, but length of credit accounts and payment history are both considered. Usually, this means that being older means a better chance at a better credit score.


More than 25 percent of people believe the area where you live has an effect on credit score. The place you live has no impact on the score that any of the three credit reporting agencies calculate.

National Origin

An individual’s national origin has no effect on official credit scores, according to all three major credit reporting agencies.

Ability to speak English

A person’s ability to speak English has no direct effect on credit score. Because credit scores are numerical calculations, English literacy cannot be factored in. English literacy does, however, have an effect on financial literacy, which does have a correlation to credit scores.

Gender and Race

Though 17 percent of people believe gender has an impact on credit score and 15 percent believe race does, this is not true. Gender and race have correlations to credit scores, but none of the three major credit reporting agencies take into account these factors.


PR Newswire
MSN Money

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