Credit scores can be full of surprises! Here are some lesser-known facts about credit scores:

1. Multiple Scores Exist

• You don’t have just one credit score. Different scoring models, like FICO and VantageScore, use distinct criteria, leading to variations in your score. Even within the same model, lenders may use tailored versions specific to their needs.

2. Soft Inquiries Don’t Impact Your Score

• Checking your own credit report or applying for pre-qualified offers are considered “soft inquiries” and won’t hurt your score. Only “hard inquiries,” triggered by formal credit applications, might lower your score.

3. Utilization Matters More Than Total Debt

• Credit utilization ratio (the percentage of available credit you’re using) heavily influences your score. Even if you have a low overall debt, maxing out a single credit card can hurt your score.

4. Closed Accounts Can Affect Your Score

• Closing old credit accounts might reduce your score because it can lower your credit history length and available credit, affecting utilization ratios.

5. Medical Debt is Weighed Differently

• Medical debt is often treated more leniently in scoring models. Some scores disregard paid medical collections entirely, and newer FICO models prioritize other debts over unpaid medical bills.

6. Utility and Rent Payments May Count

• Traditionally, utility and rent payments didn’t factor into credit scores, but programs like Experian Boost and some VantageScore models now allow such data to improve your score.

7. Good Behavior Takes Time to Reflect

• Improvements in paying off debt or reducing utilization may not reflect on your score immediately. Credit bureaus update their information monthly or less frequently.

8. The Myth of “Joint Credit Scores”

• Credit scores are always individual. Even for joint accounts, each person has their own score, influenced by their credit behavior.

9. You Can Have a “Thin File”

• If you lack enough credit history, you might have a thin credit file, making it harder to generate a score. This often happens to young adults or those who primarily use cash.

10. Having No Debt Doesn’t Guarantee a High Score

• A good credit score requires a history of managing debt responsibly. Without any credit accounts, there’s little data for scoring models to evaluate.

11. Negative Information Fades Over Time

• Most negative marks, like late payments or collections, drop off your report after 7 years. Bankruptcies may last longer, but their impact diminishes over time.

12. Your Income Doesn’t Affect Your Score

• Credit scores are based on your credit history, not your income. However, lenders may consider income separately when evaluating creditworthiness.

13. Credit Scores May Affect More Than Loans

• Employers, landlords, and insurance companies might use your credit report (but not your score) to assess risk or responsibility.

14. Overpaying Won’t Boost Your Score

• Paying more than the minimum is great for reducing debt and avoiding interest, but it doesn’t provide extra credit score benefits beyond demonstrating on-time payments.

15. Authorized Users Can Benefit

• Being an authorized user on someone else’s account can help you build credit, provided the primary account holder manages the account responsibly.

16. Old Debts Aren’t Automatically Removed

• Paying off an old debt doesn’t remove it from your credit report—it just updates the status. Positive credit behavior takes time to overshadow past issues.