There’s a lot of information on the internet …Especially about credit. Unfortunately, not all of the advice you read online is true. Unless it’s coming from a trusted source, always make sure to fact check your information. In fact, let us help! Here are five of the most commonly believed credit myths you’ll see today!
Your Credit Report Includes Your Education History
The information contained in your credit report is strictly related to your debt and the situations in which you’ve borrowed money in the past. This includes any loan, credit card, bankruptcy request or tax lien that has been reported.
Other financial information, such as your investments, RRSP’s, savings accounts, etc. is not included in your credit report. This also means information regarding your gender, marital status, religion, and yes, your education is completely omitted.
Paying Cash for Everything Improves Your Credit Rating
Your credit score is calculated by gathering the information in your credit report and analyzing it with a formula used by the credit bureaus. In order for you to acquire credit, you need to establish a history of responsible borrowing.
When you pay with cash, creditors can’t document those transactions. Hence, no information is included in your credit report and thus no credit score can be calculated. If you want to improve your credit rating, you need to establish a history a history of timely bill payments and responsible borrowing behavior.
Credit Bureaus Share Your Information with Other Businesses
Canada has two major credit bureaus: Equifax and TransUnion. These two bureaus work independently of one another, and their jobs are to collect your debt information and record your borrowing behaviors. That’s it.
Equifax and TransUnion do not assign labels to your credit report. They also do not advise companies whether or not to lend to you. They simply provide your credit information to borrowers after you have given the borrowers consent to attain it. It is the lender that reviews the information that makes a decision about whether or not to loan you money.
Applying for a Car Loan in Woodbine, Ontario
Buying a new vehicle can be an intimidating process. Especially if you have bad credit or no credit. Maybe you’ve even read online that getting a car loan is impossible. We’re here to tell you that THAT is another myth!
At Woodbine Nissan, we believe in helping people with all types of credit, good or bad. If you’re unsure about something you read online or have a question regarding your credit score, give us a call. We’re more than happy to dispel the myths and give you truthful information when it comes to your credit score.