Credit scores attract more myths than almost any other financial topic. From well-meaning relatives to that colleague who considers themselves a financial expert, everyone has an opinion about how credit “really” works.
The problem is, most of these opinions are completely wrong. Here are the most persistent credit myths we hear, and what’s actually true.
Myth 1: “Checking my credit score will damage it”
This might be the most damaging myth out there, because it stops people from monitoring something that’s genuinely important to their financial health.
The reality: When you check your own credit score through apps like ClearScore, Credit Karma, or directly with credit agencies like Experian, Equifax, and TransUnion, it’s called a “soft search.” These don’t appear on your credit file and have absolutely zero impact on your score. You could check it every single day and it wouldn’t matter.
What does affect your score are “hard searches” – when you actually apply for credit and lenders do a full check. These are visible to other lenders, and too many in a short period can make you look desperate for money.
The bottom line: Check your credit score regularly. It’s free, it won’t hurt you, and it helps you spot problems early.
Myth 2: “I don’t need to worry about credit because I don’t borrow money”
This one catches out loads of people who think they’re being financially responsible by avoiding all forms of credit.
The reality: Your credit score affects way more than just loans. Want the latest iPhone on contract? That’s a credit check. Trying to rent a flat? Landlords often want to see your credit report. Some employers check credit as part of the hiring process, particularly for jobs involving money or security.
Having no credit history can be almost as problematic as having bad credit history. Lenders can’t assess your reliability if there’s no track record to examine. Make sure you’re registered on the electoral roll at your current address – it’s one of the simplest ways to prove your identity and address to lenders.
The bottom line: Even if you hate borrowing, your credit score still matters for modern life in London.
Myth 3: “Paying off debt early will hurt my credit score”
This myth keeps people paying unnecessary interest because they’re afraid of doing the sensible thing.
The reality: Paying off debt early generally helps your credit score, not hurts it. It reduces your credit utilisation ratio (how much of your available credit you’re using) and demonstrates that you can manage debt responsibly.
The only tiny caveat is that very long credit histories can be beneficial, so if you’re paying off your only form of credit, you might want to keep a small amount active. But this is splitting hairs – if you can afford to pay something off, do it.
The bottom line: Pay off debt as quickly as you reasonably can. Your credit score and your bank balance will both thank you.
Myth 4: “All credit scores are the same”
People often get confused when they see different scores on different apps and assume something’s wrong.
The reality: There are three main credit agencies in the UK (Experian, Equifax, and TransUnion), and they all use different scoring systems. Experian scores go up to 999, Equifax goes to 700, and TransUnion goes to 710. They also don’t all have identical information about you.
Different lenders use different agencies, so your score with one might be more relevant for certain applications than others.
The bottom line: Don’t panic if your scores vary between agencies – this is completely normal.
Myth 5: “Credit repair companies can fix my credit instantly”
The rise of “credit repair” services has created the myth that credit problems can be solved quickly for a fee.
The reality: Legitimate negative information stays on your credit file for six years in the UK. No company can magically remove accurate information, regardless of what they claim or charge.
What these companies often do is dispute everything on your file, hoping some items get removed during the investigation process. You can do this yourself for free if there are genuine errors.
The bottom line: Building good credit takes time and consistent positive behaviour. There are no legitimate shortcuts.
Myth 6: “Closing old credit cards will improve my score”
This seems logical – fewer cards, less temptation, better credit, right?
The reality: Closing old credit cards often hurts your score in two ways. First, it reduces your total available credit, which can increase your credit utilisation ratio. Second, it can shorten your average credit history length.
If you’re worried about temptation, cut up the card but leave the account open. If there’s an annual fee, then fair enough – close it. But otherwise, old cards with good payment histories are generally worth keeping.
The bottom line: Your oldest credit card is often your most valuable for credit scoring purposes.
Myth 7: “My partner’s credit score affects mine”
This causes unnecessary worry in relationships and sometimes stops people from making sensible financial decisions together.
The reality: Your credit scores are completely separate unless you have joint financial products like a shared mortgage, loan, or current account. These create a “financial association” between you, but your individual scores remain your own.
Your partner’s debt doesn’t appear on your credit file, and their missed payments don’t directly affect your score.
The bottom line: You’re only financially linked for products you actually share. Getting married doesn’t automatically merge your credit files.
Myth 8: “I need perfect credit to get approved for anything”
This myth stops people from applying for things they’d actually be approved for, and creates unnecessary anxiety about minor credit imperfections.
The reality: Different lenders have different criteria, and most don’t require perfect credit. At London Mutual Credit Union, we regularly help people who’ve been turned down elsewhere, because we look at your whole financial picture rather than just your credit score.
Even high street lenders have products designed for people with less-than-perfect credit, though usually at higher rates.
The bottom line: Don’t let an imperfect credit score stop you from applying for financial products you need. The worst they can say is no.
The truth about credit scores
Here’s what actually matters: credit scores are simply a way for companies to quickly assess financial risk based on your past behaviour with money. They’re not a judgment of your worth as a person, and they’re not permanent.
The fundamentals of good credit are pretty straightforward – pay your bills on time, don’t borrow more than you can afford, and keep an eye on your credit report to make sure everything’s accurate.
At London Mutual Credit Union, we’ve always believed that people are more than their credit scores. That’s why we assess every loan application individually, looking at your actual financial situation rather than just relying on automated decisions.
Whether your credit is perfect or patchy, what matters most is building sustainable financial habits that work for your life. Good credit follows naturally from good financial behaviour, but it shouldn’t be the thing that keeps you awake at night.
