“Good credit score” is another one of those financial terms everyone knows they should have, but hardly anyone knows how to get. To simplify the concept, and help you learn the most important aspects of your credit score and how they affect your life, we’ll walk you through some common misconceptions about credit ratings.

Myth: Late payments every so often is no biggie.

Bottom-line is that you should try to always make payments on time. Delayed payments regularly will lower your credit score. When you signed on the dotted line for that loan or credit card, you made a promise that you’d pay the lender on time and you should always try to keep your end of the bargain. If you’re struggling with lending that you’ve taken on, your best bet is to book an appointment with a financial advisor and see if there is wiggle room somewhere or another solution.

Myth: It’s fine if I’m making minimum payments.

Yes and no. Making minimum payments satisfies the agreement between you and the lender, but making additional payments on top of the minimum payment is better for your overall credit score.

If you need to make minimum payments for a short amount of time, the impact won’t be as large as if you pay the minimum for years and years. The reason being is that it shows the lender that you may be having issues with cash flow. Now, there are times when money might be tight and you feel like there is no alternative to paying a minimum—that’s ok. But if you’re paying the minimum for a long time, just remember, there might be more options.

Myth: I have a lot of credit—that means I have a good credit score.

Well, no. What if you’re only making minimum payments? Or you can’t pay them at all? Having lots of credit could be a sign of potential debt, not good credit. Another thing is that holding onto a lot of credit could turn off a potential lender. The lender might think, what happens if they give you a mortgage and then you spend all that credit and now you can’t afford your mortgage payment? Having a good amount of credit, no more than you need is just as important as a good credit score.

Myth: If I check my credit score it’ll go down.

No, actually according to Equifax, you won’t get dinged if you check your credit score. In fact, they advise that you check it regularly to make sure everything seems accurate—it’s a good way to detect types of fraud like identity theft.

Then add hard pulls, the credit report pulled by a lender, does affect credit scores.

Myth: I misused credit before and now I won’t be able to get lending.

Good news, the negative information that impacts a credit score like late or delinquent payments only stays on a credit report for about 7 years. There are always ways to improve your credit score even if you’ve misused credit in the last 7 years. So, regardless of the past, the decisions you make now and the way you use credit today can help you tomorrow. And again, if you’re struggling with your payments book an appointment with a financial advisor.

Connect with a financial adviser from Coast Capital’s Lending Team to learn about which lending solutions are right for you.

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This article is provided for general information purposes only. It is not to be relied upon as financial, tax, or investment advice or guarantees about the future, nor should it be considered a recommendation to buy or sell. Information contained in this article, including information relating to interest rates, market conditions, tax rules, fees, and other investment factors are subject to change without notice and Coast Capital Savings Federal Credit Union is not responsible to update this information. All third party sources are believed to be accurate and reliable as of the date of publication and Coast Capital Savings Federal Credit Union does not guarantee accuracy or reliability of such sources. Readers should consult their own professional advisor for specific financial, investment, and/or tax advice tailored to their needs to ensure that individual circumstances are considered properly and action is taken based on the latest available information.