One common misconception among consumers is that any debt on your credit report is bad, which is not entirely true. Good debt – debt that you handled well by making on-time payments – is good for your credit score because it shows that you are a reliable borrower. This is especially true if it’s old debt, because it extends your credit history. So don’t call the reporting agency to remove that car loan from your credit report as soon as you pay off the vehicle. Leave old debt and good accounts on your credit history for as long as possible. This is also why you should keep your oldest credit cards active, even if you don’t use them very often. Cancelling a credit card that you’ve had for a long time will shorten your credit history, which could negatively impact your overall credit score.
The top person of that organization is Ronald J. Schaaf, president and CEO.
On a page titled “Credit Myths and Misconceptions,” Transunion, a consumer reporting agency, questionably states
It helps to close old accounts.
This credit myth advocates closing old and inactive accounts to hike up your score. However, this might inadvertently have the opposite affect[SIC] and lower your credit score because now the credit history appears shorter. If you don’t trust yourself to put a card away in a safe place and not use it, then consider canceling newer accounts.
That passage contains, at least, if not one of fact, a grammatical error. #myth8
FROM: Greg Fisher, creditscoring.com
TO: Donna Hoppenjan, president & CEO, Mound City Bank (#n259442)
DATE: 2016-09-19
SUBJECT: credit score, closing; Mound City Bank, president; Transunion #1411s
See this message and your response at https://blog.creditscoring.com/?p=5570 [this page].
I am with the media, am on a deadline (I set it; it is today) and I am writing about you. #1411s
This is the second item in a listicle titled “President’s Message” that you wrote for Mound City Bank:
Don’t Avoid All Debt
One common misconception among consumers is that any debt on your credit report is bad, which is not entirely true. Good debt – debt that you handled well by making on-time payments – is good for your credit score because it shows that you are a reliable borrower. This is especially true if it’s old debt, because it extends your credit history. So don’t call the reporting agency to remove that car loan from your credit report as soon as you pay off the vehicle. Leave old debt and good accounts on your credit history for as long as possible. This is also why you should keep your oldest credit cards active, even if you don’t use them very often. Cancelling a credit card that you’ve had for a long time will shorten your credit history, which could negatively impact your overall credit score.
A wild ride down a rabbit hole in New Jersey, the expert meets the dean of dating disasters and that (you know what).
Jersey
nj.com (aka the Star-Ledger) publishes a letter from a reader, one “Harry in Basking Ridge,” who says he has a credit score that would be outrageously high on one score’s scale. He got it by applying for a credit card (an important point). But, he wants to know, essentially, why certain things “adversely” affect his score, and why the system could see his credit file as negative.
Here’s the thing: In theory, all credit scores are all negative, unless perfect. And, they all come with reasons that the score is not higher. The only other non-negative possibility is Dave Ramsey‘s oft-repeated misinformation piece: No score due to lack of, or insufficient, credit history (just not enough data to go on to even calculate a score).
Reporters will be reporters, so the scribe with the by-line plows right in without getting clarification. Along for the ride is another willing quotable person as the newspaper reporter gives a wild explanation considering a multitude of fun facts, possibilities and speculations–about FICO scores, another score brand, a home equity line of credit, a personal line of credit, dubious advice about the proportion of balances to credit limits on revolving accounts and even mistaken identity.
Then, it goes off the rails with a comment about “default issues.”
Harry, that’s probably insulting, so a let’s talk.
While we’re waiting for him to make contact, consider a deeper implication of his scenario. Recent credit score disclosures, required by law, leave much to the imagination. One might say “Scores range from a low of 300 to a high of 850,” but what credit score it refers to is anybody’s guess.
Some disclosures say, “Your credit score ranks higher than [x] percent of U.S. consumers.” What the reader’s disclosure said in that regard is a mystery.
But, in a very peculiar case, another publication by the same company touched on the issue without even knowing it. If only…
Dating (again)
Out of the disclosure rabbit hole (for now), we bravely head into the Fox hole known as dating. The newspaper named the New York Times made it all the rage this year with a lovely little Christmas day tale, but unfortunately for the Times, the facts (and errors by the Times presented as facts) are unraveling.
Now, Experian (whose hanger-on-to the Queen chairman, himself, is a story) jumps in with its freecreditscore.com band brand and a survey (catnip for journalists; see LSU, below).
But who wouldn’t want to see the ever-ebullient Dean of Dating, chuckling Chucky-Chuck Woolery, again?! He’s the expert on love, and John Ulzheimer is the expert on credit scores. Take a look, and come back in 2 and 2.
Of all the Chucks, this guy is, well, one of them (because the best still rocks (‘n rolls)).
The takeaway for industry: Conduct a survey and get press, but be careful what you wish for.
The takeaway for citizens–consumers of news/infotainment: Don’t believe a thing that freecreditscore.com (Experian) says, despite their funny lip-synching, loveable loser band commercials.
Fox in the FOX house
“A poor credit score can haunt you throughout adulthood, affecting your ability to rent an apartment, finance a car, buy a home or even land your dream job.” – some guy, yesterday, published on a Fox Television Stations website
So, here we are. After 5 years, we still get a bald-faced and unsupported false statement like that. It is horrible. Notice the now-you-see-it-now-you-don’t change regarding a Louisiana State University study on a Rupert Murdoch website, the honorable correction by another party and the myth of the decade, still, on government websites.
