Your Credit Score: How to Improve the 3-Digit Number That Shapes Your Financial Future, Fifth Edition

5. Credit-Scoring Myths

For most of credit scoring’s history, the vast majority of the people involved in lending decisions pretty much had to guess what hurt or helped a score. Creators of scoring formulas didn’t want to reveal much about how the models worked, for fear that competitors would steal their ideas or that consumers would figure out how to beat the system.

Fortunately, today we know a lot more about credit scoring—but not everybody has kept up with the latest intelligence. Some of the worst misinformation comes from self-styled experts who purport to know the inside scoop, but who actually promote outdated or downright false ideas about how credit scoring works. Acting on their bad advice can put your score and your finances at significant ...