6 factors that don’t affect your credit score

Category: Credit

Couple Figuring out Finances

There are so many different things that will affect your credit score, that it can be difficult to know what factors actually don’t have an impact on credit rating. In fact, many consumers are often surprised—whether it’s a huge relief or a bit of disappointment—to learn that some of the following actually have no effect on credit score whatsoever:

Soft credit inquiries

A lot of people think that any credit report pull will affect their credit score and cause it to go down, but this is not the case. Only hard credit inquiries will negatively affect your credit score, and this happens when you apply for lines of credit, such as a loan or credit report. But soft credit inquiries—for example, applying for a job that requires a background check, or just pulling your own credit report to check your score—won’t affect your credit.

Timely utility bills

Paying your utility bills on time will keep your credit score from dropping, and not to mention, will also keep your lights on. Unfortunately, as unfair as it seems, utility bill companies rarely report favorable payment activity to the credit bureaus. So while there are quite a few benefits to making sure these bills are paid on time, they won’t do anything to help your credit score.

Your income

Did you just get a raise, or did you recently have to settle for a new job with a pay cut? Whether your annual salary is on the higher or the lower end, it won’t affect your credit score one way or the other.

Interest rates

If you qualify for a low interest rate, it’s likely that you have good credit—or if you’re only approved at a high interest rate, there’s a possibility that you might have credit that’s not so great, or just being established for the first time. While your credit score can certainly have an influence on the interest rates you receive, it doesn’t affect you the other way around. So if you open up a store credit card in order to take advantage of some enticing promotion, there’s a good chance you’ll get stuck with a high APR—regardless of your credit. However, that high APR won’t influence your credit score and cause it to drop.

Credit counseling

Many people turn to credit counseling as a financial solution, whether they need help managing debt or they want to file for bankruptcy. Although being in debt and filing for bankruptcy will affect credit, you won’t have to worry about credit counseling on its own affecting your credit score one way or another, although it might show up on your credit report.

Jail time

A lot of background checks include both criminal background checks and credit report pulls—for example, if you’re applying for a job and or for an apartment. Because these things tend to go hand-in-hand, some people think that if they were ever arrested, it will affect their credit score. Although it may stay on their record, it doesn’t change your credit score.

Do you need money to eliminate debts and catch up on bills? Contact Peachtree Financial Solutions today if you’re receiving long-term annuity payments and find out how you can sell future payments for a lump sum of cash.

Nothing above is meant to provide financial, tax, or legal advice. You should meet with appropriate professionals for such services.

Tags: credit counseling, credit score, interest rates, monthly expenses, utility bills

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