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Credit Score Myths — What Does Not Affect Your Score

Written by: Kristy Welsh

Last Updated: September 25, 2017

Knowing your credit score allows you to make changes and improvements to your overall credit profile. But did you know, 42 percent of Americans fail to regularly check their score which is equivalent to a financial grade point average. As one senior director of Visa, Inc. puts it, "not checking your credit score at least once a year is like driving with your eyes closed, you are risking a financial collision."

Myths Surrounding Credit Scores

Your credit score impacts your ability to get a home loan to being hired for a job. But do you really know what does and does not affect your score? According to a study done by Visa, Inc., many Americans don't know what goes into determining a credit score. In the study, 60 percent of those surveyed thought employment history factored into their credit score and 17 percent thought gender was a factor. These people are wrong on both assumptions.

Below are the percentages of respondents who incorrectly thought these factors were included in determining their credit score:

  • Employment History: 60%
  • Interest Rates on Debt: 59%
  • Amount of Money in Savings Account: 53%
  • Your Age: 39%
  • Where You Live: 25%
  • Ethnicity: 22%
  • Ability to Speak English: 22%
  • Your Gender: 17%
  • Your Race: 16%

Factors Which Do Not Affect Your Credit Score

The reality is, the above mentioned factors do not have the slightest affect on your credit score. It would be illegal for Fair Issac to consider race, religion, birthplace, gender, or marital status when determining your credit score. According to myFICO.com, here is a list of what is not considered in your FICO score:

  • Your race, color, religion, national origin, sex and marital status.  U.S. law prohibits credit scoring from considering these facts, as well as any receipt of public assistance, or the exercise of any consumer right under the Consumer Credit Protection Act.
  • Your age.  Other types of scores may consider your age, but FICO scores don't.
  • Your salary, occupation, title, employer, date employed or employment history.  Lenders may consider this information, however, as may other types of scores.
  • Where you live.
  • Any interest rate being charged on a particular credit card or other account.
  • Any items reported as child/family support obligations or rental agreements.
  • Certain types of credit inquiries.  FICO does not count consumer-initiated inquiries, requests you have made for your credit report, in order to check it. It also does not count promotional inquiries, requests made by lenders in order to make you a pre-approved credit offer. Nor does it consider administrative inquiries,  requests made by lenders to review your account with them. Requests that are marked as coming from employers are not counted either.
  • Any information not found in your credit report.
  • Any information that is not proven to be predictive of future credit performance.
  • Whether or not you are participating in a credit counseling of any kind.

Now, we are not saying nobody cares about such things as your income or work history. A landlord or loan officer will likely want to know about your salary or employment history but it in no way affects your credit score.