Top 3 myths about credit cards.
We know that credit cards are a popular way to buy stuff today and pay for them later.
They’ve also been around for a long time, and some general misconceptions have come up about them over the years.
Here, we get into a few of the myths about credit cards. (You learn something new every day.)
Myth 1: Checking your credit score can negatively impact it.
When you check your credit score, it creates a soft hit on your credit report, which doesn’t negatively impact your score. However, applying for things like a credit card, loan or mortgage requires a hard hit, which can in fact have an impact on your score.
Tip: You can stay informed about your credit score for free with Credit Keeper¹ from Capital One. Interested in knowing why your credit score is important? We explain it in our blog, “What’s in a credit score?”.
Myth 2: Secured cards aren’t “real” credit cards.
Not true! A secured card works like any other credit card, except that security funds are required as collateral to show you’re committed to using your card responsibly. Account activity on a secured card is reported to the credit reporting agencies on a monthly basis, which is why it’s important to make your payments on time and stay below your credit limit. Positive credit behaviour is essential to building your credit score, and a secured card is a great first step.
Myth 3: Good credit happens overnight.
Sorry to disappoint, but that isn’t possible. Building your credit takes time and dedication. So start now! Sure, it won’t happen overnight, but being responsible with your credit card – staying under your limit and making your payments on time – is one of the best ways to build your credit score. The Guaranteed Mastercard® from Capital One is a great option if you’re looking to build or rebuild your credit, and we have some great resources here on Life & Credit to support your goals!
Learn more about how credit cards work, and get inspired about managing your finances.
* If Quick Check pre-approves a card, you can be 100% sure we’ll approve your application as long as:
a. There’s been no change in your credit file information, personal information or financial status from the time you receive your Quick Check results to the time you apply for one of our credit cards;
b. You’re at least the age of majority in the province or territory you live in;
c. Your application isn’t flagged for fraud prevention;
d. You don’t have an existing Capital One account; and
e. You haven’t applied for a Capital One account in the last 30 days or had an account with us that was not in good standing in the last year. In good standing means not past due, over limit, fraudulent, restricted, or part of a consumer credit counselling program or bankruptcy.
In some cases, we may not be able to open an account for you even though your application was approved. This can happen if we’re unable to verify your identity, or you don’t provide the required security funds if you’re approved for a Secured Mastercard®.
1 The credit score and report information by Credit Keeper is intended for educational purposes only. Lenders and other commercial users may use a different type of credit score and other information when making credit decisions.
Credit Keeper is a service offered by Capital One and is powered by credit information provided by TransUnion. Availability may vary depending on our ability to verify your identity and obtain your information from TransUnion. Credit Keeper might be unavailable to some Quebec residents.
TransUnion and associated names and logos are trademarks of TransUnion, LLC or an affiliate.