Hey there, welcome to my credit sucks. The podcast where we dive deep into the wild world of credit, no gimmicks, just real talk with your credit coach, Rolando Castro from untangling credit myths to sharing real life stories. That'll have you nodding along and maybe even laughing out loud. We're here to demystify the credit game one episode at a time.
So whether you're itching to boost your score, navigate credit card chaos. Or just want to feel a little less alone in your credit struggles. You're in the right place. Let's turn those credit woes into wins together. Stay tuned for the latest tips, tricks, and tales on my credit sucks.
Hello, and welcome back to my credit sucks podcast. I am your host and credit expert, Rolando Castro, and on today's episode, which happens to be episode number two. three, I will be debunking the top 10 credit myths, which I'm certain a lot of you are going to get them wrong. So grab your pen and paper because class is in session.
All right. Myth number one, the credit agencies, or let's call them credit bureaus are government entities. And the answer is no, they are not government entities. They have nothing to do with the government. These are publicly owned companies. Myth number two. All three credit reports have the same information.
The answer is no. That is the reason why less than five percent of consumers that have credit scores will see the same credit score all across all three credit agencies. 95 percent of us We'll see a variation. And the reason is because not every account reported has to be reported to all three credit agencies.
Myth number three, prepaid cards help boost my credit score. The answer is no. The only card that is kind of like a prepaid because you do use your own money. Is a secured credit card that is the only card that's not a credit card that helps boost your credit score Because that is reported to all three credit agencies a prepaid card is not at least not yet myth number four The amount of money you make and have in the bank influences your credit score, oh, that's a tricky one because The more money you make, the more money you have in your bank, sort of lets us know that you are able to keep up with your payments.
So does it influence your credit score? Um, somewhat yes, but the answer is no. Okay, moving on to myth number five. Spouses have a joint credit report. So when two people get married, they become one. And a lot of people think just because they become one, so do their credit reports. And the answer is no. No matter how many times you get married your credit report will always belong to you And whether it's a great credit score or not solely depends on you It will never mesh now if you guys open a joint account Which you should never do other than maybe a mortgage If you guys open a joint account, then that account would be reported to both credit reports.
So be mindful Do not open any credit cards With your spouse myth number six This is a pretty cool one paying off a collection account removes it from my credit report And the reason why I say it's cool because I am excited the fact that you're gonna know the answer right now The answer is no paying off a collection account does not remove it from your credit report The only way paying off a collection account is removed is if you do what's called a pay for deletion.
That's where You pay the company and in exchange they'll delete it from your credit report, but it needs to be in writing Myth number seven closing accounts does not affect your credit score and that one is a tricky one Okay, because yes It does affect your credit score, but then again, it doesn't but let's let's for the sake of this show Let's say it does affect your credit score Okay, because it could be both ways it will affect your credit score if you close an account that has a balance it would affect your credit score if you close an account and Because you close that account you use that available credit limit your utilization ratio increases so only close accounts when Of course, they have a zero balance and you closing that account because you lose a credit limit It will not affect your utilization ratio So moving on myth number eight your credit score will be lower if you have a lot of debt Now what this myth is talking about is Not revolving debt installment debt like a mortgage So they just say you go out and hit the lottery and you well if you hit the lottery You wouldn't be buying anything on credit, but they just say you know You got a bonus at work or whatever the case may be you buy a five million dollar house and you finance it Having that 5 million loan on your credit report because it's a large debt will not affect your credit score.
The only type of debt that does affect your credit score if it's rolled over month to month is revolving debt, which we've discussed in episode two. Okay. Myth number nine. This is a pretty intense one. A divorce decree removes my liability from owing and paying the debt. Eeeesh. Now, you go to court, you get divorced, and for some of you, it might be the happiest day of your life, and for others, it might not.
But whatever the case may be, The judge tells one of the spouses, well, you have to pay these credit cards and tells the other spouse, you have to pay those credit cards. And one of them is like, screw you. I'm not going to pay it. I don't care about my credit, whatever. And then you check your credit one day and damn it.
Your ex wife or husband is not making their payments on the credit cards. And you thought, cause I have a divorce, I'm not liable for it anymore. That's not true. The moment you sign a promissory note, You owe that debt until it's paid off. So don't think for a second just because you got divorced and you're, you know, having the time of your life and you know, I'd have to pay that credit card in the morning.
You wake up one day and your credit sucks. All right, so no divorce decrees are not Uh something you can present to a creditor and say, okay, we'll remove my name from the debt. Nope It's not going to happen right myth number 10 adding myself a credit card as an authorized user and using the card I am still not liable for the debt and the answer is no now adding yourself As an authorized user and someone's credit card is one of the best ways you can increase your credit score.
If that credit card has a long history, low balance and perfect payment history, the moment you use that credit card, even if you just buy yourself a latte, a 10 latte, and the balance must have been 1500 at the time because you use the 10. Now you legally are buying to that credit card and you cannot remove yourself.
So when adding yourself to an authorized user credit card only do it for the sole purpose of inheriting that credit history Which would increase your credit score and increase your buying power Do not use the card. Those were the top 10 credit myths. How many did you get wrong? Please email me a contact that my credit sucks podcast or simply in the notes below, let me know how many you got right or how many you got wrong.
Hey, credit warrior. We've partnered with smart credit to bring you a special offer. For just one 99, get a seven day trial of top notch credit monitoring. It's crucial to monitor your credit to catch errors and prevent identity theft. Stay on top of your credit game and protect your financial future.
Click the link in the show notes and start your trial today. All
right, moving on in every episode, I like to share a success story. And we can all celebrate or a credit blunder, or someone just made a bad decision. And today it's not, it's neither, or it's just, it's a sad story. Okay. I had a customer, an older lady come to me and my team analyzed the credit report.
And the only thing that was wrong with the credit was two recent repossessions. So this lady looks like the type of person, you know, looking at her credit report, she has 30 plus positive accounts. So, you know, we asked what happened with those accounts. And he said, well, each of those repos belong to two of my kids.
I co signed for my older son. He was going to college. I got him a car and you know, he stopped making his payments and the car was repossessed. But meanwhile, uh, four months after co signing for my older son, I co signed for my younger son and he was making his payments on time. But the moment he found out that the older brother stopped making the payment.
For some reason this son stopped making the payments. I guess they're both taking the bus. I don't know go figure but two years later this lady tried to buy a car because her car broke down and Guess what? She walked into a dealership with the 580 fico score two recent repossessions And she was denied so someone referred it to us and Here's the sad part.
She asked the older son, son. I don't have a car. Will you please call sign for me? I need help and the oldest son said no. I can't do that for you. My credit is great and I Can't take the chance if you ruin it So she goes over to the second son who he too has great credit. And she asked him, son, would you help me co sign for a car?
You know, my car that I have is breaking down and it's on his last thread. And this is a single parent goes to work, pays all the bills and the kid. The youngest son said, no, mom, I'm not going to call sign for you either, because I got to protect my credit. I'm going to buy a house soon. So this lady came to us and you don't have any help.
I need to remove these repos from my credit report because I need to buy a car. Now there isn't much that we can do because these repos are two years old. So her, her only option is to just kind of wait it out or settle the debt. And. She doesn't have the money to settle them. Even if we were to obtain low settlements, it just wouldn't happen.
So my question to you is this, do you think these two kids made the right decision by not helping their mom and. Protecting their credit or do you think they owe it to their mom and they should have helped the mom now the mom She's an active client. We did a pro bono. We are not charging her to help her with her credit We're still trying to do whatever we can To help boost the score at least enough for her to qualify for a car My team spoke with her two weeks ago and the kids still have not co signed for her So, what do you think now if you were to ask me, I think these kids owe it to their mom And for one, they're not taking care of the debt.
They're not taking responsibility for the damage they cost. Not only to the mom relationship wise, but to their credit, these kids need to man up. They need to take care of their debt. And if they can't do that, the least they can do is call sign for the mom. But tell them, please, mom, don't screw up. My credit, like I screwed up yours.
So please let me know in the comments below what you think, whether these kids did right or whether these kids did wrong. Thank you so much. I hope you enjoyed the show. All good things must come to an end, but please do not forget to subscribe. Leave us a review and please follow us on Instagram and tick tock at my credit sucks.
Podcast. And like I always say, take care of yourself, your health, and your credit. God bless you.
To whoever may need this nugget of encouragement. Things will be all right. So put your word with you. I get it. The odds can stack back against the wall. But even considering such, know you'll stand firm. Sat and watched from the sidelines. Went too many times. Wicked games you play. Make me want to lose my mind.