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Chapter 4. Credit Scoring Myths > Myth 5: You Don't Have to Use Credit to Get a...

Myth 5: You Don't Have to Use Credit to Get a Good Credit Score

Some people are so suspicious of credit that they advise giving up credit cards and living on a cash-only basis. They acknowledge that most people need mortgages and auto loans, but they feel the best way to impress a lender is by living a credit-free life.

Now that you know something about how credit scoring works, you can see the holes in this theory. The credit scoring formula is designed to judge how well you handle credit over time; if you have no credit, or you don't at least occasionally use the credit you have, the formula won't have enough information to make an assessment. You don't have to live in debt to get a decent score, but you do need to use credit.


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