Common Credit Card Myths

When it comes to credit card myths I think I have heard them all. It is amazing at times what people will hear and believe. Unfortunately, leaving credit card information to myths and urban legends isn't a great idea. So, let's take a look at the 7 most common credit card myths and separate the facts from the myths.

Myth 1 - If someone steals your credit card and charges up $5,000, you'll have to pay it all back.

I have spoken to many people over the years that believe they would be responsible for any fraudulent charges on their credit card should it be stolen. The facts give a different story.

Most all, with the exception of a very few obscure credit card companies, have a $50 limit that will be charged back to the credit card owner in the event of fraud, no matter how much was charged. In addition, there are several credit card companies that waive the fee if you file a report immediately.

Myth2 - You can only get a credit card with good credit.

This is a very common myth that many people believe is factual. The truth is, it is false. People with all types of credit can get a credit card.

It doesn't matter if you have A+ credit, or if you've just came out of a bankruptcy, you can find a credit card.

I will say that those who have good credit will be able to get credit cards with more favorable interest rates, but even those with poor credit can get a prepaid credit card at least. Paying off any balance on that card each month will also greatly improve your credit rating.

Myth 3 - Visa, is the best credit card to have.

Another common misconception. Both Visa and MasterCard are accepted evenly by all merchants in most all cases. In addition, Discover and American Express are also high on the acceptance list.

Myth 4 - Having a high credit limit is great for your credit.

While having a high credit card limit means you are trustworthy to the credit card issuer, it can also be a negative. Let me explain why. Many potential lenders look at unused credit as a negative because you could possibly go a lot deeper in debt if something were to happen to you, like a loss of your job, etc. It may not seem fair, but that is how lenders look at things.