Like they say, "Knowledge is power."

Many times people either act on false information or fail to act because they didn't know what could be done to their benefit.

This is the case in many areas of life, but on the top of that list is money. And in the money category, you will find lots of misinformation about credit.

There is so much to talk about on the topic of credit myths that an entire book could be dedicated to it.

Let us start with the granddaddy of all credit myths.

Myth 1: If I cosign a loan for my friend, it has no affect on my credit.

Fact: When you cosign a loan, it's like you took the loan on your own! It may be true that your friend is the first one responsible for the loan, however, if they default, it's completely your problem.

Myth 2: There's nothing I can do about it now. My credit is destroyed forever!

Fact: As long as you work, starting today, to rebuild your credit, you'll eventually get it under control. Rebuilding your credit means: (1) Paying on time; (2) Looking for better credit options; and (3) Learning more about money and credit.

Myth 3: I'm a complete financial loser for getting myself into this mess.

Fact: It may be true that you're responsible for getting into debt, but that doesn't make you a loser. In fact, it may not be your fault at all. As long as you start working on becoming more knowledgeable when it comes to finances, you will ultimately find success in controlling your debt.

Myth 4: It's fine to give out my credit card number for identification as long as I don't authorize a charge.

Fact: NEVER give out your information as a form of identification. When it comes to giving out any personal information, be sure you know exactly with whom you're speaking. This is especially true with someone on the phone.

Myth 5: If I get in debt too deep, I can just file for bankruptcy protection.

Fact: The bankruptcy laws are changing to make it more difficult to eliminate all your debt in a bankruptcy, so you may end up paying much of it back anyway.

It will also be on your credit report for 10 years! Hey, if you have NO OTHER OPTIONS, then you should certainly investigate bankruptcy. However, it's much better to settle the debts if you can

Credit card companies want you to be in debt because it maximizes their profits. Credit is much more than a piece of plastic, and the resources in this booklet can help you become a more informed consumer.

Creditors report at all different times of the month, therefore your score can change whenever your credit report changes.

In order to understand why many credit myths aren't true, it's important to understand exactly what credit is in the first place.

Learn More Credit Myths and Facts If you get offers in the mail does this mean you afford more credit.