You Have To Pay Interest to Get A Good Credit Score
This myth is comes from the idea that without paying a lot of interest, the FICO scores have nothing to calculate from your history. It implies that carrying a bit of a balance on your credit cards all of the time is a good thing.
As has been reiterated several times already in this guide the FICO score is not designed to make a distinction between the balances you carry month to month and the balances that you pay off.
Although it is true that to get the highest FICO scores you need to have a mix of revolving accounts such as credit cards, and installment loans such as a mortgage or car loan, the delusion comes from the fact that most installment loans require paying interest.
However you don’t need to have the very highest score to score good credit. Any score over 720 or so is going to get you the best rates from the majority of lenders. You will have all the credit you need and then some.
If you area trying to improve a mediocre score, a small affordable installment loan can help provided you can pay it off on time. Otherwise there is absolutely no justification to for getting yourself into unnecessary debt and paying interest.