That is obviously true, not false.
If you know that a password is no longer than, e.g., 10 characters, that narrows down the search domain by many, many orders of magnitude, in comparison with the case when you did not know this and you had to assume that the password could have been, e.g. 18 characters long.
If you test the possible passwords in increasing length, then knowing the length would not shorten much the search, but not knowing the length may prevent an attempt to search the password by brute force, as such an attempt would fail for longer passwords, so it is not worthwhile to do unless success is expected.
With modern hashing schemes, which require both a lot of time and a lot of memory for each tested password, even one extra character in the password can make the difference between a password that can be cracked in a useful time and one that would take too much time to crack, so knowing the length can be very important for the decision of an attacker of trying the exhaustive search approach.
Knowing the length is less important only for the users who are expected to choose easy to guess passwords, as there are much less of those than the possible random passwords.
