What is a credit report? Your credit history is recorded in your credit report maintained by Canada’s three major credit-reporting agencies: Equifax Canada, TransUnion Canada and Northern Credit Bureaus Inc. A credit report is a “snapshot” of your credit history and is the primary tool lenders use to decide whether or not to give you credit.
What is a credit score? Your credit score is a judgment about your financial health. It indicates the risk you represent for lenders, and your profit potential, compared with other consumers. The higher your score, the lower the risk for the lender and/or the more profitable you will likely be as a customer.
Understanding your credit report. Some credit-reporting agencies report the lenders’ rating of each of your credit history items on a scale of 1 to 9. A rating of “1” means you pay your bills within 30 days of the due date. A rating of “9” means that you never pay your bills at all or that you have made a consumer debt repayment proposal to the lender. A letter will also appear in front of the number: for example, I2, O2, R2. The letter stands for the type of the credit you are using “I” refers to an installment loan, such as for a car loan, where you borrow money once and repay it in fixed amounts, on a regular basis, for a specific period of time until the loan is paid off.
“O” refers to open credit such as a line of credit, where you borrow money, as needed, up to a certain limit and the total balance is due at the end of each period. Student loans can also fall into this category because the money may not be owing until you are out of school.
“R” refers to revolving credit, on which you make regular payments in varying amounts depending on the balance of your account, and can then borrow more money up to your credit limit. Credit cards are revolving credit.
If you are like most Canadians you have mismanaged your credit either due to recklessness or due to circumstances beyond your control and for that reason have lost your trustworthiness to creditors, this translates to you not being able to qualify for many things like a Mortgage, a car loan, a student loan, rental of an apartment or even a job.
We know how you feel when you get denied for a loan over and over, the truth is that all hope is not lost. You can still rebound and get your good credit back so we have put together a FREE Credit counselling program for anyone who needs help, if you are disciplined enough and follow the program you will see tremendous result. How long it takes to fix your credit will depend on your situation and your level of commitment in implementing the different steps recommended in the program.
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