Credit Problems / Bankruptcy

Credit ProblemsSometimes unfortunate situations come up that are out of your control. Job loss, divorce, injury or illness can all negatively impact your overall credit score. If your credit situation isn’t perfect and you don’t know where to start, I can help.

I have strategies to help improve and even heal your damaged or nonexistent credit. You may still be able to obtain a mortgage even if you’ve had a bankruptcy, consumer proposal or if your credit is bruised.

I have access to non-traditional lenders who offer financing solutions to individuals who have some credit challenges that cannot be addressed by the major financial institutions. Together we can work together to assess your situation and decide on the best way to move forward.

I don’t know what my credit score is

You can inquire about your own credit score with either Equifax or TransUnion. Both charge for their services, however a free report is available, but does not show your credit score. When you pull your own credit report it is considered a ‘soft’ hit and does not impact your rating. Too many inquiries can also hurt your credit rating. Knowing what is on your report is important.

What is a secured credit card?

A secured credit card is a credit card whereby you have secured a cash collateral deposit which becomes the limit for your account. Ensure that the secured credit card will report on your credit history. Unlike a debit/visa card which is virtually like a bank card that is directly linked to your bank account. Any purchases made are automatically debited from your bank account. These types of cards do not report to any credit agencies. Not every bank will offer a secured credit card and there are various minimums required as a deposit. Home Trust, People’s Trust and Capital One are some of the lenders offering secured credit cards that report to the credit bureaus.  Click  below to find out more:

Home Trust Secured Visa

People’s Trust Secured MasterCard

Capital One Guaranteed MasterCard

How to improve your credit score

Re-established credit

Improving your credit score takes time. If there is a delinquency that has been corrected but is not reflecting correctly on your report, get it corrected. If you have a low score you could:

1. Ensure you make your payments on time. If you cannot pay the full amount, at least make the minimum payment. Not every financial product will be counted or improve your credit score. However, if you miss payments and your account is sent to a collection agency, this can be included and will damage your credit score.

2. Use of available credit or credit utilization. The total amount of available credit you actally use, not your total credit limit is factored. Try to use less than 35% of your available credit.

3. The longer you have had an account open and used it reflects on the length of your credit history.

4. Too many inquiries can cause for concern. It can look like you are desperate for credit. ‘Hard hits’ are counted toward your credit score and are recorded as an inquiry. ‘Soft hits’ are inquiries that do not affect your score and only you can see these when you request your report. Shopping around for a mortgage or a car with in a 2-3 week period are related and usually combined and treated as a single inquiry.

5. Try to have a mix of credit products such as a credit card, loan, or line of credit. The minimum limit should be greater than $1000 and have them over a period of time.

For more information and tips on improving your credit score, visit the Financial Consumer Agency of Canada website.

Contact me for a confidential appointment to rebuild your credit today!