Your credit rating is a measure of your credit worthiness determined by your record of borrowing and repayment and is reflected by a ‘Beacon Score'.
Governed by provincial laws, there are several credit bureau agencies that track your history of how you handle debt. This information is gathered from financial institutions, retailers and other lenders. Most of your information, both good and bad, remains on your record for 7 years.
Here's how to build a good credit rating:
Pay your bills on time, especially credit cards
- Borrow only what you need and what you can afford (don't apply for every credit card offer that comes to you in the mail!)
- Pay off loans on time or sooner than scheduled
- In the event of any credit disputes, deal with them quickly, don't ignore them
As a consumer it is your right to know what your credit rating/beacon score is. You can be denied credit based on inaccurate or insufficient information that is reported to the various agencies so if you don't know what your rating is you may want to check it. You can get a copy of your credit report through one of the many credit bureaus such as Equifax or TransUnion for free or for a nominal charge.
Once you have received your report (after providing sufficient identification) you will need to review the information. If you notice any errors and can offer written proof then your file should be amended immediately. If you don't have written proof then the information that you are challenging may have a note added saying that it is ‘in dispute'.
Another remedy to explain any discrepancies or provide other comments is to make a ‘Consumer Statement' which is affixed to the bottom of your report. Unfortunately this statement will not alter your beacon score but could provide some insight to lenders who will be reviewing your file in the future.
If you have any questions or would like my assistance in reading your credit bureau once you have received it, please feel free to contact me.
Jerry Sims is a mortgage broker with Ambro & Associates Mortgage Consultants Ltd. with over 20 years of lending, banking and financial planning experience. A highly satisfied and loyal client base can attest to Jerry's knowledgeable, creative and caring service that rises above and beyond expectations. Jerry has worked at several financial institutions in the capacity of loans officer, branch manager and credit manager.
Please feel free to ask John for an endorsement if you would like to know more about my services.