Looking to give your credit score a lift? We’ll show you how to obtain your credit score, what it means, and how to get it into better shape.
Your credit report and your credit score are two different things, and your report does not include your score. Your credit score shows you how lenders will view your creditworthiness. You can obtain your credit score through an Equifax or TransUnion subscription. Also, many of Canada’s major banks allow you to access your credit score online for free through their online banking platforms; however, the credit score provided by your bank may not be your official credit score according to Equifax or TransUnion.
Credit Canada will also discuss your credit score when you book a free Credit Building counselling session with us. This can be extremely valuable for people with a low credit score and high debt, but who also have a steady source of income.
Credit reports are a record of your credit history, and they are maintained by credit bureaus, also known as credit reporting agencies. There are two credit reporting agencies in Canada – Equifax and TransUnion. You can get a free copy of your credit report once a year from each credit bureau, and it will not affect your credit score. Your credit report contains the following information (but again, it doesn’t include your credit score):
Each account shown on your credit report will have a rating, which reflects the type of credit and the current payment status of the account. The type of credit is indicated by a single letter and the payment status will be a number between 0 and 9. This scale is NOT linear - the numbers simply describe the current payment status.
The tables featured here explain the meaning behind each letter and number for a credit rating.
If you've ever used a credit card, have a cell phone plan or taken out a personal loan, then you've got a credit score.
Your credit score is calculated by credit bureaus that convert information on your credit report to a number based on a formula called the “FICO formula.” Your credit score will be a number between 300 and 900.
Here are the factors that make up your credit score and a percentage indicating how important they are when it comes to calculating your score.
Generally, a credit score approaching 700 or above is looked at favourably by lenders, meaning you probably won’t be turned down for credit or a loan, and the interest rate will likely be reasonable. If your credit score is 800 or above, you’re in excellent shape.
According to FICO, for people with “normal” credit profiles, payment history and credit already used make up 65% of your credit score.
For anyone who has had credit problems in the recent past, here's how you can start taking steps to rebuild your credit.
You may be looking for ways to improve your credit score fast, but it’s important to know that it can take some time and patience. However, to give your credit score a boost, you should remember to do (or start doing) each of the following:
There are a lot of myths and misunderstandings about credit reports. Our professionally certified Credit Counsellors will help you understand how credit reporting works and how you can improve your credit score.
Want to rebuild your credit? Take advantage of our FREE Credit Building Counselling sessions by filling out the form below.