Fix your bad credit report

Repairing your credit rating is within your reach. A bad mark on your credit report can remain there for 7 years, but taking charge of your credit rating can help restore it sooner.

1. Get a copy of your credit report. Find out what is on it. You cannot start addressing the problems if you don't know what they are.
2. Pay your bills: If a $200 debt on a old credit card is the only black mark on your credit report, save up $200, contact the credit card company, and arrange to make payment. Paying your debts is the most effective way to repair your credit record.
3. Consider you debt management options: A consumer proposal is an alternative to credit counselling and often costs less. A consumer proposal is a legal settlement which allows you to repay only a portion of your debts and still have them eliminated.

Strategies for a healthy credit rating:

1. Borrow fully secured money. Secured debts are those that are backed up by some sort of asset or guarantee. The most common examples are car loans or mortgages. If you don't pay, the creditor sells the "security". When applying for this type of loan, credit will generally be granted up to 75% of the value of the underlying security. A variation on this is to have someone co-sign or guarantee your debt. In this case, they will be granting credit to your co-signer, not you. If you repay the loan, your record will benefit. If you default, the co-signor will be required to pay.
2. Obtain a secured credit card. Placing a sum of money on deposit with a bank and pledging the money as security for the card does this. If you don't make your required payments, the bank will withdraw the money from your deposit and reduce your available credit accordingly.
3. Borrow for an RRSP. For some reason, banks view people with RRSPs differently. It demonstrates that you're looking towards your future. When you receive your tax refund, use the refund to repay the loan, thereby paying off the debt more quickly then you were required. This will cause a marked improvement in your report.
4. Borrow when you don't need to. Obtain a small line of credit. Use it to pay bills and then immediately pay off the line. Repeat this process and over time, it will have a marked improvement in your credit report.

The Best Advice:

Pay your bills on time. Don't bounce any cheques. Don't overdraw your account at the bank (even if you have overdraft protection). Show the credit system that you are a responsible money manager and that when you borrow money, it's because you want to, not because you have to. In this way you will repair your credit and avoid a bad credit report in the future.

What to do now?

If you are experiencing problems paying your debts call one of our offices, or email one of our trustees today.

We offer a free, no obligation consultation. One of our experts will personally review your situation and answer your questions.

Let us help you choose the correct solution to solve your money problems. Simply contact our team today.

Take charge. It IS possible to repair your bad credit

Strategies for a healthy credit rating:

The Best Advice:

What to do now?