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Thursday April 2, 2020

updated - April 2, 2020 Thursday EDT

Demystifying Canadian Credit Bureaus: Calculating Your Credit Score

Mar 23, 2020 03:05 PM EDT | By Staff Reporter
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Demystifying Canadian Credit Bureaus: Calculating Your Credit Score
(Photo : Demystifying Canadian Credit Bureaus: Calculating Your Credit Score)

From buying a car or house to even applying for a job, our credit can follow us around to a lot of places. Many don't quite grasp how important it is in our daily lives.

The Canadian Credit Bureaus run the standards for how credit works and the various rules that govern it all. To get an idea of what your credit score is and how it affects you, you should come to grips with these rules.

That's where we come in. Today we have all the questions and details that can relate to your credit score, and even how you can improve it! Let's dive in!

Understanding the Canadian Credit Bureaus

The Canadian Credit Bureaus use a credit score as a means to track a wide variety of personal information. This gives anyone an easy read on your record, noting your ability to operate with loans and other major responsibilities.

1. What Is a Credit Score?

A credit score is a crafted number, ranging from 300 to 900, that rises and falls due to a number of factors based on your financial history. 

A credit score, and the Bureau in general, keep many records on each citizen. Your identification number, age, marital status, social insurance number, bank records, and payment history are all kept within this file. 

2. What Affects My Credit Score?

There are a few items that affect your credit score, both in positive and negative ways.

Your payment history is the biggest one. Delinquencies on your payments give you a big negative hit, but frequent payments give you a steady positive bonus. 

Hitting your credit limit can ding your credit score while staying under it is a great way to earn some positive points. If you have no need for credit at the time, avoid inquiries, as they can hit your credit score.

A long and healthy history of credit accounts is a good thing. Having variety in your credit accounts is also a great sign for your credit. Having too many accounts, though, is a big negative. Even worse if they have unpaid balances.

3. What Does a Low Credit Rating Affect?

Having a bad credit rating often ruins your chances to get loans. This is the biggest effect on your life. A credit score below 650 often leaves you with little loan options.

Your credit score can even affect your ability to rent a house, apartment, or even car. Your credit score is a show of how well you pay things back, so renters may be iffy on renting to someone with missed payments.

Jobs can also sometimes check your credit score. It is a solid show of past responsibility, which is a common quality needed for new employees.

4. How Can I Fix a Low Credit Rating?

How do you fix all of this? There are still loans for bad credit. You can often use this boost in money to pay off outstanding bills, bumping up your credit score. 

Even small diligence to make steady payments can be better than nothing. 

Improving Yourself for Better Business and Better Life

With a better grip on the ideas behind the Canadian Credit Bureaus, you can come to terms with your credit and what kind of control you have over it. You have a lot of options to turn your credit score into the powerful tool it should be!

Good information is the key to improving yourself, whether it be business trends or reviews of the latest new tech. Keeping yourself informed is key and our other articles will do a great job of that. Check them out today!

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