Credit Report – Great Additional Information!

I have a friend who is in the business of facilitating credit to clients (credit advisor) and he has these words of wisdom to share.

To Start here is a link to help a little with the topic of credit.

Here is a link with the 2 Major Canadian Reporting Agencies.
(I only use those 2 links as I have permission from the company)

Credit Reports are one of the most interesting topics to talk about as there is no 1 person with the same history or “fingerprint”.  I have been studying credit reports for many years now and find that a majority of people don’t know what their credit is like, or are unknowledgeable of what is in it. As I could talk on this topic for many hours (and many people don’t have many hours to stare at a single post), I will try to post in a brief manor.

First of all, I would like to say that, in my opinion, credit should be taught at a much younger age than it is being currently taught at (please enter age it is currently being taught at here___). (I personally think it is never actually taught! ~Vicky) I strongly believe that a person should frequently check their credit rating on both Canadian Agencies (Equifax and Transunion). A person’s credit history will not always be consistent on both agencies. Some lenders will use Equifax to pull bureaus and some will use Transunion.

I personally check mine monthly (maybe more) to tackle any errors that might come up. I find that tackling an error in the first 3o days is easier than approaching a company a year later to correct a mistake. If there is a mistake on a bureau it could take 90 days for the agency to correct this. If a person is in the middle of applying for credit (mortgage, car loan, LOC (line of credit), HELOC (home equity Line of credit), etc. the 90 days could be the difference between approval and decline. Credit takes a long time to build but can take 1 moment to put a person into a higher percentage bracket.

I can go into some specifics on a later post about credit but I will suggest a couple things to remember now:
1) credit cards- If you don’t have the means to pay it back within 21 days (grace period) then don’t put it on your credit card.
2) Car loans- a great idea to either build credit, or to maximize the use of your liquid $$ for other investments (instead of paying cash for your vehicle). Please remember: a vehicle is still and always will be a depreciating item.
3) Mortgage- obviously a great choice as property is still, in my opinion, the only appreciating asset.
4) LOC (line of credit-unsecured)- a great item to have especially if the interest rate borrowing is low. You can actually use a line of credit for other investments if the ROI (return on investment) is higher than the rate on the LOC. Also great for LARGE purchases such as home repairs that will build more equity into a home.
5) HELOC (home equity line of credit)- usually less interest rate then a LOC and can also be used for the same thing. Keep in mind that this loan is directly tied to your homes’ value and current mortgage balance.

Please keep in mind that the above is only my opinion. When I have some more time I will post some more opinions.

I think the information provided is great; I will definitely look into the second agency to see if there is any way I can get a free report as well. If I am able to, I will definitely update with the information needed. I also agree that credit should be taught to kids as credit has such a huge impact on every day life. We will all use credit in one way or another and very few (myself included!) have an understanding on how our credit rating is calculated and how this affects the rate at which we can get our mortgages or other types of loans. Thanks for sharing!

Did this week fly by for you as well? I hope you all have a wonderful weekend, and safe travels to the friends heading off to sunny destinations!

I need your help! As this is a new blog, please spread the word on Facebook and/or Twitter! Or email the link to a friend or family member! Thanks for the support!


2 Comments (+add yours?)

  1. hockeygrl87
    Jan 06, 2012 @ 22:51:06

    Love both posts about credit reports! Thx for the link. I wanted to get one done a couple months ago but have been lazy about it. Good reminder. I’m also thinking about applying to get a student loan (assuming that I am accepted into the program that I want), hoping to pay it off and boost my credit rating (I don’t know what it is… but it’s the perfectionist side of me coming through here), even though I can pay it straight out as cash. I’m treating it like I do with my credit card–reaping the benefits, but not a slave to it. I pay it off every month and get free stuff out of doing so; like being rewarded for doing a great job with managing my finances.

    What do you think? Should I apply for the student loan anyway or pay it off with my credit card and then pay THAT off.


    • Vicky Vo
      Jan 07, 2012 @ 02:41:56

      I think if you can get free money from the government, do it! The money that would otherwise go to tuition can be invested (or put into a savings account) until you finish school. Then you can pay off your loan after that.


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