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Since 1952, D. & A. MacLeod Company Ltd.
Your credit score is one of the most important financial factors. Some people are pleased with their credit scores and others are disappointed. No matter where you find yourself, the question remains: how can I improve my credit score? The team from D. & A. MacLeod Company Ltd. has compiled the following tips that can help you take control of your credit and move toward achieving a higher credit rating. With locations across Ontario, you’re never far from sound financial advice.
1. Research yourself. Call the credit bureau Equifax® at 1-800-465-7166 or visit their website to get your free credit report before you even apply for credit. Knowing what your credit report says before applying for credit will help you maintain or improve your own credit score.
2. Pay your bills on time. This step sounds simple, but waiting to pay until reminders are sent has a negative effect on your credit report. Every day you’re late on a payment can lower your credit score. Note that even if you make a late payment in full, it can still negatively affect your score. Future creditors will be weary of applicants with a history of late payments.
3. Show stability in your employment and residence history. Many creditors like to see applicants who have remained at a consistent address or employer for at least one year. It goes without saying that creditors want applicants with a stable source of income. If your payments go into arrears, they’d also like to know where you live.
4. Start small and stay within your budget. If you haven’t established a credit history, don’t apply for a big loan, mortgage or line of credit. You’ll have more success in getting an RRSP loan and paying it off within a year. That’s a win/win situation.
5. Consider applying for a secured credit card. You deposit a pre-determined amount as collateral and then you’re ready to go. These funds are not used in place of payment, they are just held in the event of a default. Check with your financial institution to get more info on the secured credit cards they offer.
6. Establish an emergency fund. Imagine losing your job, becoming ill or suffering a serious accident. How will you make the rent? Experts recommend establishing an emergency fund that has enough money for two months of household bills and expenses. Emergencies strike without warning, so being prepared is one of the most prudent financial decisions you can make.
7. Stick to just one credit card. By limiting your purchases to a single card, you’ll be able to track your spending more easily. You’ll also build more history with a single creditor. The other thing to consider is keeping your debt load manageable. It’s easy to be confused regarding how much you owe when your debit is split between several creditors.
8. Don’t hide the problem. If you find yourself in uncertain financial waters and unable to pay the debts you’ve accrued, don’t try to hide from the problem. Contact your creditors to tell them why you’re falling behind in your payments and that you have every intention of paying your debts, but may need some leeway. If you are unable to pay your monthly bills, contact a licensed insolvency trustee in your area. They will review all of your options with you and help you make an informed decision.
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