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Financial Friday #68: 10 Need-to-Know Fast Facts About Credit Scores

Friday, June 25, 2021   /   by Mario Daniel Sconza

Financial Friday #68: 10 Need-to-Know Fast Facts About Credit Scores

10 Need-to-Know Fast Facts About Credit Scores

(2-minute read)

 

  1. Equifax and TransUnion are the two credit-reporting agencies in Canada and your credit score will vary between the two. Lenders may check one or both agencies when you apply for credit.

  2. You can get a free credit report (not your credit score) directly from Equifax or TransUnion once per year. Your credit score is calculated based on the data in this report. Some financial institutions offer customers their credit score for free, or you can sign up with one of the many companies that provide credit scores online.

  3. Credit scores range between 300 and 900 with the Canadian average being 650.

  4. Your credit score is used for a lot more than just borrowing money; insurance companies, mobile phone providers, car leasing companies, landlords and employers may all require your credit score to make decisions.

  5. Five factors affect your credit score: length of credit history, credit utilization or how much of your limit you have used, the mix/types of credit you hold, the frequency you apply for credit, your payment history.

  6. Mistakes and omissions are not uncommon and is a good idea to check the details of your credit report. Both agencies have a process to report errors and get them corrected.

  7. Credit scores of 700+ are considered "good" and offer a higher chance of loan approval, greater borrowing limits, and lower or “preferred” interest rates and insurance premiums.

  8. Credit scores are continuously evaluated and adjusted. If you have “errored” in your past, the damage is not permanent! Your score can be raised/rebuilt by using credit responsibly (see #10).

  9. Checking your credit score regularly is a good idea and will help detect errors, monitor improvements, and identify fraud. This is a “soft” enquiry and will not affect your score.

  10. To increase your credit score: make payments on time, pay the full amount owing, use 35% or less of your available credit, hold a variety of credit types, apply for new credit sparingly.

 

If this list piqued your interest and you want to learn more, why not join financial coach and credit score expert Alanna Abramsky in next week’s webinar as she tells you everything you need to know about credit scores and managing debt.

 

No time for a webinar? Then check out Enriched Academy Co-Founder Kevin Cochran on YouTube as he explains credit scores in just over three minutes.


Resources

 

Which housing markets will ride-out interest rate hikes?

Overall, home prices in Canada are frothing. But local factors are at play and some cities would be hit hard if expected interest rate hikes materialize, while others would retain their current value much better. Which ones are which?

 

Simple ways to save like a billionaire

Warren Buffett is worth around $100 billion... but is never beyond saving a few bucks! Chances are you make less and spend more, so it's time to take 2 minutes and check out a few of his practical, money-saving ways that you could start using today.

 

10 Money sabotaging emotions

Emotions play a huge role in financial decision making and not often in a good way. A longer read (you'll need 7 minutes) that will leave you saying, "I've done that," but it also tells you how to reframe things and learn not to do it again.

 

Canadians have a saving problem... or is it a spending problem?

Savings rates jumped during the pandemic, but as spending opportunities come back into play we may once again struggle to save money. This article is 2-year's old but has never been so relevant if you are trying to put some money away.

 

Just "getting-by" on $100K a year.... Oh Henry!

Rising home prices, taxes, slow wage growth and student loans are hitting HENRYS (high earning not yet rich) hard. Are they victims of circumstance, or is it their affluent lifestyle that turns $100K into a paycheque-to-paycheque existence?

eXp Realty of Canada
Mario Daniel Sconza
4711 Yonge St 10th Floor
Toronto, ON M2N6K8
416-230-3476

Information is provided exclusively for consumers’ personal use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. Data is deemed reliable, but is not guaranteed accurate by the MLS®.
Information is provided exclusively for consumers’ personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. Data is deemed reliable, but is not guaranteed accurate by the MLS®. Copyright 2021 Last Updated October 19, 2021
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