If you know that your credit is damaged, you may be looking for a credit repair solution. Unfortunately, most credit issues cannot be immediately solved. It takes time and effort to significantly improve your credit standing. However, you can start the recovery process right now, and from the comfort of your own home.
Please be mindful of the fact that there are companies out there that make empty promises about "instant" credit fixes. While their offers may seem enticing, they may involve "solutions" that are unscrupulous or even illegal. If you are thinking of soliciting the services of any "credit repair" company, please contact your provincial or territorial government before signing a contract. It is wise to know the rules that govern these types of organizations so you can protect your rights.
DIY Credit Repair Solutions
Most individuals can solve their credit issues on their own. Yes, you will need to be motivated to devise a strategic plan that involves setting realistic goals, but repairing your credit is something that you can do for yourself.
- Request copies of your credit report. You may ask for a complimentary copy of your credit report from both Equifax and TransUnion once a year. And once you have your reports, you should carefully examine them for errors and items that look suspicious. If you find that your credit rating is unnecessarily low due to mistakes or fraudulent activity, you can dispute the inaccurate information and have your report(s) corrected.
When you're looking over your credit history, it is helpful to know a bit about how the information on your reports is organized. Every loan and line of credit that you've taken out over the past six years will be represented. You will see that each item is assigned a letter and a number. An "R" refers to revolving debt (or credit card debt), while an "I" stands for installment credit. The number (0-9) that follows the "R" or "I" is a rating for how well or poorly the account was handled. "0" indicates that an account is too new to rate, "1" means that the account is in good standing, and a "9" is given to delinquent accounts that have gone into collections.
- Get current with your bills. Tardy payments have a negative impact on your credit score, so bring your balances up to date and make sure that all future payments are made on time. Remember that even payments for services that don't normally show up on your credit report (such as your cellular phone) will be reported if they are late.
- Be cautious with your credit card use. If you are currently utilizing more than 30% of any line of credit, your credit rating has been reduced. Overusing credit is viewed as a sign that you are living above your income level. Also, maintaining high balances on high interest credit cards can cause you to rapidly accumulate debt. A wise plan of action would be to budget your income carefully so that you have extra money every month to quickly pay down what you currently owe.
- Gradually rebuild your credit. If you have struggled with debt, you may become "credit shy," choosing to avoid credit altogether. However, this is not the correct course to follow if you want a healthy credit rating. Good credit comes from having credit, but you have to use this privilege responsibly. If you are having difficulty obtaining a traditional credit card due to a low credit score, you may want to consider applying for a secured credit card. With these cards, you deposit your own money into an account, and the amount that you deposit becomes your credit limit. And with regular use of the card and timely payments, your credit rating will begin to improve.
Taking charge of your finances and building back your credit standing will take time and dedication, but the rewards that you will eventually enjoy will be well worth your efforts.
Improving Your Credit Rating with an Auto Loan
If you live anywhere between Halifax and Vancouver, there's a chance that you need access to reliable transportation every day. Having a car is necessary to get you to work, school or wherever your life takes you. And if you have damaged credit, purchasing a vehicle can be challenging. We understand this at Canada Auto Loan, and we're here to help. When you contact us, we will connect you with a dealer in your area who is qualified to work with your situation. Our process is quick, easy and free of charge, and once you’re approved for a car loan, you'll have the opportunity to improve your credit with every timely payment.
There's no obligation attached when you fill out our fast and completely secure online application, so you can confidently get started today.