As a child, I remember my father telling me how important it is to pay your bills on time and have good credit, but I never understood why? It’s a good thing I listened. I now understand maintaining your credit score is a very important factor.

In the society we live in today, our credit is more important than our cash if you’re looking to purchase your own home.


What’s required? a minimum credit score of 650 or higher to purchase a home.


Credit Reports are maintained by two organizations in Canada known as “Credit Bureaus”. They are Equifax and TransUnion.

The Main factors used to calculate your score includes:

  1. Payment History – (Are payments made on time?)
  2. Available Credit Usage – (Are you utilizing 30% of available credit?)
  3. Length of Credit History – (Are payments paid in FULL in a timely manner?)
  4. Number of Inquiries – (How often are credit reports requested?)
  5. Types of credit – (Car, Furniture, Credit Card, Line of Credit, etc.)


Your score will be DAMAGED if you:

  • Miss or make a late payments – The longer you wait to make payments, the worst the impact on your credit report and score.
  • Have accounts sent to collection agency. (Chequing/ Savings, Student loan, etc.)
  • Whether you declare bankruptcy.
  • Withhold payments due to a dispute. (ALWAYS pay then dispute)



When you get your Credit Report, you will generally see a number between 300 and 850 – this is your score. Below “ratings” are a number between 09, which reflect current payment status of each account.

0            Account exists, but there is no recent activity to be rated or too new to rate
1            Account is “PAID AS AGREED AND UP TO DATE”. This is the “BEST” Rating.
2-5         Account payment is overdue but the account is not considered “Bad Debt” yet.
7            Payments are being made through a third-party program.
8            Repossession or Foreclosure of collateral.
9            Bad Debt. Account is in collections.



One of the best ways to establish or rebuild your credit report / history is to apply for a “secure credit card”. Usually, the amount required for deposit is equalled to the credit limit for the credit card. Prepaid credit cards will NOT help you build your credit history because it is not reported to credit agencies.



It’s important to maintain your credit history.  Here are some key steps you should take:

  • You should review your Credit Reports at least once a year.
  • If you find incorrect information on your Credit Reports, contact Equifax or TransUnion so that they can begin the Dispute Resolution process.
  • Always pay all your bills on time!  (Make at least minimum payments)
  • Don’t apply for too much new credit in a short period of time.
  • Don’t bounce cheques! (Your bank might report to credit bureau)
  • ALWAYS pay then dispute, lenders will report payment as late if not received on time.
  • The key is to stay under 30% of your available credit for the highest credit score.

TIP: ~ When you use a large percentage of available credit lenders see you as a greater risk, EVEN if balance is paid in full by the due date.  For example, if you have a credit card with a limit of $5,000 and a line of credit with $10,000, your available amount will be $15,000. Try not to borrow more than $4,500.

For more information, contact one of the credit bureaus directly at:

Happy Credit Scores Everyone!