Credit Report - Bankruptcy Canada
If you’ve been looking up the steps to applying for a loan online or in general, having discussions about loan applications with your friends and peers – you must have come across the term “credit report” a lot.
What is this credit report and how does this benefit you?
Find out this and more below.
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What Does “Credit Report” Stand For?
Your report is nothing but the history of all your debts and repayments, prepared by a credit bureau.
Credit bureaus engage themselves in drafting credit report for loan applicants to provide credibe information to interested lenders.
The lenders then use this report and other collected information to determine whether it is safe and wise to lend their money to the applicants.
Why is it Important to Have an Updated Credit Report?
As already discussed, your report functions as a mirror to your present financial situation.
It contains crucial information such as your address, social security number, employment history, credit card history including details about high balances, limits and date of obtaining said card.
An updated report could be the difference between being trusted by your lender for your ability to repay and being passed over by him/her for somebody with an up-to-date report.
How to Receive and Update Your Report
You can use the following steps to obtain your credit report and update it to make it error-free –
- Check Your Report – America has three consumer credit bureaus which are tasked with drawing up credit reports. You can visit https://www.annualcreditreport.com/ and keep a check on the annual report prepared by these bureaus every year.
- Look Out for Mistakes – Once you’ve received your report, keep yours eyes out for any mistake or failure in updation of information. If you notice that your report bears a mistake or still reflects unpaid credit incorrectly, you can proceed to make the necessary changes.
- Correct Found Mistakes – You can formally apply to correct the mistakes in your report by supplying evidence of your argument. Similarly, you can also write to the credit bureau and ask them to have your comments attached to the report, so the lender is aware of the mistakes.
- Make it More Attractive – You don’t simply want to stop at correcting the errors in your credit report, you want your report to fetch you that mortgage. So, what do you do? You make active efforts in lowering your debt load. Prioritise paying off high interest debts over those which owe lesser interest rates. You want to impress your financial trustworthiness upon your potential lender and paying off your existing debts is a great way to start.
Repair Your Credit
A good credit report if often all the document you need to convince an interested lender to lend you their money.
In such a light, maintaining impressive credit should be high on your list of responsibilities if you’re considering applying for a loan/mortgage anytime soon.
That said, it is never wise to let your debts grow.
Make it a practice to repay your debts whenever you can and you will have yourself a sturdy and dependable credit history by default.