Understanding your credit report and credit score – Part 2
Last week, we noted that people with a lower credit score can find themselves paying a higher interest rate, or even denied access to certain types of loans. The good news is that by taking a few basic precautions, prospective borrowers can protect their credit report and credit score, and increase their access to better rates and a better choice of mortgage products.
Here are a number of steps that you can take to keep your credit report and credit score healthy:
- Pay your debts on time – always meet due dates.
- Don't max out your credit cards – use only up to 50% of a card's credit limit.
- Borrow only the amount you can afford to repay.
- Check your credit report for mistakes. You can obtain a copy of your credit file free from Equifax (1-800-465-7166) and Trans Union (1-800-663-9980). These free reports will not contain a credit score and it's a good idea to get both reports. You can order more comprehensive reports including your credit score online from these companies, for a fee.
We can advise you on the ins and outs of improving your credit score over time. For those with bruised credit, as your good credit history is established, in due course your borrowing options will increase.