Managing Your Credit
Do you know your credit score? Millions of us have no idea what our credit score is or what a credit report looks like, yet it is a fundamental aspect of understanding our financial well-being.
When banks review your credit report, they pay special attention to what is called your “Beacon Score.”
It helps financial institutions decide whether or not to grant you credit. The score, can range from 300-900.
Your score is calculated by taking the following information into consideration: payment history, amounts owed, length of credit history, new credit and types of credit.
Here are a few simple tips you can follow to ensure your credit is in check:
- Make your minimum payments on time. You can set up automatic withdrawals to make sure you never miss a deadline again.
- Try not to use more than 50-75 per cent of your available credit. If one of your credit cards is at its limit, try and shift some of the balance to a card that you may not owe anything on.
- Avoid unnecessary credit checks. More than four checks per year can be detrimental to your score.
- The longer you have a credit card on file, the better! Never cancel the oldest credit card you have, even if you no longer use it; the history of that card will be hard to replace.
There are two leading providers of credit information: Equifax and Trans Union. I would suggest you check your score a minimum of once per year.
This article was written by Mortgage Agent Faisal Jamil (M11000962) of Mortgage Edge (10680). For more information, please call Faisal at (416) 471 7551.