Too many times have I seen people guard their phone like in a maximum security prison. No one can go through it, touch it or even look at it unless they have the required security clearance by the owner, and yet there are still strict rules. God forbid you drop their precious artifact or accidently swipe left or right when viewing a photo. Going through their conversation history is a big no no. Why do we place such importance on a phone? I understand that for most people, their phone is their life. It holds all their secrets, ambitions, memories and passions so there will naturally be a level of protectiveness, however there are other things you should protect with the same ferocity. Like your credit history.
Without a good credit history, there will be no phone (unless you buy the phone outright). Your credit history is the essence of who you are - at least to banks and lenders - and can even impact your ability to land that coveted new job. Your credit history and credit score plays a huge role in determining if you can get that new car, that new house, new phone, new furniture etc. Basically, anything that you can get now and pay for later. So why not protect it like you do your phone?
The first thing you should do is get a copy of your credit report and credit score from Equifax and/or TransUnion. A credit report is a summary of your credit history as per the Financial Consumer Agency of Canada. Lenders send information about your accounts to the credit reporting agencies and the report also includes personal information that is available in public records, such as bankruptcy. Your credit report will include detailed information on each of your credit products, such as: when you opened your account, how much is the balance left owing, if you are making your payments on time, if you have missed any payments and whether you go over your credit limit. As for your credit score, it's a three digit number that is calculated using a mathematical formula based on the information in your credit report. Credit scores range from 300-900 with 900 being the best score.
Once you receive your credit report and score, PROTECT IT! Go over it thoroughly to ensure of its accuracy, make sure to dispute any errors with Equifax and/or TransUnion. Once you have confirmed your credit report is accurate, keep it that way. There are many things you can do to protect your credit history. You can order a new copy of your credit report on a regular basis and check for accuracy. Some people do it every month or every three months or even annually. Equifax & TransUnion even offer a service where they can notify you of any changes on your credit report in real time.
When buying real estate in Canada, your credit history and score are examined closely to ensure you have indeed shown the ability to repay previous debts so that the lender will feel more comfortable loaning you a large sum of money to buy that new property. Therefore, if you are buying your first home, selling your current home to buy a new home or looking to invest in real estate, I suggest you start with reviewing and improving your credit score and history. Then, and only then, should you hire a REALTOR® to begin or resume your journey into the real estate world.
Look out for the next blog on how to improve your credit score.
P.S You can email me for any questions or clarification: firstname.lastname@example.org