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Two Items that Might Be Getting You a ‘Bad’ Grade…

June 1, 2016

Schools out for most kids soon…but they aren’t the only ones awaiting report cards

poor credit score for Canadians

A recent article in the Globe and Mail talks about the story of a young Canadian who, after graduating from University, found out that a debt she had paid off was still appearing on her credit report. This debt that remained, although paid by her in full, had negatively impacted her credit score and her ability to finance the purchase of her first home.


While a case like this is certainly unfortunate, it does happen from time to time. The issue being that often times Canadians are unaware as to how important their credit scores can be, and can sometimes be unaware as to what may or may not impact their credit report.


Credit scores can be negatively impacted by a variety of mishaps – some as small as a late payment on the balance of your credit card, to matters as significant as bankruptcy.


Financial gurus typically advise to clients that they request a higher credit limit than what they require. Having a higher credit limit than the amount you need to borrow will help your credit score; the idea being that if you owe $7000 but your credit limit is $20,000 then your utilization rate of your credit is low. A rule of thumb suggests that Canadians should try and stay below 35% utilization on their revolving credit loans.


According to the article, as many as 52% of Canadians are unaware of their credit scores. Not knowing this information, as important as it is, can certainly be understandable. Many Canadians only find out their credit scores before the purchase of a new car or before buying a new home.


However, most people may not know about the impact of these two items…

Your Mortgage Payments

Yes, your mortgage payments matter! While there was a time when your mortgage may not have been reported on your credit bureau, missed mortgage payments do indeed impact your credit rating.


Missed a few mortgage payments during your term? It will impact your credit score, making it difficult to switch to a better mortgage lender or even causing your current lender to not make you an offer to renew at the end of your term.

Your Phone Bill

Feelings can often flare when it comes to this issue, but yes, not paying your cell phone bill can impact your credit rating. On occasion, clients will find themselves recalling an old bill that just wasn’t paid for whatever reason…perhaps someone at the call center had told them that their bill was cleared or perhaps there was some dispute regarding the balance of the bill.


Unfortunately, that old phone bill of a hundred dollars can cause headaches later on when you’d like to buy a new home for hundreds of thousands of dollars!


If you’re unsure of what can impact your credit score, or you’re looking to improve your recovering credit score before purchasing a new home – talk to a MonsterMortgage.ca Mortgage Expert today by filling out the form at the top of the page and put more money in your pocket – not your bank’s!