A Beginner’s Guide To A Good Credit Score
Most people need to take out a mortgage at some point in life, get financial assistance, or simply want to apply for a credit card. The success of the mortgage or credit card application depends on several factors such as income level, employment status, and, apart from many other factors, credit score.
A credit score is a number obtained by statistical analysis that lenders use to help them decide how likely they will be repaid on time if they approve a mortgage or credit card. Lenders also use credit scoring to help determine whether to extend or deny credit.
Credit scoring models vary in Canada. Generally, credit scores from six hundred and sixty to seven hundred and twenty-four are considered good. Seven hundred and twenty-five to seven hundred and fifty-nine are considered very good, and seven hundred and sixty and up are considered excellent.
While it all might sound simple enough, don’t be fooled. Credit scores are not a straightforward beast. Maintaining a healthy credit score can be complex and stressful, and at times seemingly impossible. Even worse, fixing a damaged credit score can take time and cause you to miss out on opportunities for investment and financial independence.
To help you on your path to a credit score that will pretty much guarantee you financial assistance, mortgage broker Leanne Gould has put together a Beginner’s Guide to a good credit score that will hopefully be helpful.
Getting Started
Learn about credit early in life: When calculating a credit score, credit bureau companies in Canada, like Equifax, and TransUnion analyze the length of your credit history and public records. So, to successfully demonstrate your creditworthiness, it is wise to bank a portion of any money you receive from early on in life, as this shows healthy financial habits and discipline. Apply for a credit card as soon as you can, and do not abuse credit privileges.
Next Step
Consciously maintain lines of credit and your credit score: Once you are approved for credit, you must take care to pay the installments on time, keep personal and business lines of credit open, and make generally intelligent decisions in terms of your expenditure. Remember, mistakes involving your credit score show up, last for years, and often can’t be removed entirely.
Advice From The Pros
Seek help: Be ready to sacrifice and ask for help if you are in danger of defaulting! When it comes to mortgages and financial commitments like credit cards or other lines of credit, if you feel like you might default on a payment, it is critical that you ask for help from friends, family, or your business associates to avoid a late payment or missing the payment altogether. You must recognize you made a legal commitment to repay the debt or contribute to savings and be diligent and willing to sacrifice towards that goal.
Ask your mortgage broker questions: Sit down with your mortgage broker or someone who understands credit and accountability, and ask questions that clarify and educate. Everyone has their own beliefs, but even credit experts will be able to tell you, the rules are constantly changing, so you need to stay up to date and aware.
As a licensed mortgage broker since 2009, Leanne Gould has the expertise to help you with your mortgage needs. Before becoming a mortgage broker, she worked for CIBC and RBC for over fourteen years. So, she is proficient in financial management and aware of options that could suit your needs. Currently, her mortgage solutions include construction or draw mortgages, mortgage renewals, mortgage refinance, home equity line of credit, self-employed mortgage, rental property finance, reverse mortgage, and alternate or private lenders. Her services are available to clients across Canada and Alberta, including Wetaskiwin, Ponoka, Bashaw, Lacombe, Blackfalds, Rocky Mountain House, Sylvan Lake, Red Deer, Stettler, Innisfail, Bowden, Olds, and Didsbury. Visit her website to learn more, or contact Leanne Gould Mortgage Broker today if you have questions about your mortgage needs.