2. Do not open any new credit cards that you will not need just to try and increase your available credit. This approach could backfire and actually lower your score due to inquiries.
3. Try to keep your total account balances as low as possible. High outstanding debt will negatively affect your score. A good range is 4%-12% of the total available credit.
4. Correct any incorrect information that might appear on your credit report. If there is a discrepancy, notify Equifax immediately before it negatively effects your beacon score.
5. If your credit is severely damaged, or you have a very short credit history, there are numerous ways to improve your beacon score over time. Consider opening new accounts and ensure that they are paid off on time. Make sure these accounts are ones that will be reported to a credit bureau.
6. If you need help building your credit from scratch or re-establishing credit after bankruptcy or a consumer proposal, take advantage of a secured credit card offered by your bank or your broker. These credit cards usually require a minimum deposit of $500 or more.
7. To minimize the number of inquiries on your credit report, don’t apply for multiple credit cards over a short period of time, or for a card you’re not likely to get. Apply for new credit accounts only as needed. Also if you choose to shop around for a mortgage, you must be careful of the number of times the bank pulls your credit report. I suggest going to a Toronto mortgage broker and having them pull it once and letting them shop around to find you the best rate.
8. Make all of your payments on time. If for some reason you miss a payment, be sure to pay the following month. All late payments and delinquent accounts will be noted on your credit report and there is no way to remove them.
9. Keep checking your credit report regularly. Whether your buying a home or not, this should be done once a year to ensure that your information is up to date and that your not a case of identity theft.
Read about The Importance of Good Credit here.
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