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Myths about credit scores: Global Morning News

 

A good credit score can have a major impact on big purchases like a car or a house, but the credit rating system can be a little bit confusing and is often misunderstood. For more on that we’re here with Jas Dhillon from Coast Capital.

Does your credit score go down every time you check it?

If you apply for credit several times within a one year period, your score will lower. But what most people don’t know is that if you’re the one that’s requesting your own credit report or your own credit score there is no impact to your credit rating. And another important thing to note is if you are shopping for a mortgage or for a car loan within a short period of time, there is no credit impact to your credit rating either. Although credit reporting agencies do recognize that consumers–when they’re shopping for a home or shopping for a car–they are going to have several credit checks within this time frame. All of these inquiries within a short window of time will only count as one inquiry.

Where can people check their own credit score?

You can do that through Transunion and Equifax online and the reports are free. I highly recommend that people do this on a regular basis.

What happens to your credit score if you make late payments on a credit card? Are you in the clear as long as you pay the creditor eventually, or no?

The answer is no. You want to make sure you’re making your payments on time and not missing your payments. Your score will lower even if you end up making all of your payments. So when you apply for credit you’re agreeing to the terms and conditions that are set out by the creditor and it’s super important to ensure that you’re following through on those obligations.

What advice would you give someone who  maybe has bad credit but wants to fix their financial future?

Well the first thing I’d say is there is absolutely hope to fix your credit score. If you start establishing some healthy financial habits, you can improve your score. In Canada most of the information that is recorded on your credit report does go away six or seven years with the exception of any judgements against you, bankruptcy, the first thing I would say is always have a copy of your report so you know what you’re working with. The next step is contacting your financial advisor who’s going to be able to give you some personalized advice on how to improve your credit. At Coast Capital we’re ready to talk and help people face their real financial challenges and reach their real goals. So as daunting as it is if you’re dealing with any credit issues or large amounts of debt you want to face that head one. You really want to pick up the phone and book an appointment and start that first step towards improving your credit.

 

 

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This article is provided for general information purposes only. It is not to be relied upon as financial, tax, or investment advice or guarantees about the future, nor should it be considered a recommendation to buy or sell. Information contained in this article, including information relating to interest rates, market conditions, tax rules, fees, and other investment factors are subject to change without notice and Cost Capital Savings Federal Credit Union is not responsible to update this information. All third party sources are believed to be accurate and reliable as of the date of publication and Coast Capital Savings Federal Credit Union does not guarantee accuracy or reliability of such sources. Readers should consult their own professional advisor for specific financial, investment, and/or tax advice tailored to their needs to ensure that individual circumstances are considered properly and action is taken based on the latest available information.

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