[et_pb_section fb_built=”1″ make_equal=”on” specialty=”on” _builder_version=”4.0.8″ custom_padding=”0px|||||”][et_pb_column type=”3_4″ specialty_columns=”3″ _builder_version=”3.25″ custom_padding=”|||” custom_padding__hover=”|||”][et_pb_row_inner _builder_version=”4.0.8″][et_pb_column_inner saved_specialty_column_type=”3_4″ _builder_version=”4.0.8″][et_pb_text _builder_version=”4.0.8″ hover_enabled=”0″]<\/p>\n
Maintaining an acceptable credit rating is a priority for many Canadians. Having \u201cgood credit\u201d can give you access to vehicle financing, credit cards, cellular networks, and other important services. For the Canadians who are dealing with insolvency, it becomes almost impossible to keep up with. No one is thinking about their credit scores when they are dealing with service interruptions, collection agencies and impending legal action from creditors. It is important to understand the effects of insolvency on your credit rating and how to improve your score. Remember that the first step to improving your credit is getting out of debt. A consumer proposal may be the best option to get you out of debt<\/strong> so you can start to rebuild a strong credit history.<\/p>\n [\/et_pb_text][\/et_pb_column_inner][\/et_pb_row_inner][et_pb_row_inner _builder_version=”4.0.8″ module_id=”what-is-credit” hover_enabled=”0″][et_pb_column_inner saved_specialty_column_type=”3_4″ _builder_version=”4.0.8″][et_pb_text _builder_version=”4.0.8″ hover_enabled=”0″]<\/p>\n There are two major credit reporting agencies in Canada: Equifax and TransUnion. These agencies collect and report information related to your financial obligations including credit cards, cell-phone services, utilities, and other liabilities. They keep track of which bills are paid on time, which ones are paid late, and which ones are not paid at all. Any creditor can report a debt, and many are reported automatically.<\/p>\n Your credit report includes your history plus a calculated risk-factor determined by the agency. This is what people are checking when they do a \u201ccredit check.\u201d<\/p>\n<\/blockquote>\n The credit bureau of Canada classifies every person\u2019s credit according to the following scale:<\/p>\n \u00a0A consumer proposal R7 rating shows the CRA that you are no longer falling behind on payments or facing collections, and that have paid your debts in full.<\/p>\n<\/blockquote>\n [\/et_pb_text][\/et_pb_column_inner][\/et_pb_row_inner][et_pb_row_inner _builder_version=”4.0.8″ module_id=”low-score” hover_enabled=”0″][et_pb_column_inner saved_specialty_column_type=”3_4″ _builder_version=”4.0.8″][et_pb_text _builder_version=”4.0.8″ hover_enabled=”0″]<\/p>\n If you are looking to secure financing or credit, a lower rating can pose challenges. Lenders will consider you a higher risk and may be less willing to provide their services. You may have to look for an alternative to traditional lenders if you are considering vehicle or mortgage financing, a personal credit card, etc.<\/p>\n [\/et_pb_text][\/et_pb_column_inner][\/et_pb_row_inner][et_pb_row_inner _builder_version=”4.0.8″ module_id=”view-credit-history” hover_enabled=”0″][et_pb_column_inner saved_specialty_column_type=”3_4″ _builder_version=”4.0.8″][et_pb_text _builder_version=”4.0.8″ hover_enabled=”0″]<\/p>\n Knowing and understanding who else may request your credit history can also be helpful:<\/p>\n With the exception of financial organizations, no one can check your credit without your consent. No person, including friends or family members, can access your credit report without valid reasoning and your signed consent. Your credit history cannot be accessed without a note of the inquiry being made on your report, so you can always see who has received a copy of your report.<\/p>\n If you have a low credit score, the good news is, there are still options available to you. In fact, there are solutions to help thousands of people just like you. A secured card works the same as any other credit card, but you must make a deposit amount for varying credit limits. We suggest this method to practice healthy spending habits and rebuild your credit score. You can also have another person co-sign financing or a credit card \u2013 this offers security for the lenders and is less restricting.<\/p>\n Consumer proposals are the #1 alternative to bankruptcy in Canada. If your total debts do not exceed $250,000 (not including a primary home mortgage) and you have the ability to make regular payments, a proposal may be the most financially affordable and <\/em>credit-friendly debt solution for you. At Hudson & Company, a Licensed Insolvency Trustee (LIT) will evaluate your financial circumstances to determine if a consumer proposal is the best debt solution for you.<\/p>\n [\/et_pb_text][\/et_pb_column_inner][\/et_pb_row_inner][et_pb_row_inner _builder_version=”4.0.8″ module_id=”rebuild-credit” hover_enabled=”0″][et_pb_column_inner saved_specialty_column_type=”3_4″ _builder_version=”4.0.8″][et_pb_text _builder_version=”4.0.8″ hover_enabled=”0″]<\/p>\n If you have been told that a consumer proposal will \u201cfix\u201d your credit score, this is inaccurate. Instead, a proposal gives you the opportunity to eliminate your debt and rebuild good credit once again. Your financial habits during and following your proposal will determine your credit score. If you are wondering how long it will take to rebuild your credit, the answer is different for every person. While the goal during a consumer proposal is debt freedom, the only way to begin rebuilding your credit is to borrow again.<\/strong> If you have struggled with managing debt in the past, it is important to establish healthy spending habits and manage your finances wisely. It is important to rebuild your credit, but ensure you have all the right tools to succeed. Have a clear plan for success before you sign up for a new credit card or loan. We recommend the following tools for success when rebuilding your credit: <\/em><\/p>\n You can request the detailed statement of your income and expenses from your Licensed Insolvency Trustee (LIT). Using this as a template, you can follow this guideline when putting together a monthly budget. Above all, you must be diligent about keeping track of your finances. Having a budget in place will help you track and plan for your monthly fixed and variable costs. We also recommend setting aside money for rainy days and unexpected circumstances. Because life does not always go according to plan, we advise setting aside a minimum of $1,000 for emergencies. With a budget in place and an emergency fund in place, you can begin the process of rebuilding your credit with confidence. You can begin this process during a consumer proposal, but your rating will remain the same until the final payment is made on your proposal.<\/p>\n [\/et_pb_text][\/et_pb_column_inner][\/et_pb_row_inner][et_pb_row_inner _builder_version=”4.0.8″ module_id=”credit-types” hover_enabled=”0″][et_pb_column_inner saved_specialty_column_type=”3_4″ _builder_version=”4.0.8″][et_pb_text _builder_version=”4.0.8″ hover_enabled=”0″]<\/p>\n Revolving Credit <\/strong>\u2013 known as \u2018open credit\u2019 \u2013 this means the funds can be accessed at any time (i.e. credit cards or line of credit). During your consumer proposal, it is possible to get a secured card. You will be required to put a deposit on the card. We recommend starting with a lower limit of say $500 and factoring your payments into your monthly budget. To avoid high-interest rates, be sure to pay the card in full every 21 days. As you continue to use your card regularly, you will begin to see your credit score improve significantly.<\/p>\n Installment Credit – <\/strong>this is an agreement between you and a lender to make payments within a term. Typically this method is used for a car loan or mortgage or car loan but applies to any loan. This type of credit is often more costly. A lender may give you a loan for your car, but that vehicle becomes Set payments will be reported to the credit bureau each month. You will see your credit score improve with each payment made on time. We also recommend applying for RRSP or GIC loans in order to boost your credit \u2013 banks get a good interest rate and are typically willing to lend for these types of loans.<\/strong><\/p>\n If you build good credit scores through a minimum of two lines of credit, you can qualify for a mortgage within two years of concluding your consumer proposal.<\/p>\n<\/blockquote>\n [\/et_pb_text][\/et_pb_column_inner][\/et_pb_row_inner][et_pb_row_inner _builder_version=”4.0.8″ module_id=”tips” hover_enabled=”0″][et_pb_column_inner saved_specialty_column_type=”3_4″ _builder_version=”4.0.8″][et_pb_text _builder_version=”4.0.8″ hover_enabled=”0″]<\/p>\n You get to start fresh after a consumer proposal, but you must be diligent about maintaining all your payments. Utilities, phone bills, and all other debts must be paid on time.<\/p>\n<\/blockquote>\n Your banking advisor will consider your savings and assets when determining your interest rates, so it can be beneficial to have savings in the bank.<\/p>\n<\/blockquote>\n [\/et_pb_text][\/et_pb_column_inner][\/et_pb_row_inner][et_pb_row_inner _builder_version=”4.0.8″ module_id=”credit-report” hover_enabled=”0″][et_pb_column_inner saved_specialty_column_type=”3_4″ _builder_version=”4.0.8″][et_pb_text _builder_version=”4.0.8″ hover_enabled=”0″]<\/p>\n All credit bureaus in Canada must provide a free copy of to your credit report upon request. <\/strong>But, this request must be submitted in the form of a letter and sent via mail. Your report may take several days to weeks to arrive. If you need a copy of the report in real time, you can pay for a quick access version online. This electronic report is also more comprehensive, which can be of benefit to you. We recommend accessing this report once your consumer proposal is completed. Check for any errors; they can happen. If you do come across a mistake in your report, you can write a letter to the offending company to correct the error. It is good to check your report every year to ensure that the information is accurate and up to date.<\/p>\n [\/et_pb_text][\/et_pb_column_inner][\/et_pb_row_inner][et_pb_row_inner _builder_version=”4.0.8″ module_id=”fresh-start” hover_enabled=”0″][et_pb_column_inner saved_specialty_column_type=”3_4″ _builder_version=”4.0.8″][et_pb_text _builder_version=”4.0.8″ hover_enabled=”0″]<\/p>\n At Hudson & Company, your initial consultation with one of our Licensed Insolvency Trustees is free, and our knowledgeable team is well-equipped to get you back on track. We have three conveniently located Calgary offices and over 30 years of experience helping people solve their financial hardships. We will be able to find a solution custom-tailored to your needs. <\/strong><\/p>\n Call 1 (403) 265-4357 to get started!<\/strong><\/p>\n [\/et_pb_text][\/et_pb_column_inner][\/et_pb_row_inner][\/et_pb_column][et_pb_column type=”1_4″ _builder_version=”3.25″ custom_padding=”|||” custom_padding__hover=”|||”][et_pb_text _builder_version=”4.0.8″ text_font=”||on||||||” text_font_size=”14px” text_line_height=”1.3em”]<\/p>\n Find exactly what you are looking for \u21b4[\/et_pb_text][et_pb_text module_id=”sticker” _builder_version=”4.0.8″ text_font=”|600|||||||” text_text_color=”#ffffff” text_line_height=”1.3em” link_text_color=”#ffffff” header_4_text_color=”#000000″ background_color=”#099a82″ custom_padding=”20px|2px|20px|20px|false|false” hover_enabled=”0″]<\/p>\n What is “credit” anyways?<\/a><\/p>\n What is the impact of a low credit score?<\/a><\/p>\n Who might request my credit history?<\/a><\/p>\n How do I rebuild my credit?<\/a><\/p>\n Different types of credit<\/a><\/p>\n Helpful tips<\/a><\/p>\nWhat is \u201cCredit\u201d Anyways?<\/h2>\n
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\u00a0What Do The Numbers Mean?<\/h4>\n
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What is the impact of a low credit score?<\/h2>\n
Who else might request your credit history?<\/h4>\n
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What are my alternatives?<\/h4>\n
Should I choose a consumer proposal?<\/h4>\n
How do I rebuild my credit?<\/h2>\n
\u00a0#1 – Budget<\/h4>\n
There are two main types of credit:<\/h3>\n
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Helpful Tips:<\/h2>\n
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How do I get a copy of my credit report?<\/h2>\n
Get started on a fresh start!<\/h3>\n
Easy Navigation:<\/h3>\n
Jump Ahead…<\/h4>\n