MANAGE YOUR CREDIT REPORT
To manage your credit report, we recommend you follow these steps:
1. Get a free copy of your credit report
Credit bureaus sell information; they want you to pay to buy your credit report. Don’t pay for your credit report. By law, you can obtain your own credit report for free. There are two main credit bureaus in Canada: Equifax and Trans Union. Click on the links below to get the forms necessary to get a free copy of your credit report.
- Equifax credit report information page and Equifax pdf request form
- Trans Union credit report information page and Trans Union pdf request form
2. Review your credit report
To manage your credit report well, it is important that you review the report to determine if it contains any errors or negative comments.
An error may include a debt that you have already repaid (see #3 below). A negative comment may result from a department store credit card that you stopped using ten years ago, but if it had a $10 balance owing, it may still show up on your credit report (see #4 below).
3. Correct any errors on your credit report
If you find an error, contact the credit bureau and offer proof that you do not owe the money. You may need a letter from the creditor indicating the payments were made, or you may provide canceled cheques to indicates payments were received.
You may also send a letter to the credit bureau explaining your side of the story; your comments can be attached to your credit report.
4. Repair any negative information in your credit report
If you owe a creditor $10 and they have filed a negative credit report with the credit bureau, repay the creditor and ask the creditor to remove the negative item from your credit record. If a debt is legally owing, the debt must be paid or discharged before it can be removed from your credit report.
5. Pay off debt
Even if your credit report indicates that you have made all of your regular monthly payments, a potential lender may look unfavourably on high levels of debt. The solution is to pay off as much of your existing debt as possible before applying for a new loan.
We recommend that you pay off your highest interest debts first, so pay the 18% interest credit card off first, and then repay the 16% interest credit card.
6. Take other action
If you have more debt than you can possibly repay, your credit report will only improve by formally dealing with your debts. You may need to file a proposal to your creditors, or consider Ontario bankruptcy.