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What is a credit rating and what affects my credit rating?

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When you borrow money, use a credit card, or even pay some kinds of bills, companies called credit bureaus keep a record of your activity. These companies also keep track of whether or not you have paid your loans and bills on time. Then they assign you a credit rating or score.
Lenders look at your score to decide whether or not to loan you money, give you a credit card, or offer you other kinds of credit. If you have a poor credit rating, you may not be able to borrow money when you need it. You can find out more about your current credit rating on the Financial Consumer Agency of Canada web site.
What affects my credit rating?
A lot of things affect your credit rating, including your history of:
  • Paying off loans and credit cards
  • Paying bills on time
  • Going over the limit on your credit cards
  • Carrying a balance on your credit card from month to month
  • Going bankrupt
  • Having your bills go to a collection agency.
Your credit rating is also affected by how long you have been using credit and what kinds of credit you have used. To learn more about your rights and responsibilities when you borrow money, visit the Financial Consumer Agency of Canada web site.

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Here are some related link(s):
[1] Checking Your Credit Rating – CBC News This web site explains a credit rating and how it is established.
[2] Credit Bureau Reports – Scotiabank This web site identifies what a credit rating is and how to obtain a copy.
[3] Understanding Your Credit Report – This web site explains your credit rating, the implications and the factors affecting it.

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