It’s no secret that repairing your credit in Canada is no easy feat. Especially if you’ve been struggling with keeping up with your budget.
But did you know that there’s a couple steps that you can apply right now and (almost) instantly see a positive difference in your credit score?
In this article, we compiled our 6 favorite ways to improve your credit score.
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6 Tips To (Almost) Instantly Repair Your Credit
Below, you’ll find our 6 proven tips to help you improve your credit score, without doing that much work.
1. Pay Your Bills On Time
You probably heard this advice times and times again. But paying your bills on time might be the one thing keeping you from a perfect credit score.
Paying your bills on time equals out to about 35% of your credit score calculation hence the importance of that doing so if you want to increase your credit score fast. If you usually forget about your bills, you can always setup autopay.
2. Dispute False Claims On Your Credit Report
False (or erroneous) claims on your credit report can heavily affect your credit report. Did you know that almost one third of Canadian consumers experience an error or a false claim on their credit report during their lifetime?
A false or erroneous claim is when a financial company adds a false or erroneous information about your credit history on your credit report. This mostly happens when your identity has been stolen or when a bank or company mistakenly adds in someone else’s information to your credit report.
If you notice any false claim on your credit report, file a dispute with the credit bureau as soon as possible and, within 30 days, it should be removed from your credit report.
A false claim removed from your credit history could improve your credit score by hundreds of points in less than 20 minutes of actual work.
3. Monitor Your Credit Report
To keep up with false and erroneous claims on your credit report, we recommend you using a free credit report monitoring service such as this one from Loans Canada. This way, you will be able to receive an alert whenever a negative item is added to your credit report and dispute it if it’s a false one.
4. Lower Your Credit Utilization Rate
Most big credit bureaus recommend having a credit utilization rate of less than 30% on your credit cards.
What is a credit utilization rate? - A credit utilization rate is the total amount of credit that you used during a period divided by the total amount of credit you're allowed to use.
Example: If you have 3 credit cards with a total credit limit of 3000$, you should never have more than 900$ on you statement balance at the end of the month.
5. Increase Your Credit Limit
If there’s no way for you to keep up with the credit utilization rate of 30%, we actually recommend you increase your credit limit.
If we take the previous example where your credit limit is 3000$ and you’re using, let’s say 1500$ every month, you can lower that credit utilization rate from 50% to 25% by increasing your credit limit by 3000$ to a total amount of 6000$.
Although, be careful! Increasing your credit limit doesn’t mean that you should start spending more.
6. Stop Closing Your Credit Cards
Whenever you’ve finished paying off a predatorial credit card after years of trying to pay it off, don’t close it (unless it charges you membership fees). The longer your credit history is, the better your credit score is.
As we said multiple times over and over again, increasing your credit score is very hard. But, if you take the time to apply the 6 quick tips we went over in this article, we can almost guarantee an increase in your credit score in the very near future.
If you don’t have the time (or will) to do all of this yourself, did you know that you can actually outsource all of this work to a credit repair specialist? Getting started is easy and free, just book a call by clicking the button below and your journey to a perfect credit score will begin!