- You want a new sports car, but will the dealership give you a lease?
- You’ve found a great apartment, but will your landlord let you rent it?
- You did well in the interview, but will you get the job?
If you have a bad credit rating, the answer to each of these questions may be “no.”
Your credit file is like a financial report card. It tracks how much money you borrow, and how quickly you pay it back. Every month when you borrow money, use your credit card or pay bills, information about your financial transactions is sent to a credit-reporting agency. The agency uses this information to come up with your credit rating and your credit score.
To learn more about credit, you should understand these topics:
- What is a credit rating?
- What is a credit score?
- How do I check my credit rating and credit score?
- How do I build a better credit rating?
A survey shows Canadians don’t know much about their credit rating.
A recent credit report survey of Canadians found:
- 24% knew their personal credit rating
- 15% had requested a credit report for themselves
- 50% did not know what factors contribute to a credit rating.
Remember: your credit rating follows you everywhere.
If you fall behind on paying off your debts, you will have a hard time borrowing more money next time.
Content in this section is provided in partnership with the Investor Education Fund, a non-profit organization promoting financial literacy to Canadians. To find out more go to GetSmarterAboutMoney.ca.