29 Mar


DID YOU KNOW that most people don’t like talking about their credit scores?!?

Did you also know that even if yours isn’t great, there’s ways to get your credit score back on track!

When I say “fix” it kind of implies that it’ll be a fast process, sorry for the bad news, but it’ll take some time, months, and maybe even years, maybe a better word would be “re-build”.

Bad credit happens for so many reasons, it’s not just a result of financial mismanagement, but circumstances out of your control like an accident, illness, reduced income due to separation/divorce, unemployment, and/or other family issues quite often play a huge role in destroying one’s credit.

Living with bad credit can be very difficult, so here are some ideas on how you can be pro-active about bringing your credit back to where it should be!

First of all, don’t ever fall for credit “repair” scams that “claim” they can remove accurate information from your credit report; while it’s true that you have the right to file a dispute to remove INACCURATE information, accurate information can’t be removed.  You’ll either have to wait for it to come off your report, which can take 7+ years, or try negotiating with the creditor, which takes work.  You may be able to work with a creditor in removing negative information if you pay the debt off or negotiate a settlement, but whatever you do, ensure that you get the creditor to agree in writing.

Secondly, identify WHY you have a credit problem; you need to know why you have bad credit, and talking to a credit counsellor is always an option.

Paying off your old debts/collections and/or reducing credit card balances should be your priority when trying to fix bad credit [below 75% of your limit is ideal].  Create a monthly budget and use it.  Pay off debt that has the highest interest rate.  If your low score is due to maxed credit cards and/or very high balances, this could be a quicker fix and should only take a month or so for your credit to rebound!

If creditors are calling, you can inform them in writing that you only wish to be contacted in writing and this will stop the collection calls.  This will only work until your debt is sold to a collection agency, and then you can write them letters too.  Always remember that creditors can take you to court if you have a job/assets and a judgment is good for ten years and can be renewed for another ten years.

It may take some time, but if you manage your finances wisely, your credit will eventually improve and you may be able to get credit with a low limit.  If you meet your obligations by paying on time every single month, your credit score will improve and before you know it, you’ll be in a much healthier financial position!

Depending on which province you live in, the longest that negative information can remain on your credit report is six to seven years, and for bankruptcies it’s six to seven years after you’ve been discharged.

Unfortunately, for some, bankruptcy is their only option and should only be used as a last resort; this is also the slowest way to re-build your credit as the whole process can impact you in a negative way for up to ten years!  Some people are unable to go bankrupt due to being unable to afford the bankruptcy fee or they earn too much money and/or have too many assets.

Follow these points to help re-build your credit…

identify why you have a credit problem

create a monthly budget and use it

pay your debts on time every single month [don’t be late!]

have reasonable credit limits available, but try not to use them

don’t apply for credit too often

keep doing the above and your credit score will thank you

don’t forget negative information takes time to drop off

learn to live within your means without using credit

make living on a CASH-only budget a lifestyle choice

ASK YOURSELF THIS ONE QUESTION:  if someone took away all of your credit cards today, how would that affect you, would you continue on just like usual, or would you be devastated?

Generally speaking, the irony is that the people who don’t have good credit are the ones who wish they did, and the people who have good credit don’t often care because they’ve usually learned to work with what they have.  If you don’t have the money to buy something you need/want, then don’t buy it, or save to buy it!


Start by getting a copy of your credit reports, there are two credit-reporting agencies in Canada, Equifax and TransUnion.  Learn from your past financial mistakes and keep moving forward, and always try to live within your means!  Re-building your credit isn’t complicated, it just takes time.

“Procrastination is like a credit card; it’s a lot of fun until you get the bill.” | Christopher Parker