How to Fix Your Credit Report

  • By Jillian Taylor-Mancusi

Your credit score may just be a few numbers, but the information used to determine it affects almost every aspect of your financial life. A credit report is used to determine if you qualify for everything from an apartment to a job. It’s an important life tool that can mean the difference between affordable credit and high interest rates. If your credit has taken a hit, knowing how to fix your credit report can help you improve your score.

Build Good Money Management Habits

Developing good money management habits is the first step. Basic money management habits that will help you improve your credit score include:

  • Creating a livable budget. A budget helps you manage your money and makes it possible to prioritize your spending. Budgeting ensures you have the money you need to pay your bills.
  • Paying your bills on time. Use online bill payment services, complimentary auto-payments, and bill alerts to keep yourself on track.
  • Avoiding new credit cards or other debts. More debt adds a larger burden to your budget. It also lowers your credit score. If you are working to improve your credit report, taking on new debt makes your job more difficult.
  • Communicating with your creditors. If you are having a hard time paying your bills on time, talk with your creditors. Most lenders want to help you repay your obligation, but they need to know there is a problem. Don’t ignore their calls. Setting up a payment plan or other arrangement can help avoid damage to your score.

Give Your Credit Report an Annual Check-up

Credit reports can contain errors that lower your credit score. You can catch these errors and work to have them corrected by examining your credit report at least once a year. There are two major credit reporting agencies in Canada. You can receive your score for free online, but you must request a free copy of your report by mail. To receive a report from Transunion Canada or Equifax Canada, follow the instructions found on their websites.

It’s not uncommon to find errors on your credit report. If you see any inaccurate information, like an account that doesn’t belong to you or a late payment you paid on time, you can dispute it. This is a process that allows you to disagree with the mistake and request investigation and removal. You can dispute errors from both agencies through online forms on their sites.

If you have tax liens and collections, you may be able to remove them by working directly with the party that reported the faulty information. If that doesn’t work, going through the formal process from the credit reporting agencies may give you better luck.

It takes some work, but knowing how to fix your credit report is worth the effort. By adopting good money management habits and keeping an eye on your credit report, you can earn a great credit score.

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