Anyone who has applied for a credit card, or a loan, has a credit file. Because borrowing is so prominent in the lives of Canadians, over 21 million of us own a credit card, and have a credit report that displays most of our personal financial data. This allows a company or lender that is considering granting an individual a loan to assess one’s ability to pay the money back.
However, it is very common for Canadians to have a limited understanding of how a credit score can impact their life outside of an application for a loan or a mortgage. Here are three situations that make it imperative to know your credit score.
1) You could be denied a job
It has been reported that somewhere around 60% of employers (especially those that work in finance) will check a potential employee’s credit before they finalize a hiring decision. In this instance, having poor credit can hinder you from obtaining your dream job.
2) It will determine where you live
If you’re looking to rent an apartment, it’s always important to be aware that most landlords, and some rental companies, will require a credit check as well as verification of income before allowing you to take over a property.
3) You can get stuck paying more for insurance
When determining your rate, insurance companies also use credit scores to assess your level of financial risk. If you are perceived as a greater liability, they will typically charge you more. Also, many places allow credit scores to be used as a factor in determining premiums because they can be linked to increased claims.
These three life circumstances are heavily dependent on your credit score being maintained. By knowing your credit score you will be able to determine your overall health, and start on the steps necessary to raise your score if necessary.
There are two easy ways to gain access to your score and assess your credit’s health. By going to either www.transunion.ca or http://www.equifax.ca, you will be able to contact either of the two major credit bureaus in Canada and find out your score at a relatively low cost.