Improved Credit Scores Benefit New Immigrants in Canada
In Canada, managing credit is an essential part of establishing a solid financial foundation. With over 150 years of experience, TD Bank Group serves over 16 million Canadians with a network of over a thousand branches and thousands of ATMs across the country, providing a wealth of knowledge and resources for newcomers.
Your credit score, a three-digit number between 300 and 900, indicates how you manage credit and the associated risk. Credit rating agencies focus on key factors such as payment history, credit utilization, length of credit history, types of credit, and new credit inquiries when calculating your score.
Missed payments or carrying high balances can lower your credit score, making it difficult to secure loans or credit cards in the future. To avoid this, consider using budgeting tools like TD's mobile app or EasyWeb online banking to help manage bills and avoid missed due dates.
Building credit in Canada can be achieved through various means. Signing up for a phone or internet plan can contribute to credit building if the service provider reports to the credit bureau and bills are paid on time. Similarly, opening a credit card designed for newcomers can help establish credit history and improve your score.
Taking on other loans responsibly, such as car leases, student loans, or mortgages, can also improve your credit score by demonstrating your ability to manage larger debts. However, it's essential to ensure you can afford these obligations before committing.
Regularly checking your credit report is crucial for understanding your score and spotting any mistakes. The three credit bureaus that monitor and report on customer credit activities in Canada are Equifax, TransUnion, and Experian. Your credit bureau report lists your on-time payments, late payments, balances owed, and how much credit you've used.
For more information about TD's offerings designed specifically for newcomers, consider booking an appointment with a TD Personal Banking Associate. TD Bank Group has a century of experience helping newcomers navigate the Canadian banking system, and their New to Canada Banking Package may be just what you need to get started.
Remember, paying bills on time and keeping credit balances low can significantly improve your credit score. Using a credit card for everyday purchases and making payments by the due date can help build credit history over time. Credit scores from other countries are usually not used in Canada, where Equifax and TransUnion collect and report credit information.
In Canada, scores of 760 or higher are considered excellent. By following these tips and taking advantage of the resources available, you can build and manage your credit effectively, paving the way for a financially secure future.
