understand your credit report

How to Understand Your Credit Report

In an effort to help consumers Allan Marshall & Associates Inc has put together some information about Credit Bureaus.

Many of the questions and answers outlined are asked of our employees on a daily basis.

How does the Credit Bureau work?

The Credit Bureau collects information available through public and government records as well as information reported to them by your creditors. All the information is gathered together in a report called a “credit report” and is sold to your creditors. Your creditors often request this type of information to help with decisions, when making and reviewing loan applications.

What information is on a credit report?

  • Personal identification – name, address, birth date, Social Insurance Number (SIN)
  • Inquiries – a list of those who have requested a copy of your credit report
  • Public Record Information – Judgments, Bankruptcy, Secured loans
  • Third Party collection – Information about debts being collected by third parties
  • Trade information – Payment history and rating (R0 – R9)
  • Consumer Statements – A statement you wish to post along with your credit report.

How long does the Credit Bureau keep information on my credit file?

  • CREDIT INQUIRIES: An inquiry made by a Creditor will be kept on your credit report for three (3) years from the date of inquiry.
  • CREDIT HISTORY and BANKING INFORMATION: A credit transaction is kept on the system for a period of six (6) years from the date of registration.
  • CREDIT COUNSELLING and VOLUNTARY DEPOSIT: The system keeps record of a voluntary deposit or credit councelling program for a period of three (3) years from the date of last payment or the conclusion of the Credit Counselling Program.
  • CONSUMER PROPOSAL: The system keeps record of a registered consumer proposal for three (3) years from the conclusion of the Proposal.
  • BANKRUPTCY: In the case of a first time bankruptcy the system keeps record of a bankruptcy for six (6) years from the date of discharge. In the case of multiple bankruptcies the system keeps notice of bankruptcy for fourteen (14) years from the date of last discharge.
  • JUDGMENTS AND SEIZURES: The system keeps record of any judgments or seizures for a period of six (6) years.
  • COLLECTION ACCOUNTS: The system keeps record of any accounts that were put into collection for a period of six (6) years from the date of last activity.
  • SECURED LOANS: Records of secured loans are kept in the systems for six (6) years from the date the loan was filed with the credit bureau.

What does your credit rating mean?

  • R0. Too new to rate.
  • R1. Pays account on time, usually within 30 days
  • R2. Pays more than 30 days past the due date but less than 60 days.
  • R3. Pays more than 60 days past the due date but less than 90 days.
  • R4. Pays more than 90 days past the due date but less than 120 days.
  • R5. Account is more than 120 days past the due date but had not been reported as bad debt (R9).
  • R6. This code is not currently used.
  • R7. Regular payments are being made through a proposal, credit counselling, orderly payment
  • R8. There has been a foreclosure, repossession or voluntary return of an asset by a debtor
  • R9. Bad Debt: Accounts placed with collection, declared Bankruptcy, or are unable to be located.

Tips about your credit rating:

  • You must give permission to anyone who wishes to review your credit information.
  • Check your credit rating to be sure the information being reported about you is accurate.
  • You are entitled to a free copy of your credit report.
  • You have the right to include a 100 word statement on your credit report. This will be provided to anyone who requests a copy of your report. If you choose to include a statement keep it short so creditors will take the time to read it.

Obtaining a copy of your credit report.

If you would like a copy of your credit report you should contact one of Canada’s credit bureaus for a free copy. To obtain a copy of your credit report you will need to send a request by fax or mail along with two pieces of identification. In a few weeks you will receive a copy of your credit report in the mail. Although Credit bureaus are required to provide you with a copy of your credit report free of charge, many provide access to your credit report “on line” for a small fee. (Please note: The Credit Bureaus will not provide any information about your credit report over the telephone. We suggest you do not phone.)

Contact information for Canada’s main credit bureaus:

Equifax Canada Inc.
www.Equifax.ca

TransUnion
www.transunion.ca

Errors detected on your credit report.

  • When you receive your credit report it will include a form that will explain how to file disputes and have corrections made to your credit file.
  • This can be a difficult procedure where persistence and a fighting attitude may be required to achieve results.
  • The first step to correct inaccurate information on your credit report is to complete the appropriate forms supplied by the credit bureau.
  • The next step is to contact the creditor or other source of the information and request they correct the inaccurate information reported on your credit report.
  • If these steps fail, you should contact the local complaint department of the better business bureau and department of consumer services. (You can find contact numbers for these departments in the blue pages of your local telephone book)
  • If you are still unsuccessful in getting the inaccurate information removed from your credit bureau you may be forced to threaten to sue for libel.
  • Please be advised information on your credit report that is correct you will not be able to remove.