Tag: credit score

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CREDIT REPORT: CHECK IT TO IMPROVE A POOR CREDIT SCORE OR A BAD CREDIT SCORE

credit report, credit score, bad credit score, credit bureau, TransUnion, Equifax, credit reporting agencies, poor credit score, trustee, insolvency, bankruptcy, starting over starting nowHave you checked your credit report lately? Everyone I know does not wish to have either a poor credit score or worse, a bad credit score, but many Canadians pay little or no attention to their credit report and that’s a mistake that can seriously impact your life.

According to the Public Interest Advocacy Centre:

  • 17% of Canadian adults had checked their credit reports in the prior three years
  • Of those who checked, 18% found inaccuracies in their credit reports
  • 10% believed they were denied access to financial services because of report inaccuracies

In fact, some credit bureau watchers estimate that there are errors in 10% to 33% of credit files. You may be surprised to know that one of the biggest sources of conflict isn’t fraud, it’s cell phone providers who send overdue accounts to collection. We reported on one such story in a blog titled Your Credit Rating Can Be Ruined Even If You Don’t Do Anything Wrong. Mr. Dave Johnson of Pembroke, Ontario had his credit rating ruined by Rogers even though he never had a Rogers account and he has spent three years fighting a Rogers Bill that isn’t his. “That one derogatory record has a substantial impact on credit score and it stands out on the credit report,” says Tim Ashby, a vice-president of personal solutions for Equifax. If your credit is not in good standing you will most likely be denied a loan or mortgage. It can also affect your ability to rent housing or get hired for a job.

How often should I check my credit report?

According to the Financial Consumer Agency of Canada, check your credit report at least once a year. Review it carefully for errors and signs of identity theft. Order your credit report from both credit reporting agencies. Consider requesting your report from one agency and then waiting six months before you order from the other agency. By spacing out your requests in this way, you may be able to detect any problems sooner.

Who are the credit reporting agencies and how can I contact them to get my credit report?

The credit reporting agencies are TransUnion and Equifax. By clicking on the links you will be taken to their websites where you can access their phone numbers, fax and email in addition to information on how you get your credit report.

Should you discover that you have a poor credit score or a bad credit score, you may need professional help to return to financial health. Ira Smith Trustee & Receiver Inc. is a full service insolvency and financial restructuring practice serving companies and individuals throughout the Greater Toronto Area (GTA) facing financial crisis or bankruptcy that need a plan for Starting Over, Starting Now. Contact us today.

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BANKRUPTCY TRUSTEE TORONTO: HELPING YOU STARTING OVER, STARTING NOW

living paycheque to paycheque, alternatives to bankruptcy, bankruptcy, bankruptcy alternatives, Bankruptcy and Insolvency Act, bankruptcy faqs, bankruptcy process, bankruptcy trustee in toronto, bankruptcy trustee toronto, collection agencies, credit, credit counselling, credit score, consumer proposal, debt consolidation, rebuild your credit, starting over starting now, wages, bankruptcy trustee torontoA bankruptcy trustee Toronto understands that insolvency and filing for bankruptcy can be a very distressing time in someone’s life. Many people feel like failures at this time and need to have someone to whom they can turn to help them understand their options. People filing for bankruptcy can choose a federally regulated bankruptcy trustee Toronto they feel the most comfortable with to assist them in the process.

When Bankruptcy Becomes Necessary

When a person becomes insolvent, they cannot pay back what they owe to their creditors; in fact, what they owe may far outweigh the assets that they have. At this point, an individual may consider declaring bankruptcy. There are several clues, such as the following, that indicate that one is nearing this point of no return and should consult with a bankruptcy trustee Toronto:

▪ Garnished wages from each paycheque

▪ Contact from one or more collection agencies

▪ Utilities or household services that have been stopped from lack of payment

▪ You can no longer make ends meet living paycheque to paycheque

Bankruptcy and Its Benefits

Although it should be noted that bankruptcy is not the perfect solution for everyone because it will be quite costly and destructive to one’s credit score, it does have several advantages. Of course, there will be no more harassment from creditors or collection agencies during and following the bankruptcy process, and the person involved will be able to feel a greater peace of mind. In addition, many times people are allowed to keep their homes and property during bankruptcy. Finally, employers cannot discriminate against individuals who file for bankruptcy.

What a Bankruptcy Trustee Toronto Does

Anyone filing for bankruptcy in the GTA can choose the bankruptcy trustee Toronto they feel the most comfortable with to assist them. A bankruptcy trustee Toronto has numerous tasks. In general, the trustee is an impartial intermediary who will make sure that every part of the process is performed correctly, that there is no fraud and that assets are liquidated appropriately. Before the actual bankruptcy filing, he or she will meet with the person to review the individual’s situation, consider all alternatives to bankruptcy, including credit counselling, debt consolidation and consumer proposals.

After this initial assessment, if bankruptcy is the best option, the federally regulated bankruptcy trustee will explain the bankruptcy process to you, prepare and look over any paperwork before it is filed, if necessary will hold a meeting of creditors for the individual and will ensure that creditors are paid their pro rata share in accordance with the provisions of the Bankruptcy and Insolvency Act.

Some people fear that a bankruptcy trustee Toronto will make their lives miserable each step of the way. However, although the trustee may have some difficult and painful tasks to fulfill, they will ensure that each step of the process is performed thoroughly, accurately and with complete professionalism. Those people who are in a position to benefit from declaring bankruptcy will find the work of a trustee to be invaluable and allow you after your discharge from bankruptcy to rebuild your credit.

Bankruptcy Trustee Toronto

If you feel you are a candidate for bankruptcy, you can first do some self-study by reviewing our bankruptcy faqs. After reviewing the bankruptcy alternatives, if the best solution for you is bankruptcy, you should feel comfortable that your choice of trustee will treat you with the compassion and respect you deserve. Contact Ira Smith Trustee & Receiver Inc. and Starting Over Starting Now you’ll be on your way to living a debt free life.

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A GREAT CREDIT SCORE DOESN’T MEAN YOU WILL GET THAT LOAN

A GREAT CREDIT SCORE DOESN’T MEAN YOU WILL GET THAT LOANCredit score. If you’re not concerned about your credit score, you should be. Our lives revolve around our ability to access credit – car loans or leases, co-signing a loan for others, mortgages, rental agreements, lines of credit, credit card. In addition to affecting our ability to borrow, credit scores can impact our insurance rates and even our love lives.

What is a Credit Score? According to TransUnion, one of Canada’s largest credit reporting agencies, “A credit score is a statistically derived prediction of an individual’s credit risk at a particular point in time. Credit risk is typically defined as the likelihood of an individual becoming seriously delinquent (i.e. 3 payments past due or worse) within a 12-24 month period in the future). The score is a three-digit number that lenders use to help them make decisions. A higher score indicates that the individual is a better credit risk to a lender”.

I have always advocated to clients that having a good credit score is more of a risk/reward indicator for lenders as opposed to a true measure of “credit responsibility”. Credit scores don’t really evaluate credit worthiness, but instead whether a company can make a profit from the person. The good credit score they are looking for is in a range where you don’t pay things on time, but you eventually pay. That way they can charge interest, but feel comfortable that ultimately you will pay them in full. If you pay all your bills off in full and on time every month your credit score may indicate to the credit card issuer or lender that they may not be able to earn enough profit from you and therefore your credit score may not be as good as someone who carries a balance and pays the minimum every month. Although it may sound counterintuitive, having a great credit score doesn’t necessarily mean you’ll get that loan. However, it goes without saying that if you have a very poor credit score, then with certainty we can say that you will not obtain the approval of your banker. Unfortunately, there is not an online tool such as a Canadian credit score calculator.

If you’re having credit problems, it may be indicative of serious debt issues. Contact Ira Smith Trustee & Receiver Inc. today. Starting Over, Starting Now we can help you deal with your debt issues and restore you to financial health.

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THE 10 MOST COMMON CREDIT SCORE MISTAKES

canadian credit score calculator, credit score, credit scores, credit score mistakes, credit report, credit problems, credit history, bad credit, bankruptcy and insolvency act, bankruptcy alternatives, bankruptcy, consumer proposals, credit counselling, toronto bankruptcy, vaughan bankruptcy, trustee, woodbridge bankruptcy, what is bankruptcy, what is a consumer proposal, dave johnsonLast week we discussed how Your Credit Score Can Be Ruined Even If You Don’t Do Anything Wrong. This week we’ll be addressing The 10 Most Common Credit Score Mistakes.

What is a Credit Score? According to the Office of Consumer Affairs (OCA) “Your credit score is a judgment about your financial health, at a specific time. It indicates the risk you represent for lenders, compared with other consumers. Unfortunately, there is not an online Canadian credit score calculator tool.

There are many ways to work out credit scores. The credit reporting agencies Equifax and TransUnion use a scale from 300 to 900. High scores on this scale are good. The higher your score, the lower the risk for the lender. Lenders may also have their own ways of arriving at credit scores. In addition, lenders must decide on the lowest score you can have and still borrow money from them. They can also use your score to set the interest rate you will pay”.

What are the 10 Most Common Credit Score Mistakes?

1. Failing to check your credit report for errors: As we discussed in last week’s blog Your Credit Score Can Be Ruined Even If You Don’t Do Anything Wrong. Check your credit report at least annually. Mistakes on credit reports are more common than you may have imagined and you need to stay on top of the situation. If you do discover any errors, contact the credit bureau as soon as possible to correct the situation.

2. Not using your full legal name in financial documents: It’s possible that people with common names or similar sounding names could have their name attributed to a credit report that is not theirs, as was the case for Mr. Dave Johnson of Pembroke, Ontario. Use your full legal name on bank accounts, credit applications and other documents that become part of your credit history.

3. Paying your bills late and failing to make at least the minimum monthly payment: If you don’t pay at least the minimum amount due on time your creditors will eventually report your account as past due, which can damage your credit score. If there is a reason why you won’t be able to pay your bill on time, contact your creditor before your bill is due to work out an arrangement if possible.

4. Maxing out on your credit cards: If your credit cards are maxed out, potential creditors may question your ability to repay. If you are approved for a loan you may be charged a higher interest rate to compensate for what is viewed as a higher risk.

5. Not alerting creditors if you’ve moved: Your bill may arrive late and as a result your payments could be late, potentially damaging your credit score.

6. Registering for too many new credit cards: Consumers who often open new credit cards are viewed as a greater risk than those who don’t.

7. Closing older credit card accounts: Closing older credit card accounts shortens the length of your credit history and this can adversely affect your credit score.

8. Don’t co-sign for someone else’s loan: You could be liable for that person’s debt and damage your credit rating.

9. Don’t share your credit card or social insurance number with anyone: There are a lot of scams abound where people try by phone, email or mail to get your credit card or social insurance number. This can be a fast track to identity theft and financial disaster.

10. Ignoring the warning signs of credit problems: If you have trouble making the minimum payments on time and have maxed out all of your credit, you have serious debt problems.

Serious debt problems need professional help. Contact Ira Smith Trustee & Receiver Inc. and take the first step towards a healthy financial future. Starting Over, Starting Now a debt free life can be yours.

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YOUR CREDIT RATING CAN BE RUINED EVEN IF YOU DON’T DO ANYTHING WRONG

credit rating, credit score, collection agencies, collection agency, credit record, credit score mistakes, bankruptcy alternatives, Consumer Proposal, Bankruptcy, I came across this story not long ago about a man in Ontario who had his credit rating ruined by Rogers even though he has never had a Rogers account. I know this sounds unbelievable but Mr. Dave Johnson of Pembroke, Ontario has spent three years fighting a Rogers Bill that isn’t his. This story is a perfect example of why it’s so important that you are aware of your credit score and credit rating and check it periodically.

Rogers like many large companies outsources the collection of accounts that are in default to collection agencies. According to the Government of Canada you must be notified in writing that your file has been given to a collection agency. In this case Dave Johnson never received notification from the Rogers collection agency that his account was in default because he never had a Rogers account. Never-the-less, in 2010 he received a $5,400 bill from a Rogers collection agency working for Rogers Wireless. Mr. Johnson knew he wasn’t in arrears and contacted the collection agency letting them know that he didn’t have a Rogers account and that somewhere there was a clerical error. The collection agency seemed to be very reasonable and Mr. Johnson believed that the matter had been cleared up. Big mistake! The $5,400 debt to Rogers Wireless ended up on his credit record and as a result of this, leading to a poor credit rating:

  • He was turned down for credit cards.
  • He wasn’t allowed to co-sign for his son’s mortgage.
  • He couldn’t use the equity in his home.

In the process of trying to clear his name and restore his credit, and his credit rating, Mr. Johnson discovered that another man, also named David Johnson, has also been wrongly pursued for the very same bill. The reality is that the Rogers collection agency clearly didn’t have a file with accurate information of the debtor. They were going after anyone and everyone who had the same name, which unfortunately for the David Johnsons in Ontario, is quite common.

Rogers is not taking any responsibility for this problem. They are blaming the Rogers collection agency. In case you think that this is an isolated incident, CBC News received dozens of complaints last year about how collection agencies aggressively pursue unpaid debts. Howard Maker, Commissioner of Telecommunications Complaints, has confirmed that he is aware of this ongoing problem.

If you are being legitimately pursued by collection agencies because you’re experiencing serious financial difficulties and you are concerned about your credit rating, contact Ira Smith Trustee & Receiver Inc. We can help and Starting Over, Starting Now you will gain back your former quality of life. Watch for our next blog when we’ll be discussing Common Credit Score Mistakes.

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THE DANGERS OF JOINT CREDIT CARDS

bankruptcy and insolvency act and a joint account, debt, debts, credit cards, joint credit cards, credit card companies, bankruptcy, credit ratings, credit score, trustee, senior with credit card debtI recently met with a widow whose husband passed away deep in debt. Her late husband was very secretive about his finances and his widow only learned of how dire their position was when she became the executrix of his estate. After fending off collection calls relating to the estate, she learned she was liable for some of his debts. Why? Because her husband had applied for joint credit cards on his accounts, in his wife’s name. Needless to say, this woman, who never used the credit cards, was horrified to learn that she was now a senior with credit card debt rendering her insolvent.

It may seem pretty common for spouses to use a joint credit card, but consider the financial ramifications.

• Regardless of who incurs the debt on a co-issued credit card the primary and secondary card holders are jointly and severally liable. This means that the credit card companies view both parties as fully responsible for the entire account balance regardless of who is responsible for the expenses.
• If one card holder declares bankruptcy, the debts are enforceable against the other cardholder(s).
• Even if just one joint account holder acts irresponsibly, both credit ratings suffer. According to Clifton M. O’Neal, senior manager with TransUnion credit reporting, a 90-day delinquency can actually have a greater impact on an innocent party with relatively few accounts and no other credit infractions. The new delinquency may not make as much difference to the culprit’s credit score, if he/she holds other accounts with many more serious problems.

Joint credit cards may seem like a good idea for tracking expenses and collecting loyalty points, but they can also be a recipe for financial disaster. If you are experiencing serious financial problems as a result of a joint credit card, don’t delay. Contact Ira Smith Trustee & Receiver Inc. as soon as possible. We can help with your serious debt issues and Starting Over, Starting Now you can live a debt free life.

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THE RELATIONSHIP BETWEEN YOUR CREDIT SCORE AND INSURANCE RATES

Last week we took a light hearted look at how people are using credit scores to find love. This week we are discussing a more serious matter -the relationship between your credit score and insurance rates. Sadly many consumers have seen their premiums rise as a result. CBC-TV’s “Marketplace” spoke with several people who saw home insurance premiums double after their insurance company began including credit scores as a way to calibrate risk. How prevalent a practice is this? About 55% of Canada’s largest insurers now use credit scoring. And of that segment 42% did not disclose the practice to customers, according to the Canadian Council of Insurance Regulators.

The insurance companies who use credit scoring are trying to put a positive spin on it. According to Desjardins, insurance companies check your credit score only to offer you the best premium possible. The Cooperators offers a slightly different slant. “Credit score is simply a reflection of a person’s level of responsibility and behaviour when it comes to managing their financial obligations.” Donald Hanson of the National Association of Independent Insurers stated, “Research indicates that people who manage their personal finances responsibly tend to manage other important aspects of their life with that same level of responsibility and that would include being responsible behind the wheel of their car or being responsible in maintaining their home.” Cheap down payment auto insurance companies have found that there is a correlation between higher scores and safe driving but I have not seen the research to back up this claim.

Many disagree with the use of insurance credit scoring citing that a driver’s record doesn’t change with his/her credit score, nor does the area where their house is located. Therefore, there is no evidence that the risk factor will change with a high or low credit score. In fact credit scoring has been a controversial topic in Ontario as it is in other parts of the country. The practice is no longer allowed in some provinces, and some groups, including The Insurance Brokers Association of Ontario (IBAO) have been lobbying for several years to have it banned in Ontario. Whether you agree or disagree, the fact that insurance credit scoring exists only goes to show how important it is for all of us to maintain good financial health. Unfortunately, there is not a Canadian credit score calculator tool that anyone can use.

If your credit score is adversely affecting your life, contact Ira Smith Trustee & Receiver. Starting Over, Starting Now you can take the first steps towards financial health.

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GOOD CREDIT SCORES HAVE SEX APPEAL

credit score, credit scores, online dating, credit score dating, credit counselors, credit historiesWhat do you mean by good credit scores have sex appeal? We all know that if you want to borrow money, buy a house, purchase or lease a car…… you need a good credit score. But, did you know that now you may need a good credit score to find love? We live in the age of online dating and there are niche market online dating sites for just about everything – religion, age, weight, location, hobbies….. Now there are actually websites called CreditScoreDating.com and DateMyCreditScore.com for those who believe that a good credit score is a prerequisite for a good date. This is not a strange, “out there” anomaly; credit counselors report that many of their clients come to them because their romantic partners refuse to get married before they eliminate their debt. And, according to the New York Times, more people are adding credit scores to their social filters. People with poor credit histories, low scores, or no scores might be starting to find it more difficult to find long-lasting love.

In the 60s potential dates wanted to know your astrological sign. Now they’re asking for your credit score. Is this progress? Will the matchmakers of the future be financial planners and accountants? Do you think that credit scores should play a significant role in choosing a mate?

Contact Ira Smith Trustee & Receiver Inc. We’re not matchmakers, but if you have serious debt issues and a poor credit score, we can help. Starting Over, Starting Now you can live a debt free life and perhaps find love.

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TANK YOUR CREDIT SCORE RATINGS, DECLARE BANKRUPTCY, IMPROVE YOUR LIFE!

credit score ratings, bankrupt, Bankruptcy, Consumer Proposal, credit report, credit score, declare bankruptcy, insolvent, toronto bankruptcy, vaughan bankruptcy, what is bankruptcyAre you the poster child for financial responsibility? You have a good job, you take care of your family, your bill payments are all current and you have an excellent credit score. So, what can possibly be wrong with this picture and why would we think you should tank your credit score ratings, declare bankruptcy and improve your life?

The reality is that as many as 70% of bankruptcy filings are made by people with strong credit scores, according to TransUnion. Why isn’t a great credit score a predictor of whether or not someone will go bankrupt? “Many people are hopelessly insolvent but they’re not delinquent. From a credit report they are making their payments on time but they’ve got no reasonable prospect of ever paying this debt off,” said Mr. Mantin, senior vice-president of E. Sands & Associates Inc. According to Ira Smith, President of Ira Smith Trustee & Receiver Inc., “This is a very telling comment. Most people believe that as long as you make the minimum payment, you are “current”, especially when it comes to credit cards, even though deep down you know that you will never be able to pay off the debt. Current used to mean that when you received the credit card statement, you paid off the balance in full and you were delinquent if all you made was the minimum payment. This is a huge societal mind shift.”

When you are staying afloat by making the minimum payments, it doesn’t take much to tip you over the edge. Any major life changing experience can do it – loss of job, divorce, serious health issues, unexpected major expense – and all of a sudden you go from paying your bills on time and having a great credit score to not paying your bills and looking at bankruptcy.

What should you do? If you are struggling with a mountain of debt, even if you are making your monthly payments and have a great credit score, contact Ira Smith Trustee & Receiver Inc. A great credit score won’t solve your debt problems, but a consumer proposal or bankruptcy can help you both financially and emotionally, alleviating the monthly stress when the bills are due. Starting Over, Starting Now you can take charge of your financial future and improve your life.

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SHOULD SOCIAL MEDIA BE USED TO DETERMINE YOUR CREDIT SCORE?

bad credit, Bankruptcy, bankruptcy alternatives, Bankruptcy and Insolvency Act, bankruptcy in Canada, bankruptcy in ontario, bankruptcy ontario, bankruptcy protection, bankruptcy trustees, Consumer Proposal, consumer proposals, credit report, credit score, credit scores, debt management, debt settlement, declaring bankruptcy, Facebook and LinkedIn, social media, social networks, what is a consumer proposalAre you experiencing problems with debt management or having trouble getting credit due to a bankruptcy or a consumer proposal? If so, you are going to be delighted to hear that there are companies who believe that online reputations can tell lenders more about a person’s trustworthiness than the traditional credit score. Your credit score is established on the basis of how you pay your bills while companies like Lenddo and Neo Finance are analyzing data from social networks like Twitter, Facebook and LinkedIn, and other factors to reach people who have a hard time getting loans. The Lenddo score is based upon:

  • Number of followers
  • Background of peers
  • Education and employers
  • Repayment history of friends

The Neo Finance score is based upon the following information in a person’s LinkedIn profile:

  • How long the user has held jobs
  • The number and quality of connections in their industry
  • The seniority of their connections

Should social media be used to determine your credit score? Probably not. Basing anything on the number of social media followers is categorically unreliable. Social media networks have become a numbers game where there is the mistaken belief that “whoever has the most, wins”. Fake Twitter followers have become a multi-million dollar business. Open networkers on LinkedIn have thousands of followers that they don’t know and the same goes for people who collect Facebook friends. The other problem is that the consumer would have to be willing to connect the financial service to their social media networks’ data which of course brings up privacy issues. Although in theory, this sounds like an interesting idea, I’m afraid that there is no quick fix for bad credit.

If you are experiencing problems with debt management or having trouble getting credit due to a bankruptcy or a consumer proposal, contact Ira Smith Trustee & Receiver Inc. for information on how to fix bad credit so that you can live a debt free life Starting Over, Starting Now.

Call a Trustee Now!