Your credit score may be the most important number in terms of your financial wellness. However, did you know that the average person isn’t aware of what their current credit score is or how it even works? Let’s be honest, it probably isn’t something that pops into your daily conversations or conscious mind even. If you are like most people, chances are you only look at your credit score if you are in the process of applying for a mortgage for a home, a loan for a new car or maybe a credit card. Believe it or not, it is something you should know about and actually check on a regular basis. Here are two reasons why it is a good idea:
Financial Health – It is important to know where you stand with your credit score at all times, not just when you need it. Think of it as an important part of your financial health. You wouldn’t ignore certain aspects of your physical health if you were trying to maintain your overall health, so why do it financially? By monitoring your credit score on a regular basis, you will be accountable for your spending habits and feel more in control of your finances. You will be able to quickly see if your score has gone up or down and if necessary, take steps to improve it. You will essentially be keeping your credit score “healthy” by keeping an eye on it.
Accuracy – It is possible for errors to happen on your credit report. Left unchecked, these errors could result in you being turned down for a mortgage or credit card. They could also be an indication that someone may be trying to steal your identity by opening credit cards and loans in your name. Errors can range from mistakes in your personal information (incorrect date of birth or mailing address) to credit card accounts (think a payment made on time, but showing as “late”) or even accounts listed that you never opened (possible sign of identity theft). By checking your credit score at least once a year, you will be able to see if there are discrepancies and swiftly take action to correct any mistakes with the credit bureau or begin steps to repair or improve your score. If there is an issue with your credit, it won’t go away overnight. It takes time for a credit score to recover.
Remember, your credit score is a record of how well you manage credit. It is used by lenders to assess your risk and financial health. We can’t stress enough the importance of ensuring the information on your credit report is accurate. If you are worried that checking your credit score will have a negative impact, don’t be. Both Equifax and Transunion offer credit reports that are considered to be “soft hits” and do not affect your credit score.
Do you have questions about your credit score or how it affects your eligibility for a mortgage? For a free, no obligation consultation, please contact one of our trusted professionals by phone at +1-204-326-4479, +1-877-282-0904, by email at save@vssolutions.ca or visit our website https://vssolutions.ca/en/