What to do, in what order, and why each step actually moves your score. Written for people in BC who've had a rough patch with credit, are new to it, or just want a better rate next time.
By Anders Ponton, Financial Services Manager, Go Kia Richmond ·
Your score is a lender's shortcut for one question: will this person pay me back on time? In Canada, Equifax and TransUnion build it from five things, and they don't count equally:
1. Payment history, the most important part. 2. How much of your limits you use. 3. How long you've had credit. 4. How often you apply. 5. The mix of credit you have, like a card plus a car loan.
Every step below works on one of those five. That's why it works: you're not chasing tricks, you're giving the bureaus new proof, month after month, that you pay.
Get your free report from Equifax and from TransUnion online. Checking your own report or score does not lower it. It's a "soft" check that only you can see.
Why it works: the two bureaus don't always hold the same information. You can't fix what you can't see, and you'll walk into any application knowing exactly what the lender will see.
An account that isn't yours, a debt you paid that still shows owing, a late payment that wasn't late. Dispute it with the bureau that shows it, in writing, and keep a copy.
Why it works: an error counts against you exactly like a real problem. Removing one is the fastest score change there is, because nothing about your habits has to change.
Note your score and the date. Equifax gives you a free score online. Many bank apps show one too.
Why it works: bureaus update at least once a month. With a starting point, you'll see each step pay off, and you'll know when you're in a better spot to apply.
Set every bill to come out automatically the day after you get paid. If you can't pay a card in full, pay at least the minimum.
Why it works: payment history is the biggest part of your score. Every on-time month adds a new line of proof, and autopay takes forgetting out of it.
If a payment is going to be tight, call the lender before the due date and ask what they can do.
Why it works: a missed payment can sit on your report for years. A phone call before it happens often costs you nothing.
On a $5,000 limit, that means owing less than $1,500 when the statement prints. $1,000 is 20%. Pay it down before the statement date, not just the due date.
Why it works: a card near its limit looks like stress to a lender, even if you pay it off every month. Low balances say you have room and don't need it.
A secured card works like a normal credit card, except your deposit becomes your limit. Before you sign, ask if it reports to Equifax and TransUnion.
Why it works: you can't build payment history without something to pay. A small card used for one bill and paid on autopay builds it quietly.
Don't close an old card just because you paid it off, especially one with no annual fee. Use it once in a while so it stays active.
Why it works: how long you've had credit counts. Closing your oldest account erases history and lowers your total available credit at the same time.
Every application is a "hard" check, and it stays visible on your report for about three years. Several close together make lenders think you're desperate for credit.
Why it works: fewer hard checks means fewer red flags. For a car loan, quotes from different lenders within about two weeks count as one inquiry. That's why one application to one person who shops it for you beats five applications at five dealerships.
A card alone is one type. A car loan is another kind: a fixed payment for a fixed time. Only take on a payment you can carry every month with insurance.
Why it works: having more than one type of credit can help your score. A bigger debt than you can handle does the opposite, so the budget comes first.
A car loan paid on time for 12 to 24 months is one of the strongest rebuilders there is. Yes, that includes bad-credit car loans. They report to the bureaus like any other loan.
Why it works: it adds a new type of credit and a fresh on-time payment to your history every single month. Two of the five score factors move at once.
Start this step now: apply in two minutes at approvedbyanders.ca/apply. One application, and I shop it to the lenders for you.
Look at your free score once a month. Is anything new on the report? Are the card balances still under 30%?
Why it works: the bureaus update monthly, so a problem caught in month 3 is cheap to fix. One you find in month 12 has already cost you.
Most people think they need 12 months of rebuilding before a lender will say yes. Often that's not true. I work with 30+ lenders, and many look at your income, your time on the job and your real budget, not just the score. A car loan can be step 11 of your plan instead of the reward at the end.
Apply once and I'll tell you honestly where you stand. If it's not the right time yet, I'll tell you exactly what to fix first. Either way, you leave with a real answer.
Rather talk first? Message me on Instagram @approvedbyanders or email aponton@goauto.ca.
One application, one real person on your file. Anders Ponton, vehicle financing, Go Kia Richmond. Serving all of BC.
On approved credit. Anders Ponton is a representative of Go Kia Richmond, 5660 Minoru Blvd, Richmond, BC (Dealer #50655). Terms and rates vary by lender and credit profile; submitting an application does not guarantee financing. This guide is general information, not financial advice. Credit-score facts are from the Financial Consumer Agency of Canada (canada.ca).