CU Tip: Credit Repair

Beware of the quick fix.

You often see ads on television or in the newspaper promising a quick fix for poor credit ratings. The truth is, no credit repairer has the power to change or erase accurate information in a consumers credit bureau file.

Generally, your credit file contains a listing of debit and credit payments and it includes public record information about how promptly you pay your bills, collections, judgements and bankruptcies. Lenders update this information monthly. If you question an item on the file, the credit bureau will investigate and if an error is found, they are obliged to correct it.

Since December 2000, Ontario has made it illegal for credit repairers to accept advance payment, or to charge a fee at all unless their services demonstrably improve the consumers credit file. Aside from ensuring all the information is correct in your file (which you can do yourself), the only sure way to improve a poor credit rating is to work with creditors and show that your payment habits have improved.

It is in your best interests to check your credit files every two years to ensure the information is correct. Your personal credit report is free if it is sent to you via Canada Post or you can pay a fee to access it online. Contact one of the two major credit bureaus in Canada: Equifax Canada Inc. (www.equifax.ca) or Trans Union of Canada Inc. (www.tuc.ca).