Credit Reports

	Credit Reports - Money Problems Radio Show (Opens in a new window. Optimized for Windows Media Player 6.4 and later versions.)
Originally aired on February 4, 2006.

Show Topic:

Many Canadians realize how serious their money problems are when they try to borrow money, but the bank says "no" because of negative information that appears on their credit reports.

On today's show we are going to talk about credit reports. What are they? Where does the information come from? How can you build a good credit rating? What can you do if you have a bad credit rating?

Guests:

Douglas Hoyes and Ted Michalos are the founders of Hoyes, Michalos & Associates Inc, one of Ontario's leading personal insolvency firms. They emphasize a "fresh start" when dealing with money problems. They can be reached at www.hoyes.com or, in Ontario, at 310-PLAN (no area code required).

Show Summary:

According to Equifax, your credit file is a report of your financial history and performance with credit grantors. Credit reporting agencies are private company that gather credit information about you, to help lenders decide whether or not to grant you a loan.

Your credit report includes personal identification information, information from various creditors, credit inquiry information, and legal items, such as past bankruptcies.

Credit ratings range from R1 (perfect credit) to R9 (the worst credit rating).

Question of the Week:

Q. I went to get a debt consolidation loan and the bank declined me because of what's on my credit report. I've moved around a lot and lost track of some of my debts. I got a copy of my credit report and it shows that I have a lot of past due debts. What can I do to repair my credit?

A. The problem is not that your credit report looks bad; that's just a symptom. The real problem is that you have more debts than you can handle. Here are some options.:

	The first option would be personal budgeting: determine if you can deal with these debts on your own. If you owe $100 on a past due phone bill from three years ago; the solution may be simple: contact the phone company and pay the bill.
	If the debts are too large to deal with on your own, a credit counsellor may be able to help you work out a plan to repay your debts. They can also help you with budgeting to get back on track.
	A consumer proposal is an option to help you deal with your debts. You get the time required to repay all or a portion of your debts.
	If your debts are too large to deal with on your own or through a credit counsellor or a consumer proposal, you should consult a licensed bankruptcy trustee to explain your options, and to help you get a fresh start.

Here are some great links to help you:

	Information about credit reports
	Information about debt management plan
	Information on how to file a consumer proposal
	Information on personal bankruptcy and Ontario bankruptcy laws