5 ways to rebuild your credit!

Door To Door Auto Sales

How to buy a car in Canada

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We understand that bad things happen to good people. Unexpected circumstances can arise, and it can be tough to keep up on your financial obligations. Here are some simple ways to improve your credit and strengthen your overall financial profile.

1) Catch up on your existing payments

This is sometimes easier said than done. However, when applying for a new loan, the bank will want to make sure the payments are up to date on any existing loans you may have before they grant further credit.

2) Re-establish by getting a new piece of credit

If you’ve gone through any rough patches in your credit history (written off accounts, late payments, repossessions, bankruptcies, etc.) the bank will likely want to see some form of “re-building”. This would be a well-paid piece of credit that was obtained after any delinquent credit. New credit helps to show you’ve learned from any previous mistakes and are paying your current obligations well.

3) Have a co-signer lined up

A co-signer is a good way to provide a little extra security for the bank. This person can be anyone from a spouse, a friend, a family member, or even a co-worker. If they are receiving an income, the banks will consider their application. Some banks even offer to remove the co-signer after a certain amount of time on the loan, assuming the buyer has made all the payments on schedule.

4) If possible, try to put some cash down on your next loan

A cash commitment to the loan can increase the likelihood of an approval because it gives the bank equity in the asset being purchased (meaning the loan is for less money than the asset is worth). Equity in the loan makes the application more appealing and can sometimes act as an incentive for the bank to approve an otherwise risky loan.

5) Limit the number of people who look at your credit

Each credit inquiry will impact your credit score, so it’s best to keep this to a minimum when trying to rebuild. As an alternative, most banks can show a partial credit report using your online banking that will not count as an inquiry and will still allow you to monitor your progress.

Here at Door to Door Auto, we understand that every situation is different. We’re happy to provide free credit counselling for those wanting specific advice on how to increase their credit score. Feel free to reach out to us anytime at 1-855-829-8408!

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