What is a Credit Report?


3 minutes - Article

Throughout your life, you build a credit history. This credit history is reflected in a credit report.

Manraj Waraich is a Financial Educator at the Credit Counselling Society.

“A credit report will summarize your credit history,” says Manraj, “It contains information based on what you have done in the past when it comes to your debt. So lenders, landlords, employers and insurance companies use it to verify information about your borrowing activity and your repayment history.”

Score good credit!

Based on your credit report, you will get a credit score.

“There's always a difference between your credit report and your credit score. The credit score, on the other hand, is based on information that's in your credit report. And it's going to be used by lenders to predict how likely we are to repay back any future debts.”

Know what you are signing up for

Manraj says it’s important for youth to know exactly what they are signing up for when they apply for credit, including interest, fees and the repayment schedule.

“If we don't understand exactly what we're signing, we don't have to sign it. We can take time to walk away in order to understand exactly what fees are going to be involved.”

When you have debts, make minimum payments each month and try to pay it off as quick as possible. This will end up saving you money in the long run - and look good on your credit report.

“If you don't pay the minimum, you can be charged additional fees and it ends up reflecting poorly on your credit report and credit score. And that may result in less borrowing capacity in the future”, says Manraj.

Related Resources