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Best way to build up credit history

Best way to build up credit history

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Old Apr 17th 2018, 7:40 pm
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Default Best way to build up credit history

We are currently waiting for our Family Sponsorship to begin, forms all gone into CIC, staying here with my mum, 3 months Canada, 1 month in UK, 3 months Canada etc etc; until we can get Permanent Residence (fingers crossed!).

I work as a consultant and we rent out property in the UK, so our family income is around £40k per annum.

We have had a Canadian bank account for a few years as we started to save money in it over the last few years in preparation. Since we have been here we have been spending the money, and now have a truck with the insurance is paid direct debit monthly from the bank account, but how can be get started on a credit history?

My mum says when she first came you could get a store card without permanent residence, but would this give us a credit history? I'd prefer to get a credit card with some sort of benefits that we would use, such as WestJet.

Has anyone gone through this process and would have any advice?
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Old Apr 17th 2018, 7:57 pm
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Default Re: Best way to build up credit history

Store cards used to be easy to get so was the easiest way to start - that and phone plans. Not sure if it's still the case.
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Old Apr 17th 2018, 8:31 pm
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Default Re: Best way to build up credit history

First stage is to get a credit card. If you have zero credit history in Canada, you may have to get a secured credit card, which means you deposit the credit limit in a savings account and it is locked. You then use the credit card in the normal way. Pay it off in full on time, every time, for a year and the bank will likely convert it to a normal, unsecured credit card. Use it for bloody everything - even if it is a small coffee.

Not sure if you could still get a newcomers package at one of the banks, as they usually have decent credit card offers as part of it.

If you have an Amex in the UK, you can transfer it to Canada and have a nice, shiny, unsecured card ready to rock straight away.
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Old Apr 17th 2018, 8:37 pm
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Default Re: Best way to build up credit history

The best, and possibly the only way, is to get a bank credit card and use it, paying off the money after you get the statement but before the payment date.

You need to get the record of being a responsible person on record at the credit recording agencies, and it has sometimes seemed that paying before the statement arrives may not do the job.

An alternative would be to take out a loan from the bank, and pay it back on schedule.

Store credit cards are no longer as easy to get as they used to be .......... in fact, it seems that most stores use a financial company to run their credit card business.

I have a Bay credit card and payments for that have been going to Capital One for some time. Late last year I got a letter from Capital One telling me that I could no longer pay by cheque at a Bay store, as I have done for several years. I could use only cash or a debit card.

I have never missed a payment, not had a cheque bounce in more than 30 years of doing that! However, that letter came just a few months after I had started doing internet transfer to the account.
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Old Apr 17th 2018, 9:15 pm
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Default Re: Best way to build up credit history

Originally Posted by Tumbling_Dice View Post
If you have an Amex in the UK, you can transfer it to Canada and have a nice, shiny, unsecured card ready to rock straight away.
Really? Didn't know that... I have an Amex card so transferring it seems the best way forward, plus you get free lounge entry!
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Old Apr 17th 2018, 10:22 pm
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Default Re: Best way to build up credit history

Originally Posted by sidjoloo View Post
Really? Didn't know that... I have an Amex card so transferring it seems the best way forward, plus you get free lounge entry!
Really. We did it.

We went without a car for a year and then, when we decided we really needed one, decided to finance it. We got approved by one of the main lenders on good terms so the credit card method is the way forward.

I would echo what is said above in terms on paying on time.
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Old Apr 18th 2018, 10:58 am
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Default Re: Best way to build up credit history

Several years ago my banking officer (Scotia) pointed out to me that I didn't have a credit rating, despite having been here for years. Everything was in my wife's name, including our Desjardins credit card and the various utility bills.

He suggested a low-cost and fairly basic credit card. I use it a lot and always pay on time. My credit score is now very good.
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Old Apr 18th 2018, 8:18 pm
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Default Re: Best way to build up credit history

Originally Posted by Souvy View Post
Several years ago my banking officer (Scotia) pointed out to me that I didn't have a credit rating, despite having been here for years. Everything was in my wife's name, including our Desjardins credit card and the various utility bills.

He suggested a low-cost and fairly basic credit card. I use it a lot and always pay on time. My credit score is now very good.

I've been in the reverse situation ........ no credit rating based on household bills because they were all in my husband's name , even though I was writing the cheques and signing in my name when paying the bills.

There was another aspect to these bills being solely in OH's name only .............. I often couldn't get information from eg the electricity or phone company, because "we have no record of your name, and we cannot release information to anyone who is not named on the account." Privacy reasons were always claimed!

My name is now added to all accounts, but the statements come addressed to my husband only.

I've had a basic no-fee Visa card since about 1978, and a Bay card since the early 1970s, both in my name only (no secondary cards), so I had a credit rating based on those 2 cards. I was lucky to get both those cards in my name back then ............. women often were denied cards unless their husband or father were also named .

I was fortunate that I had a bank manager who believed that a woman should be able to get a card. He even gave me a limit that was higher than on our joint MasterCard where OH was the primary owner ........... and that continued for many years. At one point, my limit on the Visa was higher than my annual income, before tax!

Now think of a further possible problem ........ you sometimes cannot easily get a cheaper rate on eg a landline phone or Hydro if you separate from the spouse who has the accounts. The companies may require that you have 12 months record with them before they will put you on the Equalization Payment Programme ......... it's like going back to the very beginning of your time here!
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Old Apr 19th 2018, 7:51 am
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Default Re: Best way to build up credit history

My recent new arrival experience was that BMO gave me an unsecured credit card with a $2,000 limit. Personally I would have preferred a secured card with a higher limit (we were prepared to tie up some cash for 12 months), but such is life.

We're now trying to run up a monthly balance of around $600 to $1,000, and paying that off after the statement is issued but before the due date. My research suggests that repayment history and responsible use of credit can affect one's credit rating. We could spend more on our Canadian card, but we're trying to demonstrate responsible credit use (we still have our AU credit cards, so we're not short of credit).

I'm still tossing up about whether I transfer my AU Amex (credit, not charge card), instead of just waiting and then applying for Canadian Amex. My AU Amex has a very high credit limit and my guess is I won't get the same limit if I transfer it. Having that limit has come in very handy a couple of times (I bought a car on my Amex once - really - OK it was only a Honda Civic, but the rewards points were very nice; and paying for a very costly (but worth it!) holiday to Antarctica.

scilly and Souvy make good points about having independent credit ratings, and making sure that things like utilities are in joint names. My spouse and I had been less than diligent about our household utilities being in our joint names and when we applied for spousal sponsorship and we had to supply proof of the marriage (we're childless), we were like "doh", all the key household utilities are in my spouse's name (and he's the Canadian sponsor!). Fortunately it turned out that a telephone account and an insurance account were in joint names, so our marriage was real and could be proved with evidence after all!
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Old Apr 19th 2018, 3:48 pm
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Default Re: Best way to build up credit history

Do bear in mind that a credit rating (from one of the credit reporting agencies) and your credit profile with a bank or financial institutions can be different things. Having a good credit rating is one thing but banks are businesses and so want to make money off you.

If you take out a credit card with a bank and pay it off every month in full, thereby never paying the bank any interest, you may find the bank is less reluctant to lend to you despite the credit agencies giving you a good score. I tend to underpay the full balance on the credit by about $100 2-3 times a year (despite having the funds to pay the total) so that banks gets $20 a few times a year.
Other ways of building credit are cell phone accounts, utility accounts etc.
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Old Apr 19th 2018, 5:27 pm
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Default Re: Best way to build up credit history

I'm sure the situation is probably a bit different now, post-2008 and all, but when I arrived in 2006 it was suggested that financing or leasing a vehicle, rather than paying cash, was a good and quick way to build a history, so I did that.

I was on an intra-company transfer so was also able to demonstrate continuity of employment to my Canadian bank, which got me an unsecured credit card having at first been told I'd need to provide security. Again, things may have changed in the intervening decade or so...
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Old Apr 19th 2018, 6:22 pm
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Default Re: Best way to build up credit history

Originally Posted by MelVan View Post
scilly and Souvy make good points about having independent credit ratings, and making sure that things like utilities are in joint names.
If the utility company will do it. Ontario Hydro and one other band of antediluvians would not put two names on the account when I asked (around 2014). Why they think you need a penis to ask about the latest power failure I cannot imagine.
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Old Apr 19th 2018, 6:32 pm
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Default Re: Best way to build up credit history

Originally Posted by dbd33 View Post
Why they think you need a penis to ask about the latest power failure I cannot imagine.


Quite a few ways that line can be read... gave me a good laugh on a rather dull, boring day.
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Old Apr 19th 2018, 8:31 pm
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Default Re: Best way to build up credit history

Originally Posted by dbd33 View Post
If the utility company will do it. Ontario Hydro and one other band of antediluvians would not put two names on the account when I asked (around 2014). Why they think you need a penis to ask about the latest power failure I cannot imagine.

BC Hydro and Fortis Gas both added my name to the account as someone who had the authority from the account holder to ask questions and receive answers.

The statements all come addressed only to OH, so I guess my name isn't ON the accounts in the strictest terms. I didn't fuss too much about that as I had other proof of joint ownership and credit rating. I even have joint ownership of the car when I don't even have a driver's license

At least I can ask about why they have just mailed (yes, mailed) a letter to OH saying they had urgent information to give him!


As far as power failure ...... we just dial a certain BC Hydro number on a cell phone or landline, and get the information electronically.
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Old Apr 19th 2018, 8:36 pm
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Default Re: Best way to build up credit history

My wife had existing accounts with hydro, shaw and so on, so its all in her name. I am on the account as someone who can call and talk about the accounts though, but as the other poster said, nothing comes in my name.
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