building credit while abroad
 

I want to start building my credit before moving to Canada. I opened a savings account with Canada Trust TD last year but didn't put any money because they said they may close the account if there's no regular activity.

I am thinking of opening a tax free savings account (min 5000 dollars I think which is fine by me) but does anyone know how they compare to accounts offered by offshore banks in Isle of Man etc? I checked a few online but interest rates look pathetic. May be I didn't look at good ones. Any thoughts on tax free savings accounts?
I will be in Canada around Christmas, so thinking of opening an account while I am there this time.

Thanks for you help in advance.

Cheers

Re: building credit while abroad
 

as far as im aware having a savings account has no impact on your credit in canada

the only way to establish a credit history is to actual have some credit

eg you need some sort of borrowing eg a credit card loan or mortgage nothing else will start to build a credit rating

good luck

Re: building credit while abroad
 

I agree- credit histories are built by being given credit by a bank or another financial institution. A savings account is not credit, so won't help you.

A good credit history is built up by you using the credit facility offered to you (credit card, loan, mortgage) and managing it carefully.

So:
1. A credit card you don't use is better than just a bank card. (a bank was willing to offer you credit, so considered you somewhat credit worthy)

2. A credit card you use regularly and pay off your debts as agreed is better still. Activity on a card, or regular, steady payments towards a loan are what banks want to see on your credit history when considering your credit worthiness.

3. A credit card you use and don't pay off is worse than the first two. Bad credit is worse than no credit at all.


I'm looking to do something similar at the moment. I have just applied for a basic credit card with RBC (Visa), which I will use to make some small purchases on before arriving in BC, like Christmas presents, etc.
If you're going to try this, think carefully about how good you are at managing your financial matters- if you're likely to forget to pay off this card one month, you'd be better off not setting it up in the first place. Poor credit is worse than no credit at all.

Re: building credit while abroad
 

If you get any form of credit and don't use it, it is of little or no use in building a credit history.

The only way is to take out a credit facility, cards, mortgage, utility bills etc. and paying them off regularly.

Making multiple applications for credit can hurt your credit rating, as can making an application and being turned down.

Having a bank account helps build your relationship with the bank, which can be of some use.

Re: building credit while abroad
 

please note untily bills dont help credit history in canada
I specifically asked this myself as I know they do affect UK history but not canadian

just like to say though if you are concerend about getting a credit card in canada we got a credit card with scotia bank with no bother and we are only here as visitors, we got one soon after arrival.

Re: building credit while abroad
 

That is not what we have been advised from our bank, they do count on ours :huh:, plus you have to use the credit card regular and pat off to get the good rating.
Also anything you buy on buy now pay later can affect your rating as well, better to speak to your bank when you decide who you want to go with.
Also our bank will look at our rental payments as well when we come to get a morgage.

If it is any help, we help an account with RBC for 12mths before we landed, they was really helpful when we got here :thumbsup::thumbsup:

Re: building credit while abroad
 

Hey was just wondering if you used a Canadian or UK address when applying for the credit card with RBC? I was hoping to apply for one before I arrive but don't have a Canadian address as yet so didnt think it was possible.

Cheers

Re: building credit while abroad
 

It is a maximum of $5,000 per person per year, but it is only available to people who are resident in Canada for tax purposes.

Re: building credit while abroad
 

I cheekily used a Canadian address.
Actually, my situation is probably a bit different to most people here.

I used to live in Canada, and my parents still do. I've had an RBC savings account for, I don't know, 20 years? I moved away from Vancouver 13-ish years ago, but never told RBC, and the account stayed dormant. As my parents still live at the same address it didn't matter, they just kept the statements for me.

When we decided to move back to Vancouver, I contacted my 'home' branch of RBC in Vancouver and explained the situation- that I have been away, but am moving back in a couple of months, and need to set up internet banking for the account, etc.
She asked if I wanted to change the address on the account, and when I asked if I had to change it she said, no, probably not, if your parents are happy to keep receiving the statements for another two months.
So the Vancouver address is still my 'home' address as far as RBC are concerned. When I applied for the credit card online, it never asked for my address, as I was logged in to their secure server, so I guess it just pulled my address from my file.


I'm not sure all of that helps you though.
:huh:

Re: building credit while abroad
 

If the companies report to the bureaus, then they affect your credit rating, which many utility companies do.

Re: building credit while abroad
 

Is there such a thing as the Electoral Register in Canada?

I mean, obviously there is, for voting purposes, but does it affect your credit worthiness?

When I moved to the UK 12 years ago I had trouble getting a mobile phone contract and other stuff.
Turns out it was because I wasn't on the Electoral Register, so didn't really exist at my address. It's one of the things used for a credit check.
Once I'd filled out the form with my local voting office stating my address, I could have all the mobile phone contracts I wanted.


Is there a similar link with credit checks in Canada?
And if there is, how would one go about getting ON the register?

Re: building credit while abroad
 

this is what I thought must happen same as Uk but was told by scotia bank that uitilty biils and paying home tax does not affect credit rating must admit I thought it a bit weird myself:unsure:

we pay all biils upfron eg a years home tax, always at least $200 in credit for elec and phone and net but this was irelavant accoring to scotis bank

but as I say we got a VISA anyway with no status here ( only visitors) and neither of us in work so no prob at all

Re: building credit while abroad
 

Property tax and utilities (water & garbage) to a municipality won't affect credit rating as they don't report to the bureaus. If you don't pay they charge lots of interest, then they will eventually seize your house and auction it off. A good incentive to pay. Electric & Gas companies mostly report to bureaus.

Re: building credit while abroad
 

No, being on/off the elctoral register has no influence on your credit rating. Only Canadian citizens are on the electoral register.

If you want to establish a good Canadian credit rating you have to borrow money (or buy things on credit) and pay it back on time.

Re: building credit while abroad
 

Cool.

Ok, thanks.