Enrolling in a debt management program (DMP) will help you to repay your credit card debt and set you on a path to a healthy financial future. Through financial literacy education you will learn how to budget, live within your means, put savings in the bank and change your attitudes towards money and spending behaviours. The only thing left will be to start building a positive credit history.
Why do you need a positive credit history? Well, perhaps you would like to rent a new apartment or buy a car. It’s only by pulling your credit report can landlords and lenders assess risk in terms of your ability to pay rent or repay a loan every month.
Now you know why you need to establish a credit history; how to establish one is next.
The easiest way to establish a credit history is by purchasing a secured Visa or MasterCard at your local financial institution. With a secured credit card you are charged interest, required to make monthly payments and your payment history is reported to the credit bureaus.
Start small, perhaps with $500, and be diligent about making regular monthly payments. By meeting your monthly payment obligations, a secured credit card can help rebuild your credit scores.
Another, perhaps more effective way, to establish credit is by working with a trained credit counsellor to find ways to resolve your financial challenges, better manage cash flow and improve your credit rating.
Improving your credit rating
A credit counsellor can help you improve your credit rating by providing you with coaching and customized strategies to help you manage your credit profile and improve your credit score. In addition to helping you overcome the obstacles in obtaining financing or lower cost borrowing, your credit counsellor will work with you to:
- Understand what your credit score means and why it is so important
- Understand the requirements of the various lenders
- Understand the seven credit mistakes that no one can afford to make
- Determine the actions necessary to improve your credit score over time
- Help you to improve you credit profile
- Maximize your credit score in the future
Owning a home
Regardless of your credit profile, our counsellors can help you manage your cash flow and credit so you can achieve your goals of home ownership. Together, you can develop a customized “game plan” to help manage your finances and enable you to qualify for the best possible mortgage terms to purchase or refinance your home.
Finding finance alternatives
A trained credit counsellor can also help you explore the most beneficial financing options for automobiles, mortgaging, equity lending, credit cards, and credit rebuilding with lenders who understand your credit situation.