Review All of Your Options to Get the Best Credit Repair Help in Edmonton
There are some companies who are selling costly credit repair services in Edmonton that sadly, often leave people struggling to pay more debt than they started with. Based on how much they charge for these services, it’s likely a lot of people would expect to receive a lot more value than what they actually receive. What’s also surprising is that services like this can possibly make someone’s credit worse if they are unable to make all their payments, and their new credit repair loan is sent to collections. Although this may be unnerving, here is some good news: you can repair and improve your credit score in Edmonton for free – and even get more one-on-one help and better advice than a good number of credit fixing companies provide. Keep on reading, and we’ll tell you how to get this.
How to Fix & Repair Bad Credit for Less Than Credit Repair Companies, Services, & Agencies
The goal of credit repair companies and services is to help people improve their credit score – often claiming to be able to improve it quickly. The way many of them appear to do this in Canada is by offering credit building loans. The idea is that this loan will create some new good credit on your credit report and show the credit scoring system that credit is available to you and that you are using it responsibly.
This approach undoubtedly helps a fair number of people improve their score, but we think that it comes at much too steep a cost for many consumers. A credit building loan ensures that a company can charge someone interest and fees every month over many years. But there is a better, cheaper, and more effective option.
Advantages of a Cash Secured Credit Card Versus Credit Building Loan to Improve, Restore or Fix Your Score
The faster and better way to fix, improve, or restore your credit score, compared to a credit rebuilding loan, is by getting a cash secured credit card. The way they work is you put down as much money as you would like your credit limit to be. Some cards require as little as $250 or $400 to get you started. They then function as a normal credit card.
Cash secured credit cards have a number of advantages over credit rebuilding loans. Here are four of the biggest:
- As a revolving type of credit, a cash secured card will improve your score faster than a loan as long as you don’t carry balance equal to half of your credit limit or greater.
- Most credit repair loans have fees and interest that you pay monthly with your payment. A secured credit card only has one yearly fee, and you don’t have to pay any interest if you pay off what you owe every month in full.
- It is much easier to afford because you don’t have to create some room in your budget for a monthly loan payment and/or a service fee. You can instead use your card to pay for something that you've already included in your monthly budget: gas for your vehicle or a monthly transit pass. You can then pay off your card balance in full when you receive your bill. You don't end up spending anything extra since you were likely going to buy the gas or transit pass anyway.
- With a loan, if you get laid off, if your hours at work are reduced, if you get injured or become sick, or if your income drops and you can’t afford to make your loan payments, then your loan would be sent to collections. Your credit score would be damaged again/more and you would have more stress in your life. However, with a cash secured credit card, if you don’t use it, then you don’t have to pay anything. If your life hits some bumps in the road, your credit will continue to improve, and there won’t be any additional problems that a loan-based credit rebuilding program could cause.
In short, from our perspective, a cash secured credit card is a much better way to give your score a boost or rebuild your credit. You just need to make sure that when you use the card, you never miss your minimum monthly payment. If you do, the credit card company won’t take the payment from your security deposit. They'll charge you late payment fees and eventually just close your card if you don't make your payments on time.
You also don’t have to use the card much. You only need to use it once every few months to keep the card active. Also never use more than 50% of your limit on the card as this will negatively impact your credit score. We also recommend that you faithfully fully pay off the card every month and try to never carry a balance. If you do have a balance, keep it low and pay it off quickly.
As your finances improve, you may also want to consider increasing your credit limit to between $1,000 and $2,500. This may require a larger cash security deposit from you, but having more credit available to you and not using it will increase your credit score even more.
Here is a government list of a bunch of secured credit cards. Just select your province and then you can compare the cards. Here is another list with a few more cards that aren't included on the government's list.
If you’re wondering where you’re going to get the money for the cash security on a card, here are a whole bunch of ideas of places where you could possibly find the money.
What You Need to Watch Out For with Debt Relief Programs & Solutions in Edmonton
Various credit repair companies and agencies, in an effort to make more money from you, also promote certain debt relief programs and services. If you are having trouble paying your bills and making debt payments each month, or if you have some bad debts you need to take care of, then some sort of debt relief option may be a good idea for you. Just be conscious of these three things when looking at debt solutions in Edmonton:
- There are advantages and disadvantages with all debt relief solutions. If there weren’t, everyone would try to sign up for one. What you need to do is weigh the pros and cons for each option and see what will be best for you to live with in the long run. Also, as someone tells you about a debt relief program, watch out if they spend way too much time talking about its positive aspects. If they don’t take almost as much time to tell you about the negatives, move on and find someone who’s more objective and not trying to sell you something.
- If the company representative attempting to sell you a program is on commission, or gets a kick back from you signing an agreement or being referred to another business, they could be focusing more on their own financial interests rather than on what’s best for you. This is often true of businesses that only have a few options to offer you.
- There is always more than one way to fix, improve, or restore your credit, and when it comes to debt relief options, there are five of them in Canada (debt management program, orderly payment of debts program, debt settlement, consumer proposal, and bankruptcy). So if you get the sense that the person or company you are dealing with isn’t exploring all your options with you or is favoring one over the others (or isn’t even mentioning the others), then you may want to look for a second opinion with someone who will more objectively discuss the pros and cons of all your options with you.
How to Fix, Improve or Restore Your Credit Score on Your Own for Free
It's not necessary to pay anyone on a regular basis just to help you restore or improve your credit score. We have all of the best credit score tips that really work right here – for free. Check them out. We’ll show you how you can repair your credit as quickly as possible along with the most effective methods that take a bit more time. In addition to this, we can also show you what's needed to get an amazingly high credit score. If all of this seems a bit much for you, if you have a complicated situation, or if you’d like some individual help and guidance, there are financial experts located close by you who have expertise in assisting people with bad debt – and they’ll usually help you for free!
Where to Get Free Individual Credit Help in Edmonton to Fix Your Bad Credit Rating
Free Advice and Guidance from Non-Profits in Your Area
One of Canada’s best kept secrets is that some of the most helpful experts for fixing bad credit and completely repairing credit ratings are non-profit Credit Counsellors in Edmonton. They offer no cost, confidential appointments (either in-person or over the phone). If you’re having money trouble or difficulty paying your bills and debts, they are the best people to give you guidance and information about how to get back on track. Whatever you talk to them about is absolutely confidential. Don’t be embarrassed if you think your circumstances are awful. They won’t judge you. They’ve probably seen much worse. Click here to find a local non-profit credit counselling agency in your area.
How to Get Free Credit Score Repair Help in Edmonton from Your Bank or Credit Union
The lender at your financial institution, or the mortgage broker if you applied for a mortgage, is a good person to talk to about your credit rating. You might have been declined for a loan. Instead of being embarrassed, use it as an opportunity to figure out how you can best get your financial situation back on track. If you get declined for something you’ve applied for, e.g. a loan, line of credit, or mortgage, the lender is allowed to tell you why. And if the explanation doesn’t make sense, get them to explain it again. Finally, ask them what you should do to get a better credit score and overall credit rating so that you’re not declined next time.
How to Get a Free Copy of Your Credit Report
If you haven’t seen a copy of your own credit report and want to find out what it really looks like, you can get a free copy of your credit report. It doesn’t, however, include your score. For that you’ll need to pay either Equifax or TransUnion, the two credit reporting agencies in Canada (they charge between $15 and $25). If you’re okay with just an estimate of your score, you can use this tool for free. The neat thing about this online tool is that you can change your answers to the questions and see how certain factors affect your score. This type of interactive information isn’t usually available, let alone for free, and certainly not from paid credit repair agencies.
Save Money & Do It Yourself - Repair, Fix or Improve Your Credit on Your Own
If you live in Edmonton and are seriously considering finding a credit repair company to assist you with improving or repairing your credit, we honestly believe that you’d be much better off doing it yourself. Start by getting a copy of your credit report – the free one should do for now (if you really want to know your score or have a baseline to measure your progress from, then go ahead and pay to get your credit score). Talk to your banker or a certified credit counsellor for some guidance. Think about applying for a cash secured card if they recommend it, and follow the suggestions we’ve outlined above along with in the guidance provided on the websites we link to on this page. Repairing your credit takes time and diligence, but by using the information we give you here, you’ll save a ton of money and your credit rating will be on its way up as quickly as possible.