Review All of Your Options to Get the Best Credit Repair Help in Sarnia
A number of companies who provide credit repair in Sarnia are trying to sell really expensive services that unfortunately often saddle people with more debt. They don’t provide as much value as a lot of people would expect for the price they are paying. And they possibly put someone in jeopardy of having worse credit by sending their new credit repair loan to collections if they are not able to make all their payments. While this may be unsettling, here is some good news: you can improve and repair your credit score for free in Sarnia – and even receive better advice and more one-on-one help than most of credit fixing companies offer. Keep on reading and we’ll show you how.
How to Fix & Repair Bad Credit for Less Than Credit Repair Companies, Services, & Agencies
The goal of credit repair services is to help each of their customers improve his or her credit score. The primary way many of them do this in Canada is by providing credit building loans. The idea is that this loan will create some new good information on someone’s credit report, which shows the credit scoring system that this person is able to borrow 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 financial situation gets better, you may want to think about increasing your credit limit to somewhere between $1,000 and $2,500. This may mean that you’ll need to increase your cash security deposit but having a larger credit limit like this and not using it will boost your credit score even more.
Here's a government list of most secured credit cards in Canada. Just select your province, press the "Apply" button, and then you can compare the cards. Here's another list with some cards that the government missed on their list.
If you’re scratching your head wondering where you’re going to find the money for a cash secured card or eventually increase your cash security to over $1,000, here are whole lot of ideas to help you find the money you need.
What You Need to Watch Out For
Some credit repair agencies will try to promote specific debt relief services and programs to you. Credit repair companies want to earn money, and while there’s technically nothing wrong with a company wanting to earn as much as possible, how they go about doing this is important. If you have bad debts you’re having difficulty paying, a debt relief option might be a good solution for you. So to help you figure out what debt solution in Sarnia might be best for you, here are three things to be aware of:
- All debt relief options have just as many disadvantages as they have advantages. If there wasn't some sort of down side, then everyone would be enrolling in one of these. If you're looking for a debt relief option, the key is to find one with the right advantages for your situation and disadvantages that you can live with. Watch out for anyone promoting a debt relief program who focuses too much on the positive aspects of their program and doesn’t fully inform you of the negative consequences of their program.
- If the employee trying to sell you a program earns commissions or receives a financial benefit from you signing up for it, then they may be putting their own financial interests ahead of yours. The fewer options a company offers, the more often this will be true.
- In Canada, there is always more than one way to improve, restore, or fix your credit, and when you look at debt relief options, there are as many as 5 of them depending on your province: the debt management program, orderly payment of debts program, a debt settlement, a consumer proposal, and going bankrupt. So if you're left with the impression that the person or company you are working with isn’t fully exploring all of your options with you or is promoting a particular one over the others (or isn’t even saying much about the others), then you'll probably want to get a second opinion from a professional who will be more objective in discussing the advantages and disadvantages of all your options with you.
Top Credit Score Tips to Improve, Restore, or Fix Your Credit – How to Do It Yourself 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 Sarnia 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 Sarnia. 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 Obtain Free Credit Score & Repair Help in Sarnia from Your Credit Union, Bank, or Mortgage Broker
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.
Get a Copy of Your Credit Report for Free
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 Your Money, Fix or Do Your Credit Repair Yourself – That’s What it Comes Down To
If you live in Sarnia 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.