How to Get the Best Credit Repair in Thunder Bay – a Review of Your Options

Some credit repair companies in Thunder Bay are trying to sell expensive services that often saddle people with more debt and don't provide many with the value they'd expect to receive. On top of this, when some people aren't able to make the payments on their new credit repair loan, the credit repair company can send the loan to collections which puts these people in jeopardy of having worse credit than when they signed up for the program. While this may be unsettling, there is some good news. In Thunder Bay you can repair and improve your credit for free – and often get better advice and more one-on-one help than a lot of credit fixing companies provide. Keep reading and we’ll show you how to do this.

Credit Repair Services, Companies & Agencies – Pay Less Interest & Fees to Fix or Improve Bad Credit

Credit repair services aim to assist people in improving their credit score. In Canada, the main way they do this is by granting credit building loans for a fee. The logic behind this is that a new loan will put positive information on someone’s credit report, demonstrating to the credit scoring system that this person can use credit wisely.

This method likely helps a good number of Canadians boost their credit score, however in our minds, it’s a much too expensive option for a lot of people. The credit building loan allows the credit repair companies to charge interest and fees for their service every month over several years. But we believe there is a better solution that is cheaper and more effective.

Why to Use a Cash Secured Credit Card to Fix, Improve or Restore Your Credit Score

In Thunder Bay, a cash secured credit card can be a much better and faster way to fix, improve, or restore your credit score compared to a credit rebuilding loan. A cash secured card requires you to put up some money as security for the credit card. The cash security required can be as little as $200 or $300. This credit card then functions as a completely normal credit card.

Here are the advantages of a cash secured credit card compared to a credit rebuilding loan:

1. The cash secured credit card can provide a much quicker and greater boost to your credit than a loan.
2. It is far cheaper than most credit repair loans because it only has one annual fee, and you don’t have to pay any interest costs or fees if you pay off your balance in full every month.
3. 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.
4. 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, a cash secured credit card is a far better way to rebuild your credit or give your score a boost. Just make sure that when you use it, you always make at least your minimum monthly payments. If you miss a payment, the credit card company won’t take the monthly payment from your cash secured balance. You will still need to make it and not making the payment will hurt your credit. If you miss a number of payments, the credit card company will close your card and give you your cash security back after deducting any money you owe them.

Another great advantage of a cash secured credit card is that you don’t have to use it much. All you need to do is use it once every few months or so to keep the card active and never use more than 50% of your credit limit (doing this will negatively impact your credit). We would also recommend that you always pay off the card balance in full every month and never carry a balance.

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 Thunder Bay

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 Thunder Bay:

1. Every debt relief option (there are 5 of them in Canada) has as many disadvantages as it has advantages. If they didn’t, then everyone would be signing up for one of these programs. The key is to find the debt relief option with the right advantages for you and disadvantages that you can live with. Beware of anyone who pitches a debt relief program to you and focuses too much on the positives and doesn’t spend much time making you aware of the negative aspects of the program.
2. If the person trying to sell you a program earns commission off of you signing up for the program, then they may have their financial best interests at heart and not yours. The fewer options their company offers, the more often this will be true.
3. In Canada, there are 5 basic ways to fix, improve, or restore your credit: a debt management program, an orderly payment of debts program, a debt settlement, a consumer proposal, and filing for bankruptcy. Anyone you talk to about getting help with your debts should be explaining all of these options, and what the pros and cons of each would be for you. If you get the feeling that whoever you’re talking to is pushing one particular option on you, it would likely be best to get a second opinion from someone more objective.

How to Fix, Improve or Restore Your Credit Score on Your Own for Free

Paying someone to help you rebuild or improve your credit score is not necessary. We have all of the top credit score tips that actually work right here – completely for free. Take a look. We’ll show you how you can fix your credit fast along with the most effective ways that take more time. Once you’re done with all this, we can then show you how to achieve a super high credit score. If this all seems a bit complicated, your circumstances are unique, or you’d like some personal advice and guidance, there are financial experts in your area who have experience helping people with bad debt – and their help is usually free!

Where to Get Free Personal Credit Assistance in Thunder Bay to Fix Your Bad Credit Rating

Free Guidance & Information from Non-Profit Agencies Near You

A lot of people don’t know this, but some of Canada’s most helpful experts on fixing bad credit situations and completely repairing credit ratings are non-profit Credit Counsellors who offer free appointments (either over the phone or in person) in communities across Canada - including Thunder Bay. If you have debts you are struggling to pay or are struggling in some way with your finances, they are the best people to sit down with and go over your financial situation. Anything you discuss with them is completely confidential, and don’t worry if your situation is really bad. They’ve likely seen far worse. They're not going to make you feel bad or judge you. They are simply there to help people. Click here to find a local non-profit credit counselling service near you.

How to Get Free Credit Score Repair Help in Thunder Bay from Your Bank or Credit Union

The lender at your bank or credit union is a good person to ask about your credit rating. You might have applied for a loan and been turned down. Don’t be embarrassed, but use it as an opportunity to learn what you can do to get your finances back on track. When a lender declines you for a loan, line of credit, overdraft, or something else you applied for, they can tell you why. Ask them to explain anything you don’t understand. Then ask them what you can do, very specifically, to improve your credit score and credit rating. If you’ve applied for a mortgage, ask your mortgage broker these same questions.

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.

To Sum It Up - Save Your Money, Repair & Improve Your Credit Yourself

So if you live in Canada and are seriously thinking about finding a credit repair company to help you repair or improve your credit, we think you’d be far better off doing it yourself. Get a free copy of your credit report (and your score if that’s important to you right now). Speak with your banker or a credit counsellor for guidance. Consider getting a cash secured credit card if your banker or credit counsellor recommends it. And follow the suggestions we’ve laid out here as well as the guidance provided in the resources we link to from this page. Credit repair ultimately takes time and patience, but by taking advantage of the resources we point out here, your credit should be re-established and improved as quickly as is possible and you’ll save a lot of money in the process.