Establishing and Maintaining Your Credit

So, what is a credit score?

Your credit score is an assessment of your ability to fulfill the financial commitment of borrowing credit at a particular time, based on your financial history as reported to the credit bureau. It is important to remember that your credit score is dynamic. This means that it will change as your financial circumstances change.

While most financial institutions offer similar products and collect similar information during the approval process, credit granting policies will vary by product and from one credit grantor to the next.

Regardless of an institution’s credit granting policies, your overall credit rating will be one of the most important factors in determining if your approved from credit at any given time.

How is my credit score determined?

Your credit score is determined by your credit history. Every time you apply for or receive credit, and every time you make or don’t make a payment on time, you are building your credit history.

1. Review your past dealings with them;
2. Consider any new information you provide in your credit application;
3. Contact a third party credit agency for a report on your overall credit history.

Credit agencies collect credit information from the companies that provide the credit to you. This builds your credit report, which represents a summary of your activities with a variety of financial institutions and consumer companies.

It is good practice to request the details of your credit report from the credit agencies periodically, to help you understand your rating and ensure that the information is correct. This is important because a strong credit record enhances your ability to get credit in the future, whereas negative reports such as overdue payments or non-payments, could make it more difficult for you to borrow or get credit in the future.

You and your credit history