How much do you know about your credit report and your credit score? Take this quick quiz to find out:
1. Ordering a copy of your credit report is:
a) only necessary when you are about to apply for a loan or credit card
b) the only way to know if your report is accurate
c) mandatory for all Canadians over 18 years of age.
Answer: B. Ordering and reviewing a copy of your credit report is important to determine if fraud has occurred, if your credit history is correct and if your report is error free.
2. A high credit score means:
a) your loan applications will always be approved
b) you use credit responsibly
c) you have never missed a bill payment.
Answer: B. By showing you use credit wisely, a high credit score can help you get loans and reduce the interest rate you pay. Lenders will also review your income, job and any assets you own.
3. You can improve your credit score by:
a) paying your bills on time
b) applying for multiple loans within a short period of time
c) taking the credit report test annually.
Answer: A. As well, consumers should aim to use less than 35% of their available credit.
4. Which of the following stays on your credit report forever:
a) poor payment history involving car loans and lines of credit
c) debts sent to a collection agency
d) none of the above.
Answer: D. By law, negative information must be removed from your credit report after a certain length of time. This length is determined by the type of information in question.
5. How often should you check your credit report?
a) at least once a year
b) at least once every five years
c) at least once every seven years.
Answer: A. As a best practice, you should obtain a copy of your credit report from Canada’s two credit-reporting agencies, TransUnion and Equifax, at least once a year. Be informed. Know what is on your report in order to protect yourself from fraud. The two agencies do not share information, so you should get reports from both.
More information on credit reports is available on the FCAC website at itpaystoknow.gc.ca.