• A common misconception is that no credit is good credit. Financial institutions and insurers
base your credit worthiness on your repayment history. If you have no credit history, it will be
difficult to secure a mortgage with a co-signer or guarantor.
• Alternate credit such as cell phones, hydro bills, vehicle insurance helps when there is lack
of credit. Tip: Make monthly payments on time to show consistency.
Pay Credit on Time
• It’s not difficult in our busy lives to miss a payment or two. Tip: Set up pre-authorized
payments for cell phones, credit cards, utility bills, to avoid late payments.
Do Not Exceed Credit Limits
• Make sure you do not go over your credit limits. When a credit card is over its limit, it significantly impacts credit score. Tip: Do not go past 50% of your limit on your credit card or line of credit.
Do not close out credit cards or unsecured lines of credit.
• One third of your score comes from your credit history, therefore; as soon as you close
the old credit card, you cancel the history that has hopefully improved your credit score. Your
credit score is gauged on the following:
• 35% is based on payment history
• 30% is amount owed and available credit
• 15% is for length of credit history
• 10% is for types of credit used
• 10% is for search and acquisition of new credit and inquiries
Limit Credit Bureau Reporting
• Having your credit bureau report pulled frequently while you’re shopping for a large item
has a negative impact on your beacon score. When your credit is accessed multiple times
within a short period of time, it reflects as credit instability and lowers your credit score. Tip: Limit the number of times you allow your credit bureau report to be pulled
August 29-2016 Rob Fuccenecco www.campbellrivermortgagebrokers.ca
On December of 2015, the Finance Minister announced a change to the down payment requirement for insured purchases between $500,000 and $1,000,000. Currently the minimum required down payment is 5% of the purchase price for any owner occupied property or second home. As of February 15-2016, the minimum down payment will be 5% on the first $500,000 and then 10% of the value above $500,000.
Tip: If you’re buying a house for $600,000, you’ll now need $35,000 instead of $30,000 from your own resources. For purchasers buying properties under $500,000, there are no changes to worry about, and for purchases above $500,000 the current rules apply regardless of the closing date. Therefore, if you are planning on buying a property above $500,000 ensure you are aware the new rule.
Rob Fuccenecco www.campbellrivermortgagebrokers.ca