how does saving money help?
March 27th, 2008 by Questions
I keep reading about rebuilding your credit after bankruptcy and how saving money helps. While I realize that saving money is a good thing (obviously!), I`m confused as to how this actually helps rebuild your credit when things such as savings/RRSPs/etc do not show on your credit report?
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March 28, 2008 at 6:32 am, Barton Goth GCO Bankruptcy Trustees said:
While your right that saving money/RRSP’s etc. do not directly impact your credit report, but i is when you are applying for credit it makes a difference.
Essentially it allows you to demonstrate discipline and financial capacity (i.e. if you were able to set money aside there must be the capability to afford an additional payment).
As well, if the bank is concerned about lending you money you can use the savings to provide additional insentive (i.e. security, put the savings in a GIC, lock it in for a year and pledge it as security agains the loan in quesiton), it is amazing how security on a loan can help to soften the banks demands.