When Does a Bankruptcy Clear from Credit Report?
What is credit reporting and how does it affect me?
In Canada there are two major credit reporting agencies; Equifax and TransUnion. Most people commonly refer to these agencies as the ‘credit bureaus’. Credit reporting agencies do exactly that: they report credit history. They can also be referred to as an information service as they provide copies of your credit report to potential lenders. This allows the banks and other lenders to determine how much risk they are taking when they loan you money. Whenever anyone lends money they are taking a risk that it will not be repaid.
By reviewing your credit history the lender is determining how risky you are and if they prepared to take that risk. To get any significant credit, you need a good borrowing history.
Approximately once each month every major lender in Canada (the banks, credit card companies, finance companies) sends a report about their borrowers to the credit bureaus. Also, the federal Superintendent of Bankruptcy reports a list of everyone who filed a consumer proposal or bankruptcy to the credit bureaus, as well as a list of everyone who has been discharged. The credit bureaus collect this information, summarize it, and sell it to their members, the lenders.
When you apply for credit you normally sign an application that provides the lender consent to access your credit history. Generally this consent allows then access not only the first time you apply, but anytime afterwards as well, as long as your account is open. It is also this consent that allows the lender to provide the bureau information on your payments etc. once you have been approved.
How long does a bankruptcy or consumer proposal stay on my credit report?
How long bankruptcy stays on your credit report in Canada will depend on the credit bureau that is reporting.
At this point the bankruptcy will leave the credit report and you will need to start to rebuild your credit.
How long a consumer proposal stays on your credit report again depends on the credit bureau that is reporting.
What if there is an error on my credit report?
Credit bureaus maintain accurate databases of borrowing history, but the data is not perfect because it is supplied by humans, who can make mistakes. You do not want to be rejected for your next loan because the wrong address is listed on your report or there is a misspelling of your name. This is also a good time to ensure you have not been the victim of identity theft. Check to make s