Reasons for poor credit history.
Several years ago I was unable to work .I was diagnosed with cancer and had many treatments over a period of 2 years.I was very sick during this time and I did not have any insurance.I had debt and it was a reasonable level before I became ill.With no income to pay these debts .I was put into collection agencies . The last six months I couldn’t pay anything. My savings were gone. I had bills that were behind as much as 6 months, many negative hits on my credit report.To the point where I thought I would never be able to have credit again.My cancer was in remission and I was able to work again.I made arrangements to pay through a conselling service in NB . I am paid off and things are good now. My credit report is very bad.I have been wanting to buy a new car .I have been turned down because of my bad credit history.I make a good salary and would have no problem paying for one.I feel wronged in some way. My poor credit is not because I was inept managing my affairs. I am not an over spender and I am very responsible person. The loan companies only see the negative things on my report .Not the reason as to why it is bad.The cancer was the cause of my finacial difficulties .I had savings set aside for emergencies that lasted about 18 months. I have tried to get a vehicle from 5 different lenders and they flatly say no.It doesn’t make a differance how much I make for a down payment.I don’t blame them really …they see risk in lending me money. How can I deal with this problem ? Would it make a differance if i added something to my credit report explaining the cause of my problems? I don’t want to go to a dealer and use their financing for people with bad credit. They over price the vehicle and you don’t have much say in what you buy. The interest rates are shocking.What might work for me. this site is a great service for people having problems
First of all you should put a note on your credit file outlining some of the circumstances you faced. While this may not have an impact on your actual credit rating at least it will provide a bit of background to those who reference the report. The next thing do is spend some time trying to rebuild your credit by working through the following process:
1. Talk to your banker and say you want to reestablish your credit rating.
2. Be a regular and persistent saver.
3. Borrow using your savings as security. Secured loans are debts you incur that are backed up by some sort of asset or guarantee and are the easiest type of loans to obtain (consider obtaining a secured credit card from an organization such as hometrust or capital one).
4. Borrow for an RRSP. For some reason, banks have made it easier to obtain loans for RRSP’s than most other forms of credit.
5. Replicate steps 3 & 4.
6. Borrow when you don’t need to. Obtain a small line of credit. Use it to pay bills and then immediately pay off the line. Repeat this process and over time, it will have a marked improvement in your credit report.
The key to all of this is that you must pay your bills on time. Don’t bounce any cheques, don’t miss any due dates, and don’t overdraw any of your accounts (even if you have overdraft protection). As well, always remember doing the above on a small scale reduces the risk and can increase the number of contracts you can enter into and hence the number of positive comments on your credit history.