What you dont know about debt can hurt you and your credit.
Financial literacy and education are the biggest areas of opportunity for Canadians when it comes to their debts and managing those debts effectively.
Just because you qualify for a line of credit, a loan, or credit card doesnt mean you should apply for one. Its not only your regular or irregular payments that affect your credit.
Other factors are your TDSR, which is your Total Debt Service Ratio. That is determined by the amount of balance on your card(s), how close you are to your limits, and how much available credit you have at your disposal.
In fact, you can have immaculate credit and be up to date on all your minimum payments, but still be declined for a mortgage or additional credit because of things like being at your credit limit or for even having too much credit available to you.
The lender has to consider this scenario:
IF you were approved for their credit product AND you chose to max out all of your available credit, COULD you still afford your payments to all your credit products, including their credit, as well as your day to day expenses like food, shelter, etc?
If not, youll likely be declined.
If you think you need help with your debt, get a