This one thing will have the biggest impact on your credit score! | Refresh Financial

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This one thing will have the biggest impact on your credit score!

increase credit score

When it comes to building your credit, there is one thing that will have the biggest impact on how quickly you can increase your score.

Paying bills on time. 

It may sound simple, but it's surprising how many people do not pay their bills on time, and don't realize how much this is affecting their credit score. Paying bills on time accounts for 35% of your credit score! So, if you're asking yourself, how can I build my credit score quickly, paying bills on time is crucial.

How and why does paying bills on time impact my credit score?

Your credit score is a three-digit number between 300 and 900 that lenders use to help them decide how likely it is they'll be repaid on time if they lend you money, whether that's in the form of a loan, or a credit card. The higher your score, the more likely it is that you are going to pay the money back, and therefore the easier it is not only to qualify for loans and credit cards, but to do so at the lowest interest rates.

If you don't pay what you owe back on time, your credit score will drop, letting lenders know that you're more of a risk. Lenders don't want to give money to people who are not going to pay it back. So, as your score drops with every missed or late payment, your chances of future credit approval will also drop, and the interest rates you will be offered will rise.

How can I work on increasing my score?

If your credit history is not where you want it to be because you've missed or made late payments in the past, you're not alone. In fact, more than 1 in 10 Canadian households are late or skipping debt payments (Source).

To build your credit score will take time, and commitment. You also need to have the right tools to be able to do so. The sooner you address the issues that are dragging your score down, the faster your credit score will go up. You can increase your score by taking several steps:

  1. Establishing a track record of paying bills on time. Refresh Financial's flagship product is a Credit Builder Loan that allows you to make regular payments towards a loan that is reported to both credit bureaus. As mentioned above, paying your bills on time makes up 35% of your credit score!
  2. Add to the Credit Builder Loan a Secured Card from Refresh and then make payments on time! The common theme here is that you need to have credit in order to pay it back which helps to build more credit. By mixing up your types of credit (a loan is installment credit whereas a secured card is revolving credit) you will also impact your score as having different types of credit makes up 10% of your score.
  3. Start making regular payments towards existing debt. It's just as important to get that existing debt paid down. The amount of your available credit that you use accounts for 30% of your credit score!
  4. Don’t forget your other bills! While paying bills on time such as electric, cable and gas bills do not positively impact your score, defaulted bills and those that have been sent to collections will negatively impact your score and can remain on your credit report for several years.

At the end of the day, if you only take away one thing from this article it is that you MUST pay bills on time if you want to increase your credit score. That includes your cell phone, cable, electricity and gas, mortgage, car loan, personal loans and credit cards. Pay the amount you owe on time!

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    What Canadians are saying about Refresh

    I would like to thank Refresh Financial for helping me get out of a bad spot. I never thought it was possible and almost gave up on things and then I saw Refresh Financial and and gave it a try. At first I was unsure of things but to see my credit score now makes me a believer in this program.

    – Aaron A

    “It hasn’t even been a year yet, possibly only 6-7 months, and my TransUnion score has gone up over 100 points. That was only the tip of the iceberg as recently I was able to get a consolidation loan from my bank that allowed me to move forward and make things easier for me. Talk about second chances!”

    – Angelica M

    “I am now in a position where I am able to obtain credit (just bought a brand-new car and refinanced my mortgage for a fantastic rate) and it took little to no time at all. I would 100% recommend Refresh to anyone looking to rebuild credit with as little hassle as possible.”

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    Refresh helped me regain credit following a nasty divorce, which left me with a very poor rating. They were able to remarkably help me go from a 480 to a 600 score, in just over a year. Thank you Refresh!”

    – Deb K

    I have watched my credit score jump since being with Refresh and I have already recommended it to friends and family. Thank you for helping me build my credit faster for my future and my children’s future :)”

    – Heather T

    At first I was skeptical because I wasn’t getting funds upfront and had to make payments when I really needed the money. I’ve been in the program a year now and have noticed my credit has improved drastically!”

    – Irene L

    I have been a client of Refresh Financial for approximately 3 years. Since being a client they have improved my credit immensely. Definitely recommend this company to anybody that needs help re-establishing credit.”

    – Jason I

    “I recommend this program to anyone having credit issues. At the end of the agreement, your money is refunded to you. There were times I found myself short on cash and Refresh, with permission, used a portion of my money to clear up my arrears.”

    – Margaret L

    “I would like to thank Refresh Financial for their professionalism, great customer service and for helping get back to a better financial situation. I have always been treated with the utmost respect.”

    – Martine B

    Refresh Financial is an amazing program to help people get back on their feet. I was rock bottom with nowhere to turn. My credit was beyond poor. I would recommend them to anyone. If I can do it surely anyone else can.”

    – Matthew S

    “Great company to deal with for rebuilding credit, very simple process to get started. Good service if you ever have questions.”

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    This business truly cares about its clients. The customer service is always quick to return calls or emails. Their online portal functions very well so as a customer you are always updated as you progress with your loan.

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    “Refresh Financial has made us more aware of how to take care of our financial situation and be more responsible, and making payments on time is rewarding in the end for credit. Thank You sincerely.”

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    “Refresh financial is great!!! They boosted my credit score, helped me save money and helped my husband and I buy our house;) I was not only a number to them, they stayed in touch and helped me out along the way. Answered all my questions and concerns.”

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    This company has been nothing but fantastic. They have gone above and beyond to help me. This program has given me the relief and peace of mind I need. I would certainly go back to them and give them names of people who could use this.”

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    The financial services products are excellent for new immigrants, low-income earners and small business owners. Loans, savings and credit building all in one solution is a perfect fit to help with financial goals and stability.”

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    “After successfully going through a credit rebuilding loan, I was able to use my built-up equity to purchase a newer vehicle and I have since been approved through a financial institution for a loan.”

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    “I made some poor credit choices when I turned 18 and have always had this lingering thought of how am I ever going to better my score. Since being with Refresh I have realized that I took the right step towards bettering my future.”

    – Taylor B

    “Thank you Refresh, and my relationship manager for giving me the tools for a better score with a secured card and two credit builder loans. I feel absolutely confident I’m on a better path to financial success. I am happy to be a long term client.”

    – Trevor P

    I’m so excited I’ve joined refresh! I’ve already seen a huge increase on my credit after the first month! The staff are a delight and make this so easy to understand. I strongly recommend Refresh Financial even if you have good credit this will give you a boost and you’re saving money with the reverse loan!”

    – Wayne B