Credit Builder Loan FAQ

Our Credit Builder Loans work differently than a traditional loan. Instead of receiving the loan amount upfront, we put the loan amount into a secured account with a financial institution. So you don’t get the loan amount in your hands upfront. However, when you start to make affordable, scheduled payments towards this secured amount, then we consider that you are repaying a loan to us, which allows us to report every payment you make to TransUnion and Equifax, raising your credit score. The payments you make also build equity against this secured loan amount (Equity is money that you can withdraw later).

We report to TransUnion and Equifax every month. However, as a new client, it can take up to 90 days until you see a new product on your tradeline.

If you are going through bankruptcy or consumer proposal in Canada, our programs are designed for you. We created our credit building programs so they could benefit everyone, and those that aren’t able to apply for traditional loan products are still able to get onboard and start rebuilding their credit.

Refresh Financial provides credit building programs across Canada, excluding Saskatchewan (but we’re working on that).

There are no upfront fees due at the time you sign up.

We set up scheduled payments on your account. You will receive a notification every 7 days prior to your payment being taken out.

If you need to adjust your billing information or payment schedule, you must inform  us at least 5 business days prior to the change taking effect by calling 1-800-746-8480.  You can also do this through your Refresh dashboard.

It will take up to 15 business days to process a loan equity request. Once processed, the funds will be deposited directly into your bank account. You can withdraw any equity you have built at any time, without canceling the program.

If you would like to cancel your program with Refresh and are still within your grace-period, we can honour a cancellation with at least five business days’ notice before your first scheduled payment. If you would like to cancel your program with Refresh once the grace period has passed, you are responsible for covering your administration/commitment fee and any interest or fees accrued from missed payments. If you have accrued equity, this amount will be returned to you.

For our program work properly, it’s important that your account in good standing; note that any late or missed payments can negatively affect your credit score. Maintaining an arrears balance on your account is reported as a negative on your credit report, which is the opposite of what we want to accomplish!  Remember, if you need to change a payment date or adjust your banking details, please give us at least 5 business days’ notice. Also, note that if missed payments are made up within 30 days of original payment date, this won’t negatively affect your credit score. Here’s where you can make your payments.

Yes, you can repay your outstanding balance at any time. Once you’ve paid off everything owing, we send you your available funds and mark your credit building program as paid off in full to both TransUnion and Equifax. However, it’s important that you are aware that the fewer payments you make means less improvement to your credit score. Each payment made on time and in full improves your credit score, so paying out early means you won’t get the best benefit (and won’t get the highest credit score!)

First, congratulations on being approved for a car loan. The short answer is that you most likely still need to build your credit score. Car loans have collateral in the form of your car, so if you don't make your payments, the lender will repossess the car. If you don’t make your payments, it’s simple — the lender will repossess the car. Because this loan is fairly risk-free for the lender, they’ll only give you small kudos for making your payments, and your credit score will not suddenly sky-rocket. If you’re serious about getting your credit in shape, our credit building programs are your best bet.

Get answers here: RefreshFinancial.ca/credit-card-faq