Credit reports contain information about a persons financial
history and performance with credit grantors. A file is created when a person first borrows money or applies for credit. Companies that lend money or issue credit cards such as banks, finance companies, credit unions and retailers send
information about their customers to credit reporting agencies.
Not all credit reports are the same. A basic credit file contains four types of information.
Personal information such
aliases, verification of social insurance number, date of birth,
address and employment information.
is information relating to any
credit your prospective tenant might have such as; lines of credit, mortgages,
loans with banks, retailers, credit card issuers and other lenders. This
may include types of accounts, monthly payment amounts, manner of payments balances owing, amounts past due and NSF cheques.
Credit details are
supplied by creditors with which your tenant has an account.
Every piece of credit history information in
a credit file is assigned a
by the credit grantor. These evaluations are based on industry standards, the most common of which use a range from R 0 to R 9. R ratings is the standard credit rating system known as the "North American Standard Account Ratings"
lists people who
have inquired about your credit, such as lenders, credit reporting agencies,
rental companies or any other authorized organization.
show credit grantors when a person has applied for new credit which could result in additional debt.
Lenders view multiple recent inquiries on a credit report as a sign that the
person may be overextending themselves.
Public record information is any information on public record such as a
collection (a debt that was not paid), bankruptcy, credit-related court judgment
or secured loans which are backed by an asset.
Some credit files also contain Credit Scores:
A majority of lenders use
as one method to estimate an applicant's credit risk.
Banks and other lending
institutions frequently rely on credit scores to predict how much of a risk a
person is based on credit their history.
Credit scores sometimes called
Equifax, FICO or Beacon scores are an important factor in making a decision whether or not to offer credit. In general, higher scores are considered less of a credit risk.
People with high credit scores are considered more likely to repay loans and
credit cards more consistently than people with low scores. Equifax uses a scale from
300 to 900.
Landlords also use credit scores is a risk predictor to help reduce the time and cost associated with tenant approvals
and to predict the likelihood of delinquency.
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Read more about
why Landlords need to check credit.
Check your Tenants Credit