https://padlet.com/kirstenkellner/fm9lt4ai861vq61h By: Kirsten Kellner en-us 2021-11-18 20:52:20 UTC 2021-11-29 22:43:44 UTC hello@padlet.com kirstenkellner https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900553520 Credit is comprised of your credit history (your borrowing history), your credit report (a summary of your credit history), and your credit score (a number that represents your risk). There are five main factors that influence your credit score: payment history, credit utilization, number of credit inquiries, length of credit history, and credit type. Credit ratings are a system created and used by credit reporting agencies that show how and when you make payments. Letters are used in your credit rating to categorize the type of credit. Each letter will be accompanied by a number, ranging from 0 to 9 based on when payments for each credit have been made. "0" represents that the credit is too new to be rated. "1" represents that all payments have been made within 30 days of billing. The score gets progressively higher as payments are later. 

This website is included to explain what credit ratings are and how they are used to categorize your credit history. This resource is especially useful as it clearly breaks down what each letter and number represent in a credit rating.]]> 2021-11-18 20:56:33 UTC https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900553520 kirstenkellner https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900553899 This website provides an example of a credit report from TransUnion Canada. At the top of the report, you will see personal information listed that includes name, date of birth, telephone number, employer, and address. Next, if you provided the credit reporting agency a statement it will be shown here as the consumer statement. Following the consumer statement (if included), is a summary of the credit report. A legend explains how TransUnion uses symbols to describe payment history in each account during the past two years. Each account is then listed with a description of the type, when it was opened, condition, pay status, balance, payment, and responsibility. 

I choose to include this website as TransUnion is one of the most commonly used providers of credit reports. Credit reports have a huge influence on your credit rating as they provide a summary of your credit history, which is the most influential factor when analyzing a credit score. I found it useful to see an example of a credit report from TransUnion, and would be a good website to reference to compare (and assess for errors) if you receive your own credit report from TransUnion. ]]> 2021-11-18 20:56:48 UTC https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900553899 kirstenkellner https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900554291 https://www.thebalance.com/what-is-a-beacon-credit-score-5193695
Credit scores can vary based on how they are analyzed and which factors are taken into consideration. The Beacon credit score is an algorithm commonly used in Canada by lenders to determine the risk of borrowers. Beacon 5.0 and Beacon 9 scores are based on the FICO credit score. The FICO credit rating is calculated based on payment history, amounts owed, length of credit history, new credit, and types of credit used.

This website was included as it gives a more depth description of the Beacon credit score, which is commonly used by lenders in Canada. This website reveals that there are different algorithms used by lenders to calculate a credit score and different variations of a FICO score (including Beacon scores). ]]> 2021-11-18 20:57:06 UTC https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900554291 kirstenkellner https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900554450 Your credit report is a summary of your credit history. Your credit score is a number calculated using a formula based on information on your credit report. Lenders don't actually share the exact formula that they use to calculate credit scores. There are several factors that we know influence credit score: length of credit, existing credit, missed payments, if you are close to or above your credit limit, debts, if your debts have been sent to a collection agency, and insolvency or bankruptcy. Credit bureaus have to follow rules as to who is allowed to view your credit report and how it can be used. Included in your credit report are your personal information, financial information, and other accounts (such as mobile phone/internet provider, and mortgage information). 

This website is included as it provides an introduction to credit reports and credit scores. It also includes a more detailed list of factors that influence your credit score compared to other websites. I found it interesting to learn that lenders do not share the exact formula used to calculate credit scores, and so it would be impossible to know what exactly is included in the analysis of your credit rating. ]]> 2021-11-18 20:57:13 UTC https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900554450 kirstenkellner https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900554590 Your credit report is a summary of your entire credit history (active loans, payment history, and credit limit) and is highly influential in your credit score. In Canada, credit scores are commonly managed/calculated by Equifax and Transunion. Your credit score ranges from 300 to 900, with a higher score being better. The higher your credit score the easier it will be to loan money. Paying bills late will significantly decrease your credit score. Errors on your credit report or identity theft will also influence your credit score. Being a newcomer to Canada will influence your credit score as you will not have any credit history in Canada. 

I included this video as it provides a unique perspective of newcomers to Canada and how this would affect your credit score. The creator of the video was a Newcomer to Canada and had to start building credit from nothing. He provides his own experiences with credit and ways Newcomers to Canada can start to create a positive credit history/score.  ]]> 2021-11-18 20:57:19 UTC https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900554590 kirstenkellner https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900555079 This video has three people of different financial backgrounds get their credit scores from Equifax, TransUnion, Credit Karma, and Borrowell. Each person found that their credit scores varied significantly and were dependent on which website was used. Next, the participants bring their credit scores to lenders to see if the credit score that the consumer provided would influence their borrowing ability. The lenders did not accept the credit scores that were brought by the partcipants as they are required to conduct their own credit report that includes a Beacon score. The companies of Equifax, TransUnion, Credit Karma, and Borrowell are to be used for educational purposes only and based on the results of the video do not seem to be used by borrowers to assess risk. 

I choose to include this video because it demonstrates how different companies use different algorithms for calculating a credit score. As a result, one person can have a large difference in credit scores dependent on which company provided it. I found it especially interesting to learn that companies such as Equifax, TransUnion, Credit Karma, and Borrowell all have disclaimers that they are to be used for educational purposes only. ]]> 2021-11-18 20:57:39 UTC https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900555079 kirstenkellner https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900555330 A brief summary of the factors that will influence the credit rating of an individual (payment history, amount owed, length of credit history, types of credit, new credit). Your credit score can change every month. It is recommended that you check your credit report annually because if your credit report is accurate, you will have an accurate credit score. You don't need to check your credit score all the time, the best time to check your credit score would be before making a large purchase. 

I included this video as it provided a summary of what credit scores are, how they are calculated, and when to check your credit score/report. The information that was most useful from this video to me was that new credit applications can be referred to as a "hard hit" and can impact your credit score, versus checking your own credit score is a "soft hit" and won't negatively affect your credit score. However, they don't recommend that you need to check your credit score frequently, instead check your credit report annually for errors. ]]> 2021-11-18 20:57:51 UTC https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900555330 kirstenkellner https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900555501 This image provides a quick reference as to what the different major factors are in creating a credit score and how they are weighted. The payment history looks at if you are late in payments, and if there are late payments how late they are. The amount owed looks at how much debt is owed and how much credit you still have available to use. The length of credit looks at how long you have had a credit for. The types of credit are the variety of credit that you have. New credit is how often you apply for credit.]]> 2021-11-18 20:57:59 UTC https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900555501 kirstenkellner https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900555643 This picture outlines the differences between a credit rating and a credit score. There are a lot of similarities between the two terms and often the term credit rating is used to describe a credit score. I choose to include this image as it defines and differentiates credit rating and credit score. This image can be used as a reference to better understand the terminology. ]]> 2021-11-18 20:58:06 UTC https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900555643 kirstenkellner https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900557828 I was the most surprised to learn that there is not only one way to calculate a credit score and your credit score can vary significantly depending on who provides it. Additionally, I was surprised to learn that the exact algorithm used by companies and lenders is not shared/available for the general public to view. ]]> 2021-11-18 20:59:37 UTC https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900557828 kirstenkellner https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900558966 This topic is relevant to me as I recently looked at my credit score and had found that it was lower than I had expected. I consistently pay at least the minimum payment on time and so had expected my credit score to be higher than it actually was (as calculated through my online banking website). This low credit score had prompted me to investigate my credit in more detail. When looking back at my credit history, a few years ago I had a credit card with a store that I had missed payments on. I then ensured that the credit card was now fully payed off as to not further damage my credit rating. ]]> 2021-11-18 21:00:25 UTC https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900558966 kirstenkellner https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900560211 The most important information that I learned if you (as a consumer) were to get your credit score from companies such as Equifax, TransUnion, Credit Karma, or Borrowell, this score is for educational purposes only and likely not used by lenders. It might be helpful to look at your credit score before making big purchases to ensure that there are no errors on your account. However, it is more important to request and view your credit report annually to ensure that there are no error. ]]> 2021-11-18 21:01:21 UTC https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900560211 kirstenkellner https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900562606 Through viewing the websites, videos, and images on this board you can expect to learn more about credit ratings and credit scores. Credit ratings are used by credit agencies to represent your payment history (the types of credit you have and if you make payments on time). A credit score is a numeric value based on credit history that lenders use to assess your risk as a borrower. This board will further discuss the differences between credit ratings and credit scores are, and what goes into the analysis that results in a credit rating.

]]> 2021-11-18 21:02:52 UTC https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1900562606 kirstenkellner https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1916669978 Millennials are checking their credit scores more often than ever. However, according to the results of a survey by Equifax there are many credit myths that are still misunderstood. In the video, the misconceptions are explained: 
1. Your income will not affect your credit score - TRUE
2. You have more than one credit score - TRUE
3. Checking your own credit score decreases your credit score - FALSE
4. If you avoid using credit you will have a higher credit score - FALSE
5. Credit reports don't include your RRSP - TRUE
6. Married people have a joint credit report - FALSE
7. Missed credit card payments will stay on your credit for 7 years - TRUE 

I included this video because it highlights that people are checking their credit scores more often. Despite this, there are still many myths about credit believed by the general public. This video was helpful in clarifying common misconceptions about credit. I found it particularly interesting to learn that your income is not part of the analysis of a credit score, however, it will influence your credit score as having a higher income may allow you to make payments on time consistently. ]]> 2021-11-28 22:27:17 UTC https://padlet.com/kirstenkellner/fm9lt4ai861vq61h/wish/1916669978