What are these letters and numbers on my credit report?
We’re not going to run through every letter and number that you may find on your credit report – mainly because the Canadian government has the perfect rundown as to what to expect when you open your report. We’ll give you a few examples to help you understand it, though. For example, if you spot, ‘M4,’ it means your mortgage (M) is between 90-119 days late (4). ‘I0’ means your installment credit (I) is either too recent to rate or has been approved but not yet used (0). ‘R9’ means your revolving credit (usually a credit card) (R) has either been written as a bad debt, sent to collections, or bankruptcy (9). While our examples are not exhaustive, the Canadian government makes it simple to reference what these letter and number combinations can mean for your credit score.
How are credit scores calculated?
Based on the artifacts found in your credit report – it’s as simple as that. There are multiple areas of your report where these calculations are made – from how many credit accounts you have to the age of your credit, how much is owed, types of credit you are using, any new credit, hard inquiries, if you’ve had any late payments, etc. Clearpoint offers a stellar rundown of the impact each of these dimensions have on your credit score. If you find yourself confused or overwhelmed, know this: as long as you pay your credit accounts on time (every time) and ensure that your combined credit balance is under 30% of your combined credit limits, you’re going to have what’s considered a ‘Good’ credit score. If you’re shopping for a mortgage, this is exactly where you want to be!