When Credit Vanishes: What You Need to Know About Protecting Your Credit Score
Imagine logging into your credit report only to find your score has completely disappeared. That’s exactly what happened to several Canadians recently, according to a Yahoo News article. Equifax, one of Canada’s major credit bureaus, removed long-standing credit histories due to inactivity—leaving some consumers unable to qualify for a mortgage or even be seen by lenders at all.
At Canadian Mortgage Professionals in Calgary, we know how crucial a healthy credit score is to your homeownership journey. Whether you’re buying, refinancing, or renewing, here’s what you need to know—and how to avoid getting caught in a similar situation.
Why Credit Matters in the Mortgage World
Lenders use your credit score and history to determine:
- Your eligibility for a mortgage
- Your interest rate
- Your borrowing capacity
- Your overall risk profile
If your score disappears, you may face:
- Rejection from lenders or need for extra documentation
- Delays in financing approvals
- Limited access to the best rates—even with a strong income and savings
How to Keep Your Credit Healthy: Key Recommendations
- Maintain At Least Two Types of Credit
A strong credit profile includes varied, active accounts:
- A major credit card (Visa, Mastercard, etc.)
- A line of credit, personal loan, or auto loan
Different credit types show lenders you can handle various financial obligations responsibly.
- Keep Your Credit Active
Inactivity was the main cause behind Equifax deleting credit scores. Even if you’re debt-free, use your credit cards for small, recurring expenses (like gas or groceries), and pay them off monthly to show consistent activity.
- Manage Credit Card Balances Wisely
Lenders look at your credit utilization ratio:
- If possible don’t allow your credit card to stay above 75% of your available limit
- Aim to stay below 50% to optimize your score
- Example: If your limit is $5,000, try to keep your balance below $2,500, ideally under $1,500
- Set Up Payment Reminders or Auto-Pay
Missed or late payments are among the fastest ways to damage your credit. Use calendar reminders or automate minimum payments to maintain a strong score.
- Don’t Cancel Old Cards
Older credit cards contribute to the length of your credit history. Even if you rarely use one, keep it active with small purchases every few months.
- Monitor Your Credit Regularly
Pull your credit reports for free once a year from Equifax and TransUnion to:
- Ensure accuracy
- Check for fraud
- Catch signs of inactivity before they affect your profile
FAQ
Q: What credit score do I need to buy a home in Canada?
A: Generally, a score of 620 or higher is required. Higher scores unlock better rates and more lender options.
Q: How often should I check my credit report?
A: At least once per year from both Equifax and TransUnion.
Q: Will using my credit card and paying it off help my score?
A: Yes. Regular, responsible use shows lenders you manage credit well.
Final Thoughts
Your credit score is a living, breathing reflection of your financial habits. Whether you’re planning to buy now or years down the line, keeping your credit profile active, balanced, and diverse ensures you’re always mortgage-ready.
Need guidance? At Canadian Mortgage Professionals, we help clients understand their credit, build it strategically, and navigate the mortgage process with confidence.
Contact us for a personalized credit and mortgage review.
