It is beneficial to understand how credit works, and demonstrate trustworthiness through good credit.
Credit ratings are determined through the evaluation of a credit rating agency, and reflect how well a debtor can be relied upon to pay back debt, based on credit history. In general, credit ratings or scores are not transferred between countries, which means Canadian credit must be built for a credit rating to be acknowledged in Canada.
If you do not have a Canadian credit rating and your current bank operates in Canada, you may be able to transfer your credit history by opening a Canadian bank account. Alternatively, you can approach a bank or financial institution in Canada to begin rebuilding your credit. For example, if you begin using a Canadian credit card and consistently make full payments, you can earn a good credit rating.
For more information about understanding credit, consult the Canadian Bankers Association website.
Having a Credit Card
A credit card is a plastic card connected to a credit company, that can be used as a form of payment. At the time of payment, funds are borrowed from the credit company free of charge, as long as the balance of the debt is paid by its payment due date.
The downside to a credit card is that if debts are not paid by their due date, a relatively high interest rate is applied to the entire outstanding balance. However, if you make sure to pay off your debt, credit cards provide a convenient method of payment and an excellent way to build good credit.
Visit Settlement.org to learn about getting a credit card, even if you do not have Canadian credit history.
Popular credit cards include: