Who are the credit reference agencies and how to they impact my car loan

Who are the credit reference agencies and how to they impact my car loan in Hamilton?

Posted by on Jan 07, 2021 - Archived under Bad Credit Car Loan Tips

We talk a lot about credit scores and credit reports when discussing car loans. But who exactly decides your score? Who keeps a record of your credit history?

That would be the credit reference agencies. Also known as the credit bureau, consumer credit reporting agency or credit reporting agency, these organizations are responsible for maintaining credit records for every Canadian.

Who are the credit reference agencies?

There are two credit reference agencies that operate in Canada, Equifax and TransUnion.

Equifax opened in Canada back in the 1920s and is based in Toronto. TransUnion opened in 1989 and is based in Ontario.

Both are global companies that manage credit records across the world. They are responsible for a large proportion of the credit reports seen every day for car loans, mortgages and any type of credit application.

What does a credit reference agency do?

Credit reference agencies compile information on your financial dealings and credit use to create your credit report. They work with banks, companies and anyone who deals with credit.

Every time you use your credit card, apply for a car loan or get a new cell phone contract, these agencies will make a note of it.

Your credit report will include:

  • Your name, age and address
  • Your employer, job title and how long you’ve been employed
  • Any current credit such as credit cards, mortgages or car loans. And your payment history for that credit
  • All of your settled accounts and payment history
  • Any inquiries made by lenders using a hard inquiry

These records are used to make up your credit score.

Why do they do what they do?

The idea of credit reference agencies is to provide lenders with the information they need to make lending decisions. Your credit history paints a picture of what kind of borrower you are and makes it easier for lenders to make decisions about whether to lend to you or not.

By looking at your credit history and finding out whether you always pay on time or whether you have missed payments, a lender knows what level of risk you pose.

They can also check to see how much credit you’re already using to make sure you can afford to replay what you plan to borrow.

What rights do I have over my credit report?

You don’t have many rights over your credit report. It is compiled whether you agree to it or not. You do have the right to dispute inaccuracies and incomplete information but that’s about it.

You will have to prove your case, but if you can demonstrate your credit report or history is wrong, the organization who made the mistake can ask the agency to remedy it.

For those of you who know that you have a challenging credit situation, please visit Dixie Auto Loans where we have a team of credit specialists ready to help you get approved for a car loan today!

Let’s get in touch! 


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