Borrowell’s goal has always been to help Canadians make great decisions about credit. They introduced free credit scores in 2016 and followed that up in 2018 by giving their members access to their full Equifax credit reports (also for free). Both of these features are vital to Canadians who are looking to improve their credit score and want to monitor their credit history.
Although credit scores are pretty easy to understand these days, credit reports are often confusing. That’s why Borrowell introduced their new Credit Coach which is an automated assistant that analyzes your credit file and identifies areas that could be affecting your credit score. Let’s take a deeper look at how the Credit Coach works.
Getting started with credit coach
Once you get started with the credit coach, you’ll be introduced to three main sections:
- Credit score
- Credit updates
- Improve my score
It may seem pretty basic at first, but simple is a good a thing. There’s no reason why understanding your credit score or improving needs to be difficult. The general idea is that you’ll get content updates every month when your monthly credit score and report refresh.
Using Credit Coach
As you can imagine, Borrowell’s credit coach is built to help you understand and improve your credit score. When you’re logged in, you can instantly see how your credit score compares to other Canadians in your province and across the country. Although this is a nice feature, I personally don’t recommend you get obsessed with the credit score of others. What matters is your personal credit score so focus on that.
With the credit updates, you’ll really start to get an idea of how things affect your credit score. You’ll instantly be shown what has changed on your credit report over the previous month and how it affected your credit score. For example, you might see your credit score has increased or decreased. You’ll also see any new inquiries on your credit report and be given a heads up if your credit utilization rate has gone up.
Finally, with the improve my score section, the credit coach will give you tips on how to improve your credit. For example, let’s say your credit utilization rate is currently 40%. Well, the optimal rate is 30% so the credit coach would explain that. E.g. If you only have one credit card with a limit of $1,000, you should try to keep the balance under $300.
If one of the things affecting your credit score is late payments on one of your credit cards, the credit coach may recommend a financial product such as a consolidation loan which would help reduce the amount of interest you’re paying.
Why your credit score matters
There are quite a few people out there who believe the way credit scores are calculated is outdated and should be updated, but the reality is, lenders will continue to use it since it’s the only thing that gives them a look at your credit history. If you ever plan on getting a loan in the future such as a mortgage or financing for a vehicle, you’ll want to ensure that your credit score is in good standing.
Check your credit score for free (referral link) via Borrowell on a regular basis so you can monitor progress. If you find that your credit score has taken a hit, be sure to take steps to correct it.