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Credit repair in Canada

Tired of bad credit limiting your financial options? Learn how to repair your credit so you can have a credit score to be proud of.

When you have less-than-stellar credit, managing and improving your finances is key to giving yourself the best chance of lender approval. If you don’t know where to start or need some help to repair your credit, you’ve come to the right place. A credit repair agency could be a tool to get you there more quickly.

Use our table of contents to learn more about credit repair agencies, do-it-yourself credit repair, the importance of a solid credit report, what the credit repair process entails and how to compare your options to find the top agency for your needs.

Quick guide to your credit report

Your credit report is a detailed record of your borrowing history — credit cards, bank accounts, mortgages, other loans and more. It lists applications you’ve made for all forms of credit (whether approved or not), your repayment history, details of any defaults or bankruptcies you may have, your current debt, information on the accounts you currently hold and any court judgments against you

Lenders and other providers use this information to asses the risks of giving credit to someone.

What is credit repair?

Credit repair involves cleaning up negative information on your credit report that may have slipped through the cracks, such as errors and delinquent accounts. You can do it yourself or you can hire a credit repair agency to clean up incorrect or duplicate listings on your credit report.

Credit repair agencies are experts at credit legislation and spotting these erroneous listings — holding credit bureaus, banks, debt collectors and lenders accountable for reporting accurate information.

What do credit repair companies do?

The process of credit repair varies by company, so ask about the specific agency’s process before you apply. Generally you’re offered a complimentary initial consultation, after which you or the agency will:

  • Read your file. The agency carefully reviews your credit report for incorrect listings and methods available to improve your score.
  • Apply for credit repair. You’ll complete a form detailing the listings or faults you want the agency to examine.
  • Accept your claim. If the company decides it can help you, it will accept your application and start looking into your credit history.
  • Contact creditors. The agency will contact your creditors to determine which defaults can be removed from your report. An agency may also help negotiate a debt repayment plan with creditors if you owe a debt.
  • Pay a fee. You may pay fees throughout the process to cover the time needed to address incorrect listings.
  • Remove listings. If the credit repair agency is successful in its negotiations, the creditor will remove the erroneous listings from your file.

How to compare credit repair agencies

Consider the important factors below when weighing whether an agency is reputable.

  • Transparency. How up front is each company about the fees you will have to pay? Look for a company that provides the full terms and conditions of its services before handing over your money.
  • Reputation. Is the company a trusted name in the industry or have a history of satisfied customers? Look for a respected company with an impeccable service record.
  • Customer reviews. Online review sites can give you an idea of the experiences other people have with these agencies — and, importantly, how each company treats its customers.
  • Overall cost. Cost is obviously an important factor to consider, but you’ll want to find the ideal combination of affordable price and quality services.

Work with a credit repair company today

DIY credit repair

Repairing your credit on your own takes patience and time. You’ll have to order your credit report, scan it with a sharp eye to make sure everything looks right and then start dealing with different credit bureaus and lenders to fix mistakes that could be dragging your credit score though the mud.

But if you’re ready to get started improving your credit score through credit repair, here’s the process to repair your credit.

1. Find the causes of your bad credit.

It’s easiest to start repairing your credit if you know what’s been getting you in trouble. First, get a copy of your credit report — it’ll show you the negative items that led to your poor credit score. By federal law, you’re allowed to get a free copy of your credit report from the major credit bureaus every 12 months.

When you receive your reports, look for 3 things in particular: inaccurate information, past-due accounts and maxed-out accounts.

2. Dispute inaccurate information.

First, go after the lowest-hanging fruit — the errors on your credit report. If you find information that’s incomplete or inaccurate, you can have it removed or changed. Look specifically for:

  • Debt you’ve already paid.
  • Accounts you’ve closed that are reported as open.
  • Incorrect credit limits.
  • Accounts that are current but reported as past due.
  • Incorrect account balances.

On your credit report, you’ll find instructions for disputing errors. You can submit disputes online or through phone or mail.

According to many experts, mail is the best way to submit your dispute. For one, you can include more hard evidence that supports your case. Note that submitting a dispute online can tie your hands: By agreeing to the terms of an online form, you may waive your right to sue a credit bureau if you’re unhappy with how it’s investigating your complaint.

MUST READ: How to correct an error on your credit report

Keep these tips in mind while submitting your disputes:

  • Don’t send your disputes in one letter. Instead, send one letter per dispute. This will typically help your disputes get resolved faster.
  • Send your disputes through registered mail, and request return receipts. This way, you’ll have proof when you sent each dispute and when the credit bureau received your dispute.
  • Stay organized. Start a spreadsheet on your computer to document every error you’ve disputed. Make a copy of every letter and piece of evidence you send. It’s a good idea to keep multiple file folders, one for each credit bureau.
  • Be clear in your dispute letters and write simply. You don’t need flowery language for a dispute. Just state your case as simply as possible.
  • Line up your evidence. Back up your dispute with as much information as you can. This will make it easier for the credit bureau to investigate your claim.


    You can dispute as many items as you’d like. However, consider keeping the number of disputes under five a month. Sending more could result in credit bureaus considering your disputes frivolous.

    3. Get current on past-due accounts.

    While being in debt doesn’t necessarily hurt your credit, late and missed payments most certainly will. Here are some helpful numbers to help you better understand past-due accounts:

    • Soon after you miss a payment due date. Your credit card account is marked “past due.” It’s not yet reported to the credit bureaus, so your credit score isn’t affected.
    • After 30 days. Your past-due account may be reported to the credit bureaus. If it is, your credit score can drop. At this point, your credit won’t be affected too heavily if you get current on your payments quickly.
    • After 60 days. At this point, your credit is heavily affected. Your card provider may raise your interest rate to the maximum penalty rate.
    • After 90 days. Your card provider could send your account to a third-party debt collector, which will start contacting you for repayment.
    • After 120 days. As your credit score continues to slide, you’ll receive debt collection calls that become increasingly urgent.
    • After 180 days. Typically, your credit card account is charged off. This means your card provider marks your debt as unlikely to be collected and takes it off its balance sheet. A charge-off severely affects your credit score, so avoid it at all costs.

    Your first priority is to avoid charge-offs on your accounts. Focus on past-due accounts that are delinquent for fewer than 180 days.

    Contact your creditor to explain that want to do everything in your power to get current on your account. They may be willing to work with you to make repayment easier — for example, by letting you repay over a period of time instead of all at once.

    If you’re lucky, your creditor may re-age your account. This means they’ll report your account as current after you work out a debt repayment plan with them.

    Next, pay off accounts that have been charged off. If your debt is charged off, it may sound like you don’t have to pay it. Unfortunately, you’re still on the hook for payments. If your creditor sold your debt, you’ll make payments to a third-party debt collection agency.

    Paying a charged-off account probably won’t improve your credit score much, if at all. However, it’s much better for your account to show “paid charge-off” instead of “charge-off.” If your credit history still shows you haven’t paid your debts, lenders will be wary about extending credit to you. Paying off your accounts — even charged-off accounts — gives you a better chance of approval for new loans.

    4. Fix your credit utilization ratio.

    By getting current on your accounts, you tackle the factors that make up 35% of your credit score. Now, it’s time to fix your credit utilization ratio, which makes up 30% of your score.

    Credit utilization ratio is simple: It’s how much of your total credit you’re using. Say you have 2 credit cards, each with a $500 balance and a $1,000 credit limit. This means you have $1,000 in total balances and $2,000 in total credit. Your credit utilization ratio is $1,000/$2,000 — or 50%.

    Because you have bad credit, chances are that your credit utilization ratio is very high. This weighs down on your credit score. To increase your score, focus on decreasing your credit utilization ratio.

    Over time, pay off your credit card balances. Most experts recommend keeping your credit utilization ratio under 30% for each credit card.

    5. Add new sources of credit.

    Erasing damage to your credit score can feel like digging yourself out of a deep hole — it’s tough, but doable. After you’ve made significant progress, it’s time to find new ways to build your credit.

    One of the best ways to add new credit is by getting a credit card. Since you have bad credit, focus on secured cards and store cards. Also, consider becoming an authorized user on someone else’s account or applying for loans.

    The pros and cons of credit repair


    • Improve your financial standing. Even if you’re successful in removing only a few negative listings from your report, the result can improve your chances of being approved for credit.
    • Save money on future borrowing. With an improved credit score, the rates that you pay to borrow money — for example, with a personal loan or mortgage application — could save you significant money over the life of a loan.


    • Services can be expensive. Whether you pay by the month or with each removal, credit repair will cost you.
    • No guarantees. After all that hard work, you may be unsuccessful in removing your negative listings.

    Bottom line

    Improving your credit score can be a slow process and enlisting the help of a credit repair agency could move you more quickly along to the road to a clean credit report and better credit score. But because credit repair agencies can charge you a fee for every listing they remove, you might want to first attempt to resolve the issues yourself.

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