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Changes to Your Credit Score

Credit-ScoresImportant new changes will soon affect how your credit score is calculated.

Fair Isaac, who sells the formula by which most Canadian’s credit scores are based, has tweaked their model.

Shopping multiple lenders on your own will now no longer have as big an impact on your score.  Now, all mortgage lender inquiries within 45 days will count as one inquiry.  It was previously 14 days.  (If you use a mortgage broker to shop for your mortgage they usually make only one inquiry anyway).

In addition, Fair Isaac says, “By studying large samples of Equifax Canada’s credit reports, we found that consumers are opening more credit lines, carrying higher balances, and generally using credit to a greater degree than ever before.”  As a result, don’t be surprised if credit scoring formulas tighten up a bit (become slightly more conservative) to help lenders better manage their risk.