New to Canada? Here’s how Scotiabank’s newcomer offering can help: MoneySense

As a newcomer, you can get personalized financial advice and apply for credit cards that don’t require a long Canadian credit history. This gives you the chance to start building your credit score right away so you can qualify for higher credit limits or better loan terms as you build your life in a new country.

Why your credit score matters

It’s hard to overstate how important your credit score is. This three-digit number reflects your financial habits and history, and it is the number that lenders and card issuers look at when deciding whether or not to approve your credit applications.

Essentially, your credit score tells lenders how risky it is to lend to.

People with a low credit score or those who have no credit score at all will likely find it much more difficult to get approved for loans, credit cards, and mortgages. On the other hand, people with high credit scores are not only more likely to get approved, but may also have access to better interest rates and loan terms.

How to Build a Strong Credit Score in Canada

The credit monitoring agencies, Equifax and TransUnion, look at your personal financial factors to determine your score, but do not weigh these factors evenly. Here are the raw numbers:

• 35% of your score is determined by your payment history: This is your overview of loan or credit payments. Because missed payments can hurt your credit score, you should always do this at least the minimum payment for all your accounts per month.
• 30% of your score is affected by credit usage: This is the available credit that you use. If you use about 30% or less of your available credit, you can improve your score.
• 15% of your score is determined by your credit history: Newcomers are at a distinct disadvantage with this factor, as it takes into account the age of your Canadian credit accounts; foreign accounts do not count.
• 10% of your score depends on your credit mix: Credit bureaus want to see a mix of credit types to see if you are responsible for your finances. Having a mix of auto loans, lines of credit, credit cards, and even student loans in your history can help improve your score.
• 10% of your score is determined by credit applications: Lenders pay attention to how often your credit report is requested, for example when you are looking for new credit. Many fines in a short period of time could indicate that you are struggling financially, so limit the number of credit applications you make to protect your credit score.

Many of these factors take time to develop, which can make it difficult for newcomers to build a good credit score. Fortunately, Scotiabank has a powerful tool for building credit for new Canadians.

How the Scotiabank StartRight® Program works

As most newcomers to Canada quickly learn, you generally can’t take your credit history with you when you move, making it difficult to access loans and other credit products. That’s where Scotiabank is StartRight® program comes in.

StartRight™ allows you to manage your personal finances through Scotiabank, including a checking account with no monthly fees for the first year, credit cards and specialized mortgage financing.

Like a Scotiabank StartRight® Program Member, you can get:

• Up to $700 when you bundle an eligible banking package, savings account and registered account.
• No monthly account fees into a preferred package check account for the first year.
• Unlimited international money transfers without fees from a Scotiabank checking or savings account.
• Apply for credit cards even without an established Canadian credit history, so you can start building a credit score as soon as you’re approved
• 10 free stock trades when you invest at least $1,000 in a new Scotia iTrade® account.

You can make an appointment at any time Scotiabank location participate StartRight™ if you meet the qualifications.

Permanent residents must present one Canadian government-issued ID along with a permanent resident card or Confirmation of Permanent Residence (COPR) document. Foreign workers must present a work permit and one form of identification issued by the Canadian government.

Frequently asked questions

This article is for informational purposes only. Any information, data, opinions, views, advice, recommendations or other content contained in this article are solely those of the author and not of Scotiabank or its affiliates. It should not be relied upon as financial, tax or investment advice or as a guarantee of the future, nor should it be regarded as a recommendation to buy or sell. The information in this article is subject to change without notice.

This is a paid message that is informative, but can also contain a customer’s product or service. These posts are written, edited and produced by MoneySense with assigned freelancers.

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