Believe it or not, credit reports are not infallible. Mistakes happen, and left uncorrected, can have a huge impact on your financial life. That includes your mortgage renewal, perhaps the biggest financial commitment you will ever have.

Before you start shopping around for a new borrowing agreement, take a close look at what's on your credit history and fix any errors. Your score can improve quickly and so will the rates offered by your lender.

Your Credit Report and Mortgages: What's the Connection?

Before you are approved for a mortgage, lenders determine whether you're an acceptable credit risk. Part of that is reviewing your credit report and score. While you may get offers of financing with a less-than-stellar history, it may cost you more than if you had a better score. The difference can mean a lot more money out-of-pocket every month, perhaps even hundreds of dollars.

The score can affect you in unexpected ways. Especially if you've taken steps to clean up your credit history, lender response to your report may come as a surprise. As one mortgage agent recently wrote, one of his clients was offered a renewal at a higher rate with their existing lender, after the couple had finished a consumer proposal to pay off existing debt. The culprit? Poor credit scores.

Fixing Errors and Shopping Around for Rates

In the case of that couple, the fix was checking up on that credit score -- because those figures, important as they may be, are not always based on accurate information. This is good news for consumers, who may not know they have the right to dispute what's on a credit report and ask for errors to be fixed.

Among the more common errors are related to personal identification, like addresses. Sometimes, negative information stays on the report longer than the law allows. In the case of the clients of this mortgage agent, a credit card debt that was part of the consumer proposal was still listed on the credit report as an outstanding obligation.

The lesson is just to have a look at your score, and request an update for anything that looks wrong. You can do this by contacting TransUnion and Equifax, Canada's two major credit bureaus. This is free of charge. The bureaus should take action promptly (Equifax promises resolution within 20 days) and you should see changes reflected in your credit reports.

Then you can start looking around for the best mortgage renewal rates, without fear you'll be surprised by a high rate or outright denial.

Know Your Credit History as Early as Possible

Given the difference that it can make, it's a good idea to review your credit history as soon as you can. That way, you can prepare yourself for the mortgage application or renewal process. You'll also have the chance to fix errors before lenders have the chance to give you a yea or nay for financing.

Check Out Mortgage Options

Your credit history is just one factor that goes into your mortgage choices. To see some of your options, check out mortgage rates on


The RATESDOTCA editorial team are experienced writers focused on sharing stories and bringing you the latest news in insurance and personal finance. Our goal is to provide Canadians with the information and resources they need to make better insurance and financial decisions.

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