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Migrating your life to another country feels daunting, intimidating, nerve-wracking, and whatnot.

From thinking about finding a new job to getting a new credit card, everything seems like a challenge you fear failing.

Of course, it’s understandable.

You have to start everything from zero and build everything from scratch.

Whether it’s your career, house, or Equifax credit score.

It doesn’t have to be this hard! Well, what if it really isn’t? Yes!

You can still build a good score, history, and life for yourself as a newcomer in Canada if you know the basic tips and tricks to settle in.

Want to know how? Here you go:

Why Is Building Credit Important In Canada?

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Because your life depends on it! Literally!

A good credit score is a key to flexible loan terms and reduced interest rates on your mortgage and credit card.

You'll be able to use this to finance a car purchase, a house, education costs, and more.

In fact, you can also save some bucks on your mobile phone plan thanks to your perfect score.

Still, if you have the question:

What makes Canadian credit so important?

We are happy to answer:

• If you want your new life in Canada to be struggle-free and full of credit perks and bonuses, you must satisfy the lenders!

And you got that right.

• Your good credit score will make sure that all the lenders, banks, and loan providers will trust you with their money and services.

Now the question is, you just shifted to Canada; you’re a newcomer! So what score do you actually improve?

Let’s read in the next section.

What Is The Credit Score Of A New Canadian Immigrant?

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Every newcomer in Canada has to start with a zero credit score. Yes, you read that right.

Due to no global framework for credit reporting, your previous credit will become nonexistent in Canada.

The reason is every country runs on its own set of credit rules. So, it becomes hard to decode everything on your report per their terms.

So, in simple words, you need to start a new credit life when you shift to Canada.

Of course, with continuous effort and good financial practices, you can build your score to a good range in no time.

Why Is It Hard For Newcomers To Get Credit In Canada?

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New Canadian immigrants find it difficult to get credit in Canada as their score is basically nonexistent.

They have nothing on their credit profile to show to lenders.

So, as a result, their options to get credit become limited.

One has to have a top credit score to get a top credit card in Canada.

Lenders consider the following standard while deciding to approve or reject your card application:

• No credit: zero
• Bad credit: 300 to 559
• Above-Average credit: 660 to 724
• Good credit: 725 to 759
• Excellent credit: 760 to 900

Some service providers only accept good or excellent scores. While others also accept above-average credit.

And everything below that is almost not acceptable for a card, loan, or any lending application.

Is there any card for people with bad credit? Any credit building option for newcomers in Canada? Yes!

A secured credit card!

So, how can a newcomer in Canada effectively build a credit history? Here you go:

Credit Building Tips For Newcomers In Canada

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Building credit seems difficult for Canadian immigrants, especially if they don't know what to do or avoid.

So, here are some tips for figuring out credit mistakes you must avoid:

1.  Get A Secured Credit Card!

A secured credit card is the best pick for a newcomer in Canada or anyone struggling with bad credit.

Let’s read some convincing reasons why:

• Approval terms are usually easier to comply with,
• Interest rates are flexible,
• Security deposit is low and affordable.

And the best part, there’s almost no credit check!

All the reasons newcomers need to register for a secured credit to build a credit history in Canada.

Moreover, it’s easier to manage as you can start with a low credit limit that can help you avoid overspending.

2.  Ask The Renter To Report Your Credit!

What’s worse than having no credit? No living place.

When you are struggling financially and personally, the lenders will only get alarmed that you don’t know how to manage your money!

So, the first thing after getting a credit card is looking for a place that can help with your credit.

Yes, your housing or rental can help you build history. Here’s how to do that:

• Pay the lease upfront,
• And ask your landlord to report your timely payments to the LCB.

It’s possible!

However, it might be hard to find landlords that can go out of their way to report your payment history to the bureaus.

3.  Establish Yourself Financially!

A stable job, steady earning, and passive income can help your credit.

On the other hand, your credit building will become even harder if you are struggling to pay bills or meet the daily necessities.

• Find ways that can help you increase your income.
• Ask the credit company or lenders for reduced prices so you can clear them timely.

Another tip is to find mobile phone, internet, or cable services that offer credit reporting.

The main reason to do so is you need to try anything and everything which can help your case when you are starting with your credit.

4.  Look For Immigrant’s Plan!

If you do the research, you might also be able to find banks or credit card companies that offer credit-building programs dedicated to immigrants.

You can ask your credit card provider, a top-rated bank, or any family friend that can recommend something helpful for your credit.

5.  Never Miss Your Payments!

Although, it’s a given to avoid credit inquiries when you are a newcomer. But still, some people need to hear that!

Your bad financial habits will only slow down your credit-building process.

• Set a low credit limit to keep your credit utilization low,
• Clear your outstanding balance monthly to avoid any late or missed payments,
• And use your card responsibly.

Yes, you need to use your card to add financial activity to your credit report.

But anything over the limit will ruin your credit-building chances.

How Does Credit Work For Newcomers In Canada?

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Well, the answer is typical.

The Canadian credit scoring system works the same for new, old, and every Canadian resident.

• Recent payment activity,
• Late or missed payments,
• Unclear payments,
• Used and available credit,
• Debt-to-credit ratio,
• Credit limit,
• Credit utilization

All these factors play a vital role in deciding your credit score.

The reason why every financial expert guides newcomer to start with secured credit as their first Canadian card.

Final Thoughts

Shifting to a new place is really like starting a second life.

You have to start everything from scratch with no experience on hand. Of course, you can apply some tricks from your previous area.

But, honestly, it’s not that effective.

Because every country has its own rules and regulations for immigrants and newcomers.

So, it’s becoming even harder for beginners to settle in and build credit to live a life full of benefits.

Not anymore!

This guide has everything a newcomer needs to know while shifting to Canada.

New job? Yes sir. New card? Yes sir. New House? Heck, yes!

Whatever you’re doing, you need to pick the options that go with your credit building.

Confused much? Read the complete guide to find the answers!