Orientation guide for newcomers to New Brunswick - Government of ...

• credit cards are generally easier to qualifyfor than loans, but they charge a higher rateof interest (often 19 per cent); and• many stores also offer special credit cards.These usually come with rewards for usingthem to buy from that store. Be careful:these cards often have even higher interestrates (often 29 per cent).Lines of credit• lines of credit usually have higher limits andlower interest rates than credit cards, butthey are more difficult to qualify for;• you are able to write cheques and use yourdebit card to draw on your line of credit;and• the bank is required to send you astatement or bill every month if you owemoney.LoansLoans are intended to pay for expensiveitems such as cars or home repairs.You pay them back in installments:the principle plus interest.Some companies offer payday loans. Thismeans they give you the money you wouldget on your pay day, only a few days early.These usually have extremely high feesand interest compared to other ways ofborrowing.CreditYour credit is very important. It is a measureof how likely you are to pay lenders whenyou owe them money. This is done by takingcertain information about your financialhistory and making a credit report. You aregiven a credit rating based on this report.Credit reports may also be obtained bybanks when opening certain types of bankaccounts; or by utility companies whensetting up accounts.Even if you had credit in your home country,you may not have credit in Canada, so it is agood idea to establish good credit here:• show you can handle debt. This meansyou need to borrow money to show thatyou can pay it back. Make sure you have atleast one revolving credit product such as acredit card or line of credit;• keep the balances low on your credit cardsand lines of credit. You should have a balanceof less than 75 per cent of your limit;• pay on time. Paying your utilities and debtslate may hurt your credit; and• do not let people check your credittoo often. All companies must ask yourpermission before they can check yourcredit report. Every check will affect yourrating. If there are several checks in a shortperiod of time, this may be a sign that youmay be trying to borrow too much. Limityourself to only having your credit checkedonly when necessary.For more information on credit or to obtaina copy of your credit report, you maycontact either Equifax or TransUnion. Thesecompanies keep and update your reportsand calculate your rating. They arecommonly referred to as credit bureaus.Equifax:• toll-free, 1-800-465-7166• www.equifax.caTransUnion:• toll-free, 1-800-663-9980• www.transunion.caOrientation guide for newcomers to New Brunswick61