Understanding your credit score
Updated over a week ago

Our credit scores influence many aspects of our finances. Having a low score or no score can lead to financial troubles and headaches. Today, we'll share some tips to help you improve your credit score using the Credit Building tool!

First, let's understand what those credit score numbers mean:

  • Credit scores range from 300 - 900

  • 300 - 579: Poor

  • 580 - 659: Fair

  • 660 - 719: Good

  • 720 - 779: Very Good

  • Above 780: Excellent

When working to improve your credit score, your best friends are consistency and time. It is unlikely to see your credit score have a big increase unless something big comes off of your credit report. Here are the factors that affect your credit score, how much they influence it, and how KOHO our Credit Building can assist you!

Payment History (~35%): Avoiding late and missed payments.

  • Making consistent on-time payments on your Credit Building tradeline (line of credit).

Credit Utilization (~10%):Use less than 30% of your credit limit, aiming for over 1%.

  • When using your tradeline (line of credit) make sure to set your utilization each month. For our Credit Building products, we recommend keeping the amount you use under 10% of the amount you have available to you.

Credit History (~15%): Having open accounts that you have had for a while will help your score.

  • The longer you use our Credit Building Products, the better for your credit score.

Inquiries (~10%): Every time you give your consent for a potential lender to pull your credit report it can impact your credit score.

  • Good news! KOHO does not submit a hard inquiry when you sign up for our Credit Building products!

Derogatory Marks (~10%): This is where items like bankruptcies, items in collection, or any other significant negative events will be documented.

  • Avoid late payments and negative events. We'll collect missed Credit Building payments until fully paid.

In short, on-time payments, responsible credit use, and a longer history will boost your credit score using KOHO Credit Building products.

When will KOHO appear on my credit report?

When you sign up for our Credit Building products with KOHO, you'll notice "KOHO" on your credit report during the second week of the following month after you registered. For instance, if you signed up in early December, you'd see "KOHO" on your credit report in the second week of January.

Why is my score different than another reporting service that I use?

Presently, KOHO’s Credit Building products gets your score straight from Equifax. Your credit score could be different from what you see on other credit score services because Canada has two big credit bureaus, and they use different methods to calculate it!

If your score looks different, even with the same bureau, check your personal details on your Equifax account like your name, birthdate, address, and phone number. After updating this information, it takes 4 to 6 weeks for the changes to show in your credit report.

You can contact Equifax at 1-800-465-7166, or you can also log into your account on Equifax's website.

Why did my credit score go down?

When you first sign up, we open a new tradeline in your name, which might temporarily lower your credit score. But don't worry, this is a step towards building a good credit history, which will gradually raise your score as long as you work on improving your creditworthiness.

Making payments on time is crucial for a strong credit score. Make sure you have enough money in your KOHO account to cover any withdrawals. If you've missed payments outside of KOHO, like missing car payments or credit card bills, trying to get too much credit quickly, or not paying back loans, this will also hurt your credit score.

Your credit score in KOHO comes from Equifax. If you've recently updated your personal information like your name, birthdate, address, or phone number, it's a good idea to check and update this info on your Equifax profile too. Keeping your details consistent helps make sure everything is accurate.

You can contact Equifax at 1-800-465-7166, or you can also log into your account on Equifax's website

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