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Chexy
The Toronto-based startup Chexy allows tenants to pay rent with any major Canadian credit or debit card, and to build credit and earn rewards in the process. Plus, you don’t need to involve your landlord. When you create an account, all you have to do is upload your lease and enter your rent amount and due date. Then you connect your Canadian debit or credit card (Visa, Mastercard and American Express are all accepted). Your card is charged every month and Chexy e-transfers your landlord.
The service costs $1 per month if you pay with a debit card or 1.75% of your rent if you pay with credit. However, if you want your rent payments reported to Equifax, you’ll need to sign up for Chexy’s Credit Builder program for $9.99 per month (you can get a promo offer of $7.99 per month at the time of writing). If you opt to pay by credit card, you can use the company’s online calculator to see how many rewards (such as cash back and loyalty points) you will earn with the major credit card providers.
Borrowell’s Rent Advantage program
The Rent Advantage program offered by Borrowell allows tenants to report their rent payments to Equifax. Similar to Chexy, you aren’t required to involve your landlord. When you sign up for an account, you provide your lease information and connect your bank account or credit card information (Visa, Visa Debit, Mastercard and Debit Mastercard are all accepted). The service is available for $8 per month and you can cancel at any time. In addition to the Rent Advantage program, Borrowell allows you to compare credit cards, as well as mortgage and insurance rates. By signing up, you can access your credit report and credit score for free.
More ways to build credit
If you’re looking to level up your financial profile, there are other options to build your credit history and credit score from scratch. Here are a few strategies to consider.
Use a secured credit card
If you’re a newcomer or fresh out of school, you may not have enough credit history to be approved for a traditional credit card; you may want to consider some of the newcomer and student credit card options available. Alternatively, you can get a secured credit card that requires a cash deposit that is used as collateral. A secured card can help you build or improve your credit score, but you’ll still be responsible for making payments on time and in full or else interest will accrue.
Obtain a credit builder loan
If you’re looking to get a small loan without an established credit history, a credit builder loan is an option. With a traditional loan, you get the money upfront, which you must then repay with interest over a fixed period of time. With a credit builder loan, the money you pay upfront is put aside for you, but you cannot access it right away. You make fixed monthly payments that include interest over a specified term, and the money is released to you in increments or in full once the entire loan amount has been paid. Credit unions, small banks and online lenders offer credit builder loans. These loans charge high interest, so be sure you can make your payments on time. (Did you know there are loans created specifically for paying rent in Canada?)
Get a cell phone plan
Having a post-paid cell phone plan can help you build your credit. When you make your payments, the major cell phone providers will report this to the credit bureaus. Be sure to pay on time and in full so that it positively affects your credit score.
Patience is a virtue
Rome wasn’t built in a day and neither will your credit history and score. Learning and mastering different credit building techniques will take time. But building good financial habits now will help you down the road when you’re looking for the offers on credit products or to get approved with a new landlord. Hopefully, with the above tips in mind, you’ll be well on your way to getting the credit you deserve.
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