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Ensure Debts are Erased to $0 Balance Owing

Now that you have your Absolute Discharge, you need to clean up your credit score, or ensure that it is clean already. The Office of the Superintendant of Bankruptcy (Industry Canada Office) will normally send a copy of your bankruptcy documents (Statement of Affairs and Absolute Discharge) to Equifax and TransUnion so that the updates CAN be done to your credit score. Due to privacy issues, Industry Canada normally will not confirm the contents of your credit score to ensure it is clean and accurate, nor is it their job to do so either. It is very common to see multiple errors on credit scores. Once bankruptcy erases debt, your existing balances should read $0, however, they often remain at pre-bankruptcy balances. This problem of balances still reporting ultimately prevents clients from any lending for a very long time as your credit score will remain very low due to the negative effects are still being reported inaccurately. Once your bankruptcy is discharged, the negative effects should stop the day you are discharged. IT IS YOUR RESPONSIBILITY TO CLEAN UP YOUR SCORE. If you are experiencing difficulty gaining credit after your bankruptcy, it is very likely that you are experiencing this issue of not having a clean credit report and you should proceed to download the forms below for both Equifax and TransUnion to fix this issue.

The good news is that once a credit score is cleaned up, it is relatively easy to gain secured credit instantly and easily on the right products. After a little bit of time of being responsible with that secured credit, you can eventually gain unsecured credit again and even vehicle financing before being discharged for more than 2 years. A clean score is your #1 key to getting back on track. It is a hard, difficult, drawn out process cleaning your score, but you will only have to do it once if you do it right the first time and follow my directions. Read below on how you can clean up your own credit score using our documents we've helped provide for you, so that we can gain a mortgage for you with a low rate.

A Clean Score = No Red Flags

The biggest reason why it is very important to clean your score is that it makes it easier for lenders to understand your score, while increasing your credit score number itself. If there are items that look like there are debts owing AFTER a bankruptcy, that is a huge red flag that becomes a NO LEND situation for pretty much any lender. Most loans officers are not experienced enough to see past this and will automatically decline you, even though you would pass them your bankruptcy documents and prove to them that it was included. IT NEEDS TO BE ACCURATE ON YOUR CREDIT SCORE. Your credit score is your best asset to work on after your discharge since it seems like 90% of Canada runs on credit. Understand that most lenders panic when they hear the word bankruptcy, banks are lenders not charities. You should be choosing to work with people that understand how to recover and that provide you the tools to recover is a great asset. Most lenders will verbally state `get a credit card and call me in 12 months` because they really don't understand the credit recovery system. This Step 2 process was CREATED BY US, nobody else has produced this information, it was months of dedicated work developing it for you. We took the time and called both Equifax and TransUnion talking with managers of departments so that not only would their staff be able to get it right the first time, but then we could outline to YOU exactly what both of them want to see from you in paperwork, in order for them to do their job right in fixing your score. We know this process better than anyone else out there and when it comes time to get a mortgage, please call us first.

The included debts with the bankruptcy will continue to report as an R9 or I9 status for the next 6 years on your credit score and the Date of Last Activity should read the date of your Absolute Discharge. If you have not already cleaned your score, and a few years have passed, you will see a huge leap in your credit score number once you complete Step 2 since all the negative effects of not having a clean score will be deleted back to the date of your discharge. So if you haven’t done this yet, you will benefit from this process dramatically, and surprising see a big increase in your score and will give you the biggest leap to having good credit again.

Steps on How To Clean Up Your Credit Score Yourself

It is very easy to fix your score. You don’t need to order your score to start the process. Follow our easy steps below to fix your credit report. Remember to fix one applicant’s score at a time, repeat the process for each individual’s credit file... do not try to combine person files. One submission per person. If you filed bankruptcy jointly, you need to do two submissions.

1)   Ensure you have copies of your Absolute Discharge and Statement of Affairs. These documents outline the date your were released from your bankruptcy, and it outlines the debts that were included within your bankruptcy. If you cannot find these documents, call the nearest Industry Canada office to order free copies of these documents. Click here to look up the closest Industry Canada office nearest you. (Industry Canada is also known as the Office of the Superintendent of Bankruptcy of Canada)

2)   Ensure you have 2 forms of valid and current identification, one of which being photo identification. Photocopy the front and back of the identification as the credit bureaus will want you to send that in with your bankruptcy documents. Normally driver’s licences, passports, birth certificates are preferable forms of ID. Ensure the Photo Id has your mailing address on it. Sometimes the address is directly printed onto the photo ID, if it is not, include the paper copy with your ID that states your address. Ensure you photo copy your photo and signature portions of the ID on 3 different photocopier settings, and include ALL 3 settings in your fax or mail package. I would suggest a medium setting, a lighter setting and the lightest setting as sometimes faxing ID can darken the copy dramatically.

3)   FOR EQUIFAX:

a. Download, open and print the Equifax Fax Cover Sheet. Fill out the fields within the fax cover sheet with your personal information, and your contact information. Once you are finished with that page, turn it upside down beside you.

b. Download, open and print the Equifax Letter of Intent stating what your intentions are (having your credit reporting accurately), what the issues are, and what Equifax needs to do to resolve the matter. Ensure you sign this document at the bottom where the signature line is. Once you have finished with that page, turn it upside down beside you on top of the Equifax Fax Cover Sheet.

c. Place your multiple copies of photocopied identification (read item #2 above in full to do this properly) and place the ID upside down on top of the Fax Cover Sheet and Letter of Intent

d. Place your Absolute Discharge on the pile as well, then followed by your FULL Statement of Affairs which outlines the debts & assets included within your bankruptcy.

e. Fax that entire package of documents, or you can also mail the package in full to:

      Equifax
National Consumer Relations
P.O. Box 190
Station Jean-Talon
Montreal, Quebec
H1S 2Z2
Fax: (800) 314-7851 - it's on the fax cover sheet also

4)   FOR TRANSUNION:

a.  Download, open and print out the TransUnion Fax Cover Sheet. Fill out the fields within the fax cover sheet with your personal information, and your contact information.

b.  Download, open and print out TransUnion Investigation Form. Fill out the form with your personal information, and contact information. Once you have finished with that page, turn it upside down beside you on top of the TransUnion Fax Cover Sheet.

c.  Download, open and print the TransUnion Letter of Intent stating what your intentions are (having your credit reporting accurately), what the issues are, and what TransUnion needs to do to resolve the matter. Ensure you sign this document at the bottom where the signature line is. Once you have finished with that page, turn it upside down beside you on top of the TransUnion Investigation Form.

d. Place your multiple copies of photocopied identification (read item #2 above in full to do this properly) and place the ID upside down on top of the Fax Cover Sheet and Letter of Intent. Remember that TransUnion will be looking for clarity of signature on the Identification, and compare it to the letter of intent signature. They also are looking to see that your ID has your name, mailing address, and your birthday on the identification. Take your time and read carefully the TransUnion Fax Cover Sheet. Ensure you are enclosing what you say you are enclosing from that sheet. 

e. Place your Absolute Discharge on the pile as well, then followed by your FULL Statement of Affairs which outlines the debts & assets included within your bankruptcy.

f.  NOTE: TransUnion will match your signature from your photo identification to match your signature on your TransUnion Letter of Intent. If you choose to fax your documents in to TransUnion, ensure you have sent 3 different "shades" of ID with your photocopies as faxing ID is not reliable at all. It would be my recommendation to mail the package by Xpress Post to TransUnion, however the fax cover sheet does have the fax number on it, and it may not hurt to try faxing it first, but TransUnion specifically stated they have minimal success with faxed applications and greater success with mailed applications:

      TransUnion
Consumer Relations Center
P.O. Box 338 LCD 1
Hamilton, Ontario
L8L 7W2
Fax: (905) 527-0401 - it's on the fax cover sheet also

5)   Wait for 4 weeks or 20 regular business days and then order a copy of your free credit score from Equifax, and TransUnion. Look through your score and ensure that your credit score has $0 balances owing on all trade lines on your score. R9’s and I9’s statuses are normal. Ensure the Date of Last Activity is now reporting from your discharge date on all trade lines that were included within your bankruptcy.

Note: As a member of these credit reporting agencies, I would have the ability to submit these documentson behalf of you the consumer if I have an active credit score on file for you. There are fees that I get charged for doing this, and the timeline can be as little as 72 hours from submission to update. Preferably I would not like to submit your documentation for you as it is expensive for me and very time consuming for my staff, however, if your mortgage is urgent, I have made exceptions and have had success with this in the past for clients in the 72 hour process. Use the "just ask" section if you have any questions.

Congratulations! Your Past is Now Behind You!

Congratulations! You have now completed the most important step in turning the corner to recover from bankruptcy. You have successfully cleaned up your past, and you only have the future to look forward to. The more time that goes by, the less you will hear about your bankruptcy, and the easier lending will become. Although lending will not be easy at the start, there is nothing more you can do about the past and it is clearly behind you. You don’t have to do anything else about it anymore. You have only a positive future is ahead of you!

Proceed to Step 3

If you have already confirmed that your score is reporting correctly Proceed to Step 3. If you are confused on whether or not you have successfully completed this stage or not, Ask Us your question by using our online contact form here.
Step 3 - Gain New Credit