Your credit score is a three-digit number between 300 and 900 that summarises your creditworthiness based on your borrowing and repayment history. Lenders, landlords, and even some employers in Canada use credit scores to assess risk. Understanding how yours is calculated — and what you can do to improve it — is one of the most useful financial skills available to Canadian adults.
The Canadian Credit Score Scale
| Score Range | Rating | What It Means |
|---|---|---|
| 760–900 | Excellent | Best rates; approved for virtually all products |
| 725–759 | Very Good | Near-prime rates; approved for most products |
| 660–724 | Good | Approved for most credit; some rate premium |
| 560–659 | Fair | Approved for some credit; higher rates |
| 300–559 | Poor | Limited approval; secured cards; high-interest products |
Canada uses a 300–900 scale — different from the US 300–850 FICO scale. A 760+ score in Canada is generally equivalent to “excellent” regardless of which bureau calculates it.
The Two Canadian Credit Bureaus
Canada has two major credit bureaus:
| Equifax Canada | TransUnion Canada | |
|---|---|---|
| Headquarters | Atlanta (US parent); Canadian operations | Chicago (US parent); Canadian operations |
| Canadian office | Montreal | Burlington, Ontario |
| Free annual report | Yes (by mail or online at equifax.ca) | Yes (online at transunion.ca) |
| Consumer products | Equifax Complete, Equifax ID Patrol | CreditView Dashboard, TransUnion |
Not all lenders report to both bureaus. Your Equifax and TransUnion reports may differ slightly depending on which lenders and creditors have reported your payment history. Always check both when assessing your overall credit health.
What Factors Determine Your Credit Score?
Canadian credit scores are calculated using five key factors, weighted approximately as follows:
1. Payment History (~35% of your score)
The most important factor. Every on-time payment positively reinforces your score. A single missed or late payment — even by 30 days — can drop a good score by 50–100 points and remains on your report for 6 years.
What counts: Credit card payments, mortgage payments, car loan payments, student loans, and lines of credit. Utility bills and rent typically do NOT appear on your credit report unless they go to collections (though some services like Chexy allow rent reporting).
2. Credit Utilisation (~30% of your score)
The percentage of your available revolving credit you are currently using. Lower is better.
| Utilisation Rate | Impact |
|---|---|
| Under 30% | Generally positive |
| 30–50% | Neutral to slightly negative |
| Over 50% | Negative |
| Over 75% | Significantly negative |
Example: If you have a $10,000 credit card limit and carry a $3,000 balance, your utilisation is 30%. Paying down to $1,500 (15%) would meaningfully improve your score.
Tip: Your utilisation is measured at your statement date — not just when the payment is due. Paying your balance before the statement date lowers the utilised balance that gets reported.
3. Credit History Length (~15% of your score)
The age of your oldest account, your newest account, and the average age of all accounts. Longer history = higher score.
Implication: Don’t close old credit cards, even if you rarely use them. Closing an old card shortens your credit history and lowers your average account age.
4. Credit Mix (~10% of your score)
The variety of credit types you manage. A mix of revolving credit (credit cards, lines of credit) and installment loans (car loans, mortgages) demonstrates broader credit management ability.
5. New Credit Inquiries (~10% of your score)
Hard inquiries from new credit applications temporarily lower your score by a few points. Multiple applications in a short period signal credit-seeking behaviour and have a compounding negative effect.
Exception: Multiple mortgage, auto loan, or student loan inquiries within a 14–45 day window are typically counted as a single inquiry by scoring models, recognising that consumers shop for the best rates.
How Credit Scores Are Used in Canada
Credit Card Applications
Lenders use your credit score to determine approval and set your credit limit. Premium cards (Visa Infinite, Mastercard World Elite) typically require scores of 660+; many prefer 725+. Secured cards have no minimum score requirement.
Mortgages
Most lenders require a minimum credit score of 600–620 for an insured mortgage. Better scores unlock lower interest rates. At prime rates, a 760+ score may qualify you for a rate 0.5–1.0% below what a 660 score earns — worth tens of thousands of dollars over a mortgage amortisation.
Car Loans and Leases
Dealerships and lenders check credit scores for financing. Scores below 600 often mean higher interest rates or deposit requirements. Prime auto financing typically requires 660+.
Rental Applications
Landlords in Canada may request your credit report (with your consent) as part of a rental application. A higher score signals financial reliability. Landlords cannot check your credit without your written consent under PIPEDA (Personal Information Protection and Electronic Documents Act).
How to Access Your Credit Report
Free options (recommended):
- Borrowell — Free Equifax score and report; updated weekly; available at borrowell.com
- Credit Karma Canada — Free TransUnion score and report; updated weekly; available at creditkarma.ca
- Scotiabank, National Bank, CIBC app — Some banks provide free credit score monitoring within their apps (typically powered by Equifax)
- Equifax.ca and TransUnion.ca — Free annual credit report by mail or online (score may cost extra)