Credit scores in Canada: Equifax, TransUnion and what moves them
Two bureaus, one 300-to-900 scale, and a short list of habits that actually change the number.
Your credit score affects whether you are approved for a loan, a card or sometimes an apartment, and at what interest rate. It is built from a record you can read for free. Most people never look.
Report versus score
Your credit report is a history: your accounts, balances, limits, payment record, and any collections or insolvency. Your credit score is a three-digit number calculated from that report to estimate how likely you are to repay. In Canada, scores usually range from 300 to 900, and higher is better.
Canada has two main credit bureaus, Equifax and TransUnion. Each keeps its own file on you, and lenders don't always report to both, so your two scores can differ. The score a lender sees can also differ from the one you see, because lenders may weight the information differently.
Getting both, free
- Credit report: free online from both Equifax and TransUnion. TransUnion calls it a Consumer Disclosure. Both show information updated monthly.
- Credit score: Equifax offers a free score in every province and territory. TransUnion's score is free with the Consumer Disclosure if you live in Quebec or Ontario. Many banks and apps also display a score.
The FCAC is clear that checking your own report or score does not affect your credit rating.
What moves the number
The bureaus don't publish their formulas, but the FCAC lists the common factors:
| Factor | Helps | Hurts |
|---|---|---|
| Payment history | Every payment on time | Missed or late payments; accounts sent to collections |
| How much of your limit you use | Balances well below your limits | Being close to or over your limit |
| Length of history | Older accounts in good standing | A very short history |
| New applications | Applying only when needed | Many applications in a short period |
| Types of credit | A manageable mix used responsibly | Insolvency or bankruptcy filings |
The FCAC's own example: two people each have a card with a $5,000 limit. One regularly owes $4,500, the other $1,000. Lenders may see the first as higher risk, even if both pay on time. Balances are often reported around your statement date, so paying a card down before the statement closes can lower the utilization lenders see.
Habits that work
- Automate at least the minimum payment on every account, so a busy month never becomes a missed payment. Better still, pay the full balance; see How credit cards work.
- Keep utilization low. Many people aim to keep each balance to a fraction of its limit.
- Think twice before closing your oldest card. Closing it can shorten your history and reduce your total available credit.
- Space out applications. Applying for several cards to collect sign-up bonuses has a cost in hard inquiries, especially before a mortgage or car loan.
Check your report for errors
Read both reports at least once a year, and before any major borrowing. Look for accounts you don't recognize, payments wrongly marked late, and outdated personal information. If something is wrong, contact the bureau that shows it; each has a dispute process. An account you never opened can be a sign of identity theft and is worth acting on quickly.
What a score is not
A score is not a measure of wealth or income, and it doesn't include your savings or investments. Lenders usually look at income, employment and debts alongside it. A good score is a by-product of boring, consistent habits; there is no shortcut worth paying for.
- Get your free reports from both Equifax and TransUnion.
- Set automatic payments on every credit account.
- Keep card balances well below their limits.
- Dispute any error with the bureau that reports it.
Noted.
Sources
Figures in this note were checked against these sources on the date shown above.
This note is general education, not personal financial, tax or legal advice. Rules and figures change; confirm with the source and, where needed, a qualified professional. Terms are defined in the glossary.
