Here’s The Average Credit Score for Canadians

Your credit score has a large impact on your financial future when you apply for credit.

When you’re shopping for loans and comparing lenders, it’s important to understand your credit score and how it compares to the average Canadian’s.

Let’s go over what a “good” credit score is, how you can get there, and its benefits.

What’s Considered a Good Credit Score in Canada

To have a credit score that the reporting bureaus consider “good,” your score must be at least 713.

Scores from 713 to 740 are good, and scores from 741 to 900 are considered “excellent”.

Having a good credit score typically means that you’re almost certain to be approved for credit products with industry-standard rates.

You should qualify for better than average rates for car loans, mortgages, and other personal loans.

Credit Scores in Canada Explained

There are 2 major credit bureaus in Canada:

  • Equifax
  • TransUnion

In Canada, personal credit scores range from 300 to 900, and 650 is the average, according to TransUnion.

TransUnion

While 650 is the average TransUnion credit score across Canada, averages then vary widely by province and age group.

TransUnion Canada provides less information publicly than Equifax.

Their site is vague and refuses to provide a definitive range.

However, banks they work with do have a specific set of score ranges.

A “good” TransUnion credit score, according to RBC, falls between 790 and 832.

If you fall into this category or the one above it, you can expect consistent approval for credit if you meet the lender’s other requirements.

Credit written on desk

Equifax

Equifax Canada considers a credit score of 725 to 759 to be “good”.

Scores from 760 to the maximum score of 900 are considered “excellent”.

According to Equifax Canada, you can expect to get “decent” interest rates with good credit scores.

However, the company suggests that it is worth the effort to work your way up to an “excellent” rating.

With an excellent Equifax credit score, they suggest you are “almost guaranteed” approval for any loans you apply for, so long as you meet any other requirements, such as income and debt-to-income ratios.

How To Improve Your Credit Score

1. Order A Credit Report

You can get a free credit report from both of the major credit reporting bureaus.

They each offer a quick, free credit report on their websites.

Your credit report will provide a detailed explanation of your credit score.

It will go over all the transactions that led to that score.

You can then understand what is holding your credit score back.

It will always take time, budgeting, and discipline to raise your credit score.

But that process is always easier when you know exactly what is holding your score back.

Another way checking your credit score can help is by discovering errors.

Credit bureaus aren’t perfect.

They sometimes make mistakes, and you can demand a review of a specific charge for free.

If you identify a mistake, report it, and it is investigated and found to be a mistake, it will be removed from your report.

This can result in an immediate increase in your credit score.

Checking your credit report can also help you reveal instances of fraud.

If you find any items on your report which you did not authorize, report them to the credit bureau immediately.

This outcome is often the result of identity theft.

If you’re the victim of identity theft, contact both your credit bureau and credit card provider immediately.

They will correct any fraudulent charges and secure your account so that the fraudster cannot continue to steal from you.

2. Upfront Repayments

A lot of the time, the solution to a low credit score is long-term.

It takes consistent, timely repayments of borrowed money to get your credit score as high as possible.

However, some large, short-term repayments can produce faster results as they will reduce your credit utilization, which can reflect in a higher score.

Like correcting mistakes or reporting fraudulent actions on a credit report, making large repayments can have a faster effect.

3. Fewer Hard Credit Checks

Getting a free credit report requires a soft pull of your credit score, which won’t reduce your score.

However, some actions require a “hard” credit pull.

Hard pulls will affect your credit score in only a slight way.

But repeated hard inquiries over a short period will have a more noticeable impact.

  • Credit card applications.
  • Rent applications.
  • Certain job applications.

The “soft” pulls on your credit score will appear on your credit reports as well.

However, they are only visible to you and they do not affect your credit score at all.

4. Diversify Your Credit Sources

Having just one credit card and making timely, full repayments will increase your credit score – to a point.

However, utilizing only a few types of credit isn’t as effective at increasing your score as having a few different types of credit accounts.

If you responsibly utilize multiple types of credit at the same time, your credit score will rise faster.

For example, instead of having one credit card, you can try to mix in:

  • Two credit cards
  • A car loan
  • A mortgage
  • A line of credit

5. Give Your Accounts Time

Opening too many credit accounts in a short time does not help your credit score.

In some cases, it will even lower it a little bit.

Having a credit account open for a long time will help your credit score rise faster.

Having older accounts where you made repayments on time and in full is a faster way to increase your score.

For these reasons, it’s important to remember that when you transfer an older account into a new account, the new account will be treated as a brand new credit.

6. Use Credit Well

Last (but certainly not least), use your credit well.

Using a diverse range of credit accounts wisely, responsibly, and for a long time is the surest way to increase your score over time.

How can you do this?

  • Don’t go over your credit limit.
  • Try to only use 35% or less of your available credit.
  • Never repay late.
  • Don’t apply for too much credit.

Frequently Asked Questions

  • Is a credit score of 750 good?
  • What is a decent credit score to buy a car?
  • The car loans industry is diverse and even with poor credit, you can likely find a loan. However, car loan companies, including financing available at dealerships, like to see a credit score that is at least in the mid-600s. If your score is at least 630, they should not hesitate to give you a loan, as long as your other qualifications are also adequate. When you surpass the Equifax-defined “good” score of 725, you should be viewed as an ideal borrower.

    While credit score ranges are the main indicators of creditworthiness, you need to remember that lenders have many other considerations. After credit score, your debt-to-income ratio is normally the most important.


With a focus on business management and financing, Myles takes a proven approach to financial writing that's structured in a format to engage business owners and individuals struggling with debt and managerial challenges.

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