A good credit score starts at 660<\/h2>\n\n\n\n
A credit score is a three-digit number that falls somewhere between 300 and 900. In Canada, scores above 660 are generally considered “good.” The higher your number, the more likely potential lenders will view you as a responsible borrower.<\/p>\n\n\n\n
Credit score ranges<\/h3>\n\n\n\n
Though each credit reporting agency and potential lender will have its own standards as to what credit scores are acceptable, the credit score ranges<\/a> below represent what’s typical:<\/p>\n\n\n\n Ideally, you\u2019d work towards getting the highest score possible<\/a>, but a credit score of at least 660 generally makes you eligible to apply for a variety of loans and credit cards.<\/p>\n\n\n\n In Canada, there are two main credit bureaus \u2014 Equifax and TransUnion<\/a> \u2014 that are responsible for calculating individuals\u2019 credit scores, using models provided by companies like FICO<\/a> and VantageScore. <\/p>\n\n\n\n The bureaus collect data about your financial activity (known as your credit report<\/a>) and then distil that information into a credit score based on key factors. <\/p>\n\n\n\n Credit bureaus because they don\u2019t openly disclose the specific formulas they use in their calculations, and they may use different calculations or weight criteria differently, meaning your Equifax score may look different than your TransUnion score.<\/p>\n\n\n\n Your payment history is the most crucial element, accounting for around 35% of your credit score. Payment history is a record of all your current and recent debts<\/a> (including credit cards, installment loans and lines of credit), and whether you made your payments on time. If not, it shows how late you were, if you missed payments entirely or if an account went to collections. This negative data stays on your payment history record for years, so always making your payments on time and in full is the best way to keep up a good payment history.<\/p>\n\n\n\n Credit utilization<\/a>, which accounts for around 30% of your credit score, measures what percentage of your total available credit you\u2019re using at any given time. So, if the borrowing limits on all your credit cards and lines of credit total $50,000, and you have outstanding balances of $25,000 on that available credit, your credit utilization ratio is 50%. In general, experts recommend you keep your credit utilization ratio under 35%.<\/p>\n\n\n\n Credit history accounts for around 15% of your score. This is the length of time you\u2019ve had your various credit accounts open. The longer your credit history the better, because creditors want to see that you have a history of handling debt responsibly<\/a>.<\/p>\n\n\n\n This category accounts for around 10% of your score. Equifax appears to put more emphasis on information from public records, including whether you have a history of bankruptcy or overdue accounts being sent to collection agencies. TransUnion, on the other hand, appears to more carefully consider the different types of credit you use, looking for a good mix of revolving credit accounts (such as credit cards and lines of credit<\/a>) as well as installment loans (such as student loans or a mortgage).<\/p>\n\n\n\n The number of credit inquires<\/a> you’ve had within a certain period of time accounts for around 10% of your score. When you inquire about a loan or apply for a new credit card, a \u201chard inquiry\u201d (also known as a hard pull) is recorded on your account. Too many hard pulls can be problematic, as they may indicate to potential creditors that you\u2019re experiencing financial difficulty and need access to more funds. \u201cSoft pulls,\u201d such as when you look up your credit score, do not affect your credit score.<\/p>\n\n\n\n You can check your credit score<\/a> by contacting either of the Canadian credit bureaus, Equifax and TransUnion. Equifax provides credit scores for free when requested online or via mail. TransUnion requires a paid subscription to access its credit scores, unless you live in Quebec. Other companies, like Borrowell<\/a> and ClearScore, will allow you to check your Equifax or TransUnion credit scores for free, if you sign up for an account.<\/p>\n<\/div><\/div><\/div>\n\n\n\n The credit score modeling company Fair Issac Corporation (FICO) reported in November 2024 that the average credit score<\/a> in Canada was 760.<\/p>\n<\/div><\/div><\/div>\n\n\n\n Your credit score tells potential lenders whether you\u2019re creditworthy. If you have a high score, you\u2019ll be deemed creditworthy, which is just another way of saying you\u2019re a good credit risk because you\u2019re more likely to make good on your debts.<\/p>\n<\/div><\/div><\/div>\n\n\n\n Your credit score is a crucial consideration for potential creditors; however, it isn\u2019t the only thing that matters. Additional factors include your income, whether you have any collateral (a home or other asset, for example) to secure a loan, how much other debt you\u2019re carrying and if you have stable employment (versus being self-employed or a gig worker).<\/p>\n<\/div><\/div><\/div>\n<\/div><\/div><\/div>\n<\/div><\/div><\/div>\n\n\n\n Sandra MacGregor is a freelance writer who has been covering personal finance, investing and credit cards for over a decade. Her work has appeared in a variety of publications like…<\/p>\n\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\tRead more about Sandra MacGregor and explore their articles<\/span>\n\t\t\t\t\t\t<\/a>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t\t<\/div>\n<\/div>\n\n\n\n\t Want to improve your credit? These strategies will demonstrate your creditworthiness to lenders and may help you build a better credit score. <\/p>\n\t<\/div>\n\n\t Your credit report is a record of your credit history that’s used to calculate your credit score. Get your free credit report by contacting a credit bureau.<\/p>\n\t<\/div>\n\n\t A soft inquiry pulls enough of your credit history to determine your creditworthiness; a hard inquiry is a formal review of your credit report. <\/p>\n\t<\/div>\n\n\t When applying for a credit card, issuers typically consider your age, income and credit score. Check out our guide on how to get a credit card before you start the process. <\/p>\n\t<\/div>\n\n\t The definition of a good credit score depends on the reporting agency, but generally, scores above 660 are considered “good.”<\/p>\n","protected":false},"author":3,"featured_media":622,"parent":104,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"page-templates\/article-sidebar.php","meta":{"_acf_changed":false,"om_disable_all_campaigns":false,"apple_news_api_created_at":"","apple_news_api_id":"","apple_news_api_modified_at":"","apple_news_api_revision":"","apple_news_api_share_url":"","apple_news_coverimage":0,"apple_news_coverimage_caption":"","apple_news_is_hidden":false,"apple_news_is_paid":false,"apple_news_is_preview":false,"apple_news_is_sponsored":false,"apple_news_maturity_rating":"","apple_news_metadata":"\"\"","apple_news_pullquote":"","apple_news_pullquote_position":"middle","apple_news_slug":"","apple_news_sections":"[\"https:\\\/\\\/news-api.apple.com\\\/sections\\\/258a2d7c-962b-47be-93aa-4e3a3f4b4a02\"]","apple_news_suppress_video_url":false,"apple_news_use_image_component":false,"footnotes":"","_nw_pros_cons_block_schema":""},"content-classification":[13],"topic":[267],"cluster":[268],"pp_author":[24],"acf":[],"apple_news_notices":[],"yoast_head":"\n\n
How is a credit score calculated?<\/h2>\n\n\n\n
Payment history<\/h3>\n\n\n\n
Credit utilization<\/h3>\n\n\n\n
Credit history<\/h3>\n\n\n\n
Public records and\/or credit mix<\/h3>\n\n\n\n
Credit inquiries<\/h3>\n\n\n\n
Frequently asked questions about good credit scores<\/h2><\/div>
\n\t\t\tAbout the Author\t\t<\/h4>\n\n\t\t\t\t\t
\n\t\t\t\tDIVE EVEN DEEPER \t\t\t<\/h4>\n\t\t\n\t\t
![\"How](\"https:\/\/www.nerdwallet.com\/ca\/wp-content\/uploads\/sites\/2\/2021\/07\/GettyImages-1192724379-e1625610447213-460x191.jpg\")
\t<\/a>\n\t\t\t\n\t\n\t\tHow to Get a Better Credit Score\t<\/a>\n<\/h4>\n\n\t
![\"\"](\"https:\/\/www.nerdwallet.com\/ca\/wp-content\/uploads\/sites\/2\/2021\/07\/BarryChoi-e1626212860872-40x40.jpg\")
Barry Choi<\/a>![\"\"](\"https:\/\/www.nerdwallet.com\/ca\/wp-content\/uploads\/sites\/2\/2024\/05\/Janine_headshot-150x150.jpeg\")
Janine DeVault<\/a>\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t<\/div>\n\t\t<\/div>\n\t<\/div>\n<\/div>\n<\/div>![\"How](\"https:\/\/www.nerdwallet.com\/ca\/wp-content\/uploads\/sites\/2\/2021\/07\/GettyImages-1214479802-e1625169976763-460x191.jpg\")
\t<\/a>\n\t\t\t\n\t\n\t\tHow to Get a Free Credit Report in Canada\t<\/a>\n<\/h4>\n\n\t
![\"\"](\"https:\/\/www.nerdwallet.com\/ca\/wp-content\/uploads\/sites\/2\/2021\/07\/Sandra-MacGregor-e1626212852416-40x40.jpg\")
Sandra MacGregor<\/a>Janine DeVault<\/a>\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t<\/div>\n\t\t<\/div>\n\t<\/div>\n<\/div>\n<\/div>![\"How](\"https:\/\/www.nerdwallet.com\/ca\/wp-content\/uploads\/sites\/2\/2021\/07\/GettyImages-1225074478-e1625170644505-460x192.jpg\")
\t<\/a>\n\t\t\t\n\t\n\t\tHow Do Credit Inquiries Work?\t<\/a>\n<\/h4>\n\n\t
Barry Choi<\/a>\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t<\/div>\n\t\t<\/div>\n\t<\/div>\n<\/div>\n<\/div>![\"How](\"https:\/\/www.nerdwallet.com\/ca\/wp-content\/uploads\/sites\/2\/2021\/06\/GettyImages-1217031480-e1624921223883-460x191.jpg\")
\t<\/a>\n\t\t\t\n\t\n\t\tHow to Apply for a Credit Card in Canada: A Complete Guide\t<\/a>\n<\/h4>\n\n\t
Barry Choi<\/a>\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t<\/div>\n\t\t<\/div>\n\t<\/div>\n<\/div>\n<\/div>\t\t<\/div>\n\t<\/section>\n\n","protected":false},"excerpt":{"rendered":"