What is my credit score – and why is it important?

Your credit score isn’t just a number that helps lenders determine how risky of a borrower you are, it can also affect rental housing applications, interest rates and even your ability to get a cell phone contract.

In this guide, we show you where you can find your credit score and what goes into calculating it.

Get your credit score

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Name	Product	Starting Price	Price Per Month	Credit Scores	Credit Monitoring	Credit Reports	Update Frequency
MyMarble MyMarble		$0	$0 - $29.99	TransUnion	Yes	TransUnion	Monthly	MyMarble’s AI technology gives you real-time recommendations to improve your finances. Get actionable steps to improve your finances by paying down your debt faster, adjust your budget and build your credit score. See results in just 30-45 days.	Go to site More Info		loading Fetching your data...
Mogo Credit Score Mogo Credit Score		$0	$0	Equifax	Yes	Equifax	Monthly	Open a MogoAccount and access your credit score for free with no impact to your score. Receive your updated Equifax credit score every month.	Go to site More Info		loading Fetching your data...
OFFER Credit Verify Credit Verify	OFFER	$1 for 7 day trial	$34.95	TransUnion	Yes	TransUnion	Monthly	Instantly access your credit score and report online and get daily alerts and updates. Plus, premium members get $25 in bonus rewards every month which can be used towards discounts on everything from shopping and entertainment to dining and travel.	Go to site More Info		loading Fetching your data...

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What is a credit score?

A credit score is a summary of your credit history expressed as a number ranging from 300 to 900. The credit score model is a risk-based system that calculates the possibility of you defaulting on your next loan – the lower your score. The higher your credit score is, the better position you’re in to get approval for financial products with competitive terms.

A few different factors go into creating your credit score, and both of the two main credit bureaus in Canada (Equifax and TransUnion) use different criteria for measuring your score, weighing your financial history against their own algorithm. This results in two slightly different credit scores.

Whenever you make an application for credit (e.g. a mortgage, credit card or personal loan), the lender will turn to the credit bureaus to look at your score and history, which will play a major role in the success or failure of your application, as well as the rates and terms you’re offered. By looking at your credit report in conjunction with its own assessment of your circumstances, the lender will decide the following:

What are the credit score tiers and ranges?

While not set in stone, the general credit tiers are as follows:

Where can I get a copy of my credit score?

There are a few different ways to get a copy of your credit score – some are free and some cost a small fee.

• Credit score services. There are many free credit score services that require basic personal information to access your credit report. You can find many reputable companies online offering this service, including any in the table above.
• A credit bureau. You can find out your credit score directly from one of the two major credit bureaus: TransUnion or Equifax. You may have to pay a fee to access your score immediately, while ordering a copy via the mail will usually be free of charge.
• Credit counsellors. If you’re in need of financial counselling, credit counsellors can provide you with a copy of your credit report and credit score free of charge.
• Via financial products. Some banks and online lenders will offer credit-building products such as secured credit cards and loans that allow you to access your credit score in order to work on increasing it.

Do you only have one credit score?

You will likely have a slightly different credit score with TransUnion than you do with Equifax. While both credit bureaus are equally important and reputable, one may calculate your score slightly differently from the other, depending on their algorithms. A bureau may weigh specific factors differently than the other bureau, which results in a slightly different credit score.

When you apply for a credit product – whether that’s a mortgage, credit card, loan or line of credit – a lender may check your credit score with either both bureaus or they may check with only one credit bureau. Additionally, lenders may only report your payment information to one bureau, or they may report to both.

One important detail to note is that you’ll always have the same credit file. If there are no errors listed on your file, you shouldn’t expect too big of a discrepancy between your scores.

What makes up your credit score?

Here are the five main factors that make up your credit score:

• Payment history. Your payment history demonstrates how you have repaid the credit that you’ve borrowed – whether that’s on time and in full, late, in partial payments, etc. Lenders will also report the number and type of credit accounts that you have. Having a variety of different types of credit accounts can be helpful – such as credit cards, loans, mortgages, etc. Your payment history makes up around 35% of your credit score.
• Credit utilization ratio. This is the amount of credit you’re using compared to the total amount of credit available to you. Running your balances up to your credit limit, or even over 40% of your available credit limit, can negatively affect your score. Try to keep your credit utilization ratio around 30% or less. Your credit utilization ratio makes up around 30% of your credit score.
• Credit history. This is the length of time that you’ve had your accounts open for, and can affect your credit score for better or for worse. The longer you have accounts open, such as credit cards or lines of credit, the more positively your credit score will be impacted. Your credit history makes up around 15% of your credit score.
• Public records. Declaring bankruptcy or having a collections agency come after you will damage your score. Public records make up around 10% of your credit score.
• Recent inquiries. Applying for new credit means a lender will likely conduct a hard pull on your credit report to determine whether or not you’re a good candidate for borrowing money. But doing a hard pull means your credit score will take a temporary dip. A few recent inquiries on your credit report can raise red flags with lenders since it looks like you’re trying desperately to access a lot of credit at one time. Inquiries make up around 10% of your credit score.

Those three digits can have a big impact on your life – for better or worse – so they’re worth keeping an eye on. Be aware of the factors that influence your score and monitor your credit score carefully – you may just help edge it closer to the 900 mark with a little effort and dedication.

Common mistakes that hurt your credit score

You probably already know that making late payments or defaulting on a loan is guaranteed to lower your credit score. However, here are some lesser known ways that you can hurt your credit score:

• Applying for multiple credit products at one time. Submitting applications for credit cards or loans requires a lender to do a “hard pull” on your credit score, which can have a negative affect on your credit score – especially if you submit multiple applications in a short period of time.
• Letting your credit card balance get too high. Since your credit card balance directly affects your credit utilization ratio, spending close to your credit limit will increase your ratio. Having a ratio higher than 30% will result in a lower credit score.
• Closing credit accounts. When you close a credit account, the amount of credit available to you goes down – causing your credit utilization ratio to increase. Additionally, closing an old credit account can make your credit history seem shorter than it actually is, lowering your credit score again.
• Renting a car with anything but a credit card. Car rental companies sometimes run a credit check on customers who don’t want to pay with a credit card.
• Not paying parking tickets or other important bills. Those bills don’t just pay themselves. After a while, parking tickets and other bills get sent to collection agencies, which negatively impacts your credit score.
• Signing up for a new phone contract. Phone companies do a hard credit check when you sign up, causing your credit score to take a temporary dip.

Repair your credit

Sort by:

Name	Product	Price Per Month	Credit Scores	Credit Monitoring	Credit Reports	Update Frequency
MyMarble		$0 - $29.99	TransUnion	Yes	TransUnion	Monthly	MyMarble’s AI technology gives you real-time recommendations to improve your finances. Get actionable steps to improve your finances by paying down your debt faster, adjust your budget and build your credit score. See results in just 30-45 days.	Go to site More Info		loading Fetching your data...
Credit Building by KOHO		$10	Equifax	Yes	Equifax	Monthly	Open either a secured or unsecured line of credit to build or rebuild your credit history. No hard credit check required. Subscription length is 6 months and can be cancelled at any time.	Go to site More Info		loading Fetching your data...

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Frequently asked questions

• Do married couples have a joint credit score?

  No. Each individual has a personal credit score. However, if you combine your finances with your partner, your spouses’ credit habits may affect your creditworthiness. This would only be the case if you share the same credit cards, loans, mortgages or lines of credit and you or your spouse fail to make payments on time, etc.

• How long will negative information stay on my report?

  It usually takes six to seven years for negative information to leave your credit report, depending on what the negative information is and which bureau you get your report from. TransUnion typically keep information on hand for a maximum of seven years, while Equifax keep it for a maximum of six. Bankruptcy stays on your report the longest, while inquiries tend to be on your report for the shortest amount of time.

• How often does my credit score change?

  Every time your credit report changes, your credit score changes. New information is added with every payment (or missed payment), so it’s usually consistently changing slightly. From month to month, you’ll likely notice a difference in your credit score.