Canadian Credit Score Averages

A good credit score is one of the most valuable tools in the box when it comes to financial management. Although decent income and money in the bank are equally important, the ability to get loans and other credit is essential. Buying a home or vehicle, planning a wedding, and funding an education are just a few purchases adults have to face. And with the exception of the very wealthy, credit is needed to pay for each of these.

In addition to providing purchasing power, credit is important since potential employers and landlords also take a look at it to make approval decisions. These are reasons Canadians should know their credit score and work to keep it as high as possible. What do average Canadian credit scores look like? How do they compare among provinces and with other countries? Continue reading to learn the answers to these questions and more!

Average Credit Score & Influences

In Canada, credit scores range from 300 to 900. According to the credit reporting agency TransUnion, the average score overall is about 650. Scores fluctuate depending on each province, however.

Equifax Canada and TransUnion Canada are the two credit bureaus in the country. The exact formula they use to calculate scores is unknown. But certain distinct factors are considered, which include:

  • Consumer payment history
  • Amount of debt carried each month (under 30% is ideal)
  • How long credit has been in use
  • Credit inquiries on the report
  • Diversity in types of credit accounts

It is widely understood that, in every country, credit scores and income are directly related. In Canada, some territories offer citizens more opportunities for better financial health; other areas are rife with financial hurdles. The primary issues that influence credit scores in a given region are:

When all things are considered, consumers are assigned a three digit credit score. This number can make getting credit easier and cheaper, or result in denials or higher interest rates. While these factors can influence credit, they are not a deciding factor when it comes to creditworthiness. Millions of people have achieved good credit with discipline and hard work wherever they reside. And bankruptcy courts around the world have seen a fair share of the rich and the famous that have fallen from financial grace.

Interpreting a Credit Report

Credit scores are the snapshot of the consumer’s credit file. It is a complete and detailed account of financial history. The report contains identifying information and in-depth payment history on all types of credit accounts held by the consumer. Public information like bankruptcies and court judgments are also included. Lenders thoroughly read credit reports to make informed lending decisions.

Modern consumers can also take a peek behind the curtain and view the exact information that lenders see when they apply for credit. They can also uncover and correct any misinformation in their report. Canadians can get one free Consumer Disclosure (credit report) per year. Both reporting agencies have applications for reports online. They can also be sent by mail. Recently, financial technology companies have offered free credit monitoring and reports to consumers.

Some reporting agencies assign a credit rating to each item on the report. The purpose of the rating is to show how credit is used and if payments are made in a timely manner. A letter is assigned based on the type of credit. Ratings are expressed with numbers 1 to 9. A number one means payments were made within 30 days of the due date. A “9” indicates default or a repayment proposal has been entered into with the lender. 

What the Numbers Mean

Credit in Canada is no different than anywhere else in the world. The higher the credit score, the better access to approval for loan products at great interest rates, among other perks. There’s excellent credit and very poor credit. Most people fall somewhere in between this spectrum. Credit score ranges are:

  • Individuals in this range can pretty much qualify for any type of credit that their income supports.  They are offered prime interest rates and higher credit limits.
  • People with this credit still have good approval chances with decent rates. A few months of lowering debt and good payment history can raise their scores to excellent.
  • Good chance of credit approval but with mediocre interest rates. Some consumers choose to delay applying for credit and work on improving these scores to save money in interest.
  • Low approval rates, unless credit is secured with collateral. High interest rates can be expected.

Credit scores are not written in stone. The good news is that low credit scores can be improved over time. Help is widely available to Canadians who want to get their finances on the right track. On the other hand, good credit can take a turn for the worse if not used properly. Maintaining good credit is just as important as achieving a good score.

United States Credit Scores

The credit score range in America is 300-850 and breaks down as follows:

- Exceptional (800 or more)

- Very good (740-799)

- Good (630-739)

- Fair (580-669)

- Poor (lower than 579)

The average score of Americans in 2018 was 704 according to FICO, the major data analytics company in the country. Again, factors such as location and employment influenced credit scores to some degree.

Building up Credit 

Every financial move made affects the credit score one way or another. Consistently timely payments and discipline with credit will result in a higher score. Late or partial payments and excessive debt will bring down a credit score in the blink of an eye. With so many benefits of having good credit, the only responsible way to go is up. Improving and maintaining good credit can be achieved with these steps:

  • Acknowledge that bad credit can be improved even after bankruptcy or a consumer proposal.
  • Commit to improving credit by practicing sacrifice and discipline regularly.
  • Find and use tools to support financial goals such as secured credit cards and lines of credit.
  • Make saving money a habit, no matter how small the deposit.
  • Pay off as much debt as possible.
  • Get support from credit builder programs.

Without exception, credit scores will go up and down many times over the course of a lifetime. Many unavoidable fluctuations are caused by changes in finances, employment, or lifestyle. But individuals must take affirmative action to ensure that credit is not damaged due to making irresponsible financial decisions. 

It is also advisable to think long and hard before trying to escape debt through bankruptcy. This move can be even more damaging and takes years to recover. Instead of taking drastic measures, consumers should consult a credit counselor who is trained to offer solutions that will improve credit in the long run.

Lastly, credit and finance are personal to the consumer; there should be no desire to compete with other people when it comes to money matters. Every individual has a different set of financial circumstances and should set their own goals. Canadian credit score averages are not meant to place pressure on the consumer, but to provide information on building a solid financial foundation. 

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Sheila Kay

Sheila Kay is an author, ghostwriter and editor residing in the Atlanta, GA area. Among her favorite writing genres are creative nonfiction, self-improvement, and finances. Her first published book, PTSD and the Undefeated Me, is a memoir which has been a stepping stone to her involvement with mental health advocacy for military and civilian men and women. She is currently working on the first fiction novel to be published under her name. For more information or to purchase her books, visit Sheila’s Author Page on