How and Where To Check Your Credit Score in Canada
Ah, the dreaded credit score conversation. Given its importance on the Canadian financial scene, it can be a scary topic to approach—how can our entire financial history be deduced to just one number?
Intimidating as it may be, it’s important to take ownership of your credit score in order to protect your identity and plan for big purchases. In this article, we’ll explain the role these infamous three digits play in your financial life as well as how you can check your credit score in Canada.
Table of Contents
What is a Credit Score?
A credit score is an three-digit number assigned to you by a credit bureau that reflects your “creditworthiness”, or how likely you are to repay debt. It is calculated using an array of factors including the amount of time that you’ve been borrowing, the types of debt that you have, and your credit utilization rate (i.e., the amount of debt that you owe versus the amount of debt that you could potentially owe).There are two reporting credit bureaus in Canada: Equifax and TransUnion.
The way that they calculate their scores are similar, but they do assign a different weight to each factor, which could result in differing scores. Some Canadians prefer to track both their Equifax and TransUnion score to maintain a well-balanced image of their economic situation.
Although “credit score” and “credit report” are often used interchangeably, it’s important to note that they’re not the same thing. While your credit score is a number that represents your lendability, your credit report is a complete overview of your financial (i.e. credit) history that includes specific information about your loans and other accounts as well as your payment history. This includes any amount owed on a loan, whether it’s revolving credit (like a credit card) or non-revolving credit (like a student loan).
Why should you check your Credit Score?
As mentioned above, your credit score is often a significant factor in a lender’s decision-making process. Some of parties that will perform credit checks on you include landlords, car dealerships, cell phone carriers, and creditors of any kind. But did you know that the most important person who should be checking your credit score is yourself?
Not only does keeping track of your credit score help ensure that you haven’t been the recent victim of identity theft, but it also helps paint an accurate picture of your financial situation. This serves as a foundation for all of your money decisions.
If you credit rating isn’t where you want it to be, then being aware of your credit score is the first step to improving it. While many factors go into calculating a credit score, knowing yours will help inform where your financial efforts should be going—i.e., whether you should be focused on decreasing your utilization rate, opening new accounts, or paying down debt. Which brings us to our next point.
Paid vs. Free Credit Scores
It used to be that, to check your Canadian credit score, you’d have to send it away in the mail for a physical copy from one of the credit bureaus. Fortunately, we’re no longer living in the stone age—there are several tools that you can use to check your score for free. More on that in just a bit. First, a caveat.
Free credit reports should be sufficient to serve the needs of most people. However, it’s important to note that some free credit score monitoring tools may make money by selling your personal information to advertisers, or by recommending products to you and then taking a cut. If you’re not comfortable with this arrangement, you can opt to pay for your credit score directly from the bureaus. You are entitled to check your credit score for free once a year, but you’ll have to pay if you want to see it on demand.
Important note: as of 2021, Quebec has passed utilization requiring the credit bureaus to provide consumers with free credit checks. At the time of writing, Equifax is honouring this agreement for free access to all Canadians, but free online TransUnion credit reports are only available to residents of Quebec.
What is a good Credit Score?
Credit scores exist from 300 to 900, with 300 being the lowest and 900 being the highest. You don’t need to score a perfect 900 to have a good credit score, though (and in fact this number is pretty much impossible to obtain). A good credit score is generally considered anything above 660, with a score above 725 being considered very good and, above 760 considered excellent.
To paint a broader picture, here is an overview of the five categories of credit scores:
- Very poor: 300-559
- Poor: 560-659
- Average: 660-724
- Good: 725-759
- Excellent: 760+
How to check your Credit Score for free?
Here are the many apps and services you can use to check credit scores in Canada:
Borrowell was the first third-party company in Canada to offer free credit reports. They pull their report from Equifax and refresh it automatically for their customers on a weekly basis. Borrowell’s other offerings include an AI-empowered credit coach who makes recommendations for ways that customers can improve their score. All Borrowell customers also get access to personalized recommendations based on their credit profile.
While no stranger to the United States, CreditKarma is a newcomer on the Canadian scene. It offers Canadians free access to their TransUnion credit score, a rarity in the country. While its offerings are pretty scant at the moment, there is a chance that they could expand in the near future.
Mogo is a Vancouver-based fintech company that offers free credit score monitoring as part of their prepaid Visa card (the MogoCard). Like Borrowell, they pull their score from Equifax.
Some banks, such as RBC, will allow you to see your credit score in real-time through your online banking platform. This is a convenient option for money-savvy Canadians who like to keep only a skeleton crew of apps on their phone.
Directly From the Credit Bureau
As we said earlier, in some cases you can get your credit score for free directly from the credit bureau. By law, every resident of Quebec is entitled to free access to their credit score. The rest of Canada has limited access to their credit scores directly through Equifax or TransUnion—for credit monitoring, you’ll have to pay.
How to get a paid Credit Score
If you would like to see your credit score instantly and directly from the bureau, you’ll have to pay in certain cases. You can either check your credit score online, in the mail, over the telephone, or in-person. You are not required to share your Social Insurance Number (SIN) but in some cases it may help with accuracy and can help you get your credit score faster.
How often are Credit Scores updated?
Your credit score is updated whenever lenders report information to the credit bureaus. Generally, this is about once a month, but it can happen more frequently than this, which is why some monitoring services offer weekly updates.
Will credit checks affect my Credit Score?
This depends on whether it’s a hard check or soft check. Checking your own credit score using one of the apps listed above or through Equifax and TransUnion is generally considered a soft check and therefore will not affect your credit. However, if you make a major credit application such as for a loan or major purchase like a credit card, a line of credit, a home or a vehicle, generally will affect your score, at least for a short period of time thereafter.
The reason for this? Performing too many hard credit checks in a short timeframe may send the lenders the message that you’re short on cash or planning to dig yourself into some serious debt and, as a result, may negatively affect your credit score.
The Bottom Line
Nobody likes to be thought of as just a number but the fact is that your credit card is an important part of life and can be an indicator of how far you have to go in reaching your financial goals. It’s a good idea to regularly monitor your credit score so you can make sure your bills are settled and you’re safe from identity theft, but if you aren’t where you want to be, don’t worry. There’s a lot of ways you can get those three digits to work with you—downloading one of the free apps mentioned above is a great place to start.
Frequently Asked Questions
There are several good ways to check your credit score in Canada. For residents of Quebec, it’s free to check your score directly with one of the two credit bureaus (TransUnion or Equifax) at any time. For everyone else, you have access to a limited number of free checks through the bureaus. However, you always have the choice of paying for an instant check through the credit bureaus themselves or relying on a free app like Borrowell or CreditKarma.
Yes. Contrary to popular belief, there is no limit to the number of times that you can check your credit score. Although hard inquiries on your credit report have the potential to lower your score, checking your personal credit score is considered a soft inquiry and as a result will not have any effect on your score. Most credit bureaus get account updates from lenders on at least a monthly basis, so it might be worth your while to get credit score updates as frequently as every week.
Although credit score and credit report are often used interchangeably, they are not the same thing. While “credit score” refers to three digits that represent the risk you hold as a borrower, a “credit report” paints a more thorough picture of your financial life with a breakdown of all of your money-spending history. It contains a breakdown of your payment history, as well as all of your personal information like your address, previous address, employers, previous employers, telephone number, and so on.