How Credit Scores Are Calculated in Canada (2026)

Your credit score is one number that quietly decides whether you qualify for a mortgage in 2026 — and at what rate. Yet most Canadians have never been shown how that number is actually built. This guide breaks down the 300-900 scale, the five factors the bureaus weigh, and exactly how each one moves, so you can read your own report like a lender does.

The short answer

In Canada, credit scores run from 300 to 900 and are calculated from five factors: payment history (~35%), credit utilization (~30%), length of credit history (~15%), credit mix (~10%), and new credit/inquiries (~10%). Equifax and TransUnion each maintain their own version, so your two scores will differ. Most prime mortgage lenders want to see roughly 680 or higher.

The 300-900 range: what counts as "good"

Both Canadian credit bureaus express your score on a 300-900 scale, where higher is better. The number is a snapshot prediction of how likely you are to repay borrowed money over the next several months. It is not fixed — it recalculates every time new information lands on your file.

Lenders rarely care about the exact digit; they care about the band you fall into. As a working guide, here is how the ranges are commonly interpreted in 2026:

These bands are guidelines, not hard cut-offs. A lender weighs your score alongside income, down payment, and the rest of your application. A 660 with a 25% down payment and stable income can look stronger than a 700 with thin income documentation.

The five factors and their approximate weights

The scoring models used in Canada combine the same five categories. The weights below are the widely cited approximations — bureaus do not publish exact figures, and the real impact shifts based on what else is on your file — but they are accurate enough to prioritise your effort.

Payment history (~35%)

This is the single largest factor, and it is the one lenders scrutinise most. Every account that reports to the bureaus records whether each payment arrived on time. A payment is generally only reported late once it is 30+ days past due, but once it lands, it can sit on your file for years. Recent misses hurt far more than old ones, and the dollar amount matters less than the fact that a payment was missed at all.

Credit utilization (~30%)

Utilization is the percentage of your revolving credit (credit cards and lines of credit) that you are currently using. The lower, the better — and this is the factor you can move fastest, because it resets every statement cycle. Keeping balances under about 30% of each limit is the standard advice; under 10% in the month before a mortgage application is ideal.

Length of credit history (~15%)

This counts the age of your oldest account, your newest account, and the average age across all of them. It rewards patience, which is why closing your oldest card can backfire — it can shorten your average history and remove available credit at the same time.

Credit mix (~10%)

Scoring models like to see that you can handle different types of credit: revolving accounts (cards, lines of credit) and installment accounts (car loans, RRSP loans). You should never open an account purely to chase mix, but a borrower with only a single credit card has less to show than one managing a card plus a small loan responsibly.

New credit and inquiries (~10%)

Each time a lender pulls your file to assess an application, it records a hard inquiry. A flurry of applications in a short window can signal risk and shave a few points temporarily. Soft inquiries — such as checking your own score — never affect it. If you are rate-shopping, multiple mortgage inquiries inside a short window are usually treated as a single event; more on that in our guide to whether mortgage shopping hurts your score.

Worked example: how utilization math works

Utilization confuses people because it is calculated both per-card and overall. Suppose you hold two cards:

• Card A: $2,000 limit, $1,500 balance — that is 75% utilization on this card.
• Card B: $8,000 limit, $500 balance — that is about 6% on this card.

Your overall utilization is the total balance divided by the total limit: $2,000 owed against $10,000 available, or 20%. That overall figure looks healthy, yet Card A's 75% can still drag your score because the model also looks at individual-card utilization. The fix is targeted: pay Card A down to roughly $600 (30% of its $2,000 limit) and your worst-card figure falls in line with the rest. Spreading the same total balance across both cards — or paying before the statement date so a lower number reports — can lift your score within a single cycle, with no new borrowing required.

Equifax vs TransUnion: why your scores differ

Canada has two national credit bureaus, Equifax and TransUnion. They are competitors, and lenders do not all report to both — or report at the same time. That is why the same person routinely sees two different scores in the same week.

• Different data: a lender might report your loan to one bureau and not the other, so each file can hold different accounts.
• Different timing: updates can land days apart, so a balance you just paid may show on one report and not yet the other.
• Different models: each bureau uses its own scoring formula, so identical data can still produce slightly different numbers.

Neither score is the "real" one. A lender simply pulls whichever bureau (or both) it relies on. For a deeper comparison, see Equifax vs TransUnion. The practical takeaway: check both, because an error or stale balance on one can quietly cost you.

What score mortgage lenders want

There is no single national cut-off, but the tiers are consistent in 2026:

• Prime lenders (banks, monolines): generally look for about 680+. Strong applications occasionally pass slightly lower with compensating factors.
• Alternative (B) lenders: commonly work in the 500s-600s, pricing for the added risk.
• Private lenders: focus on equity and the property rather than the score itself.

If you are close to a threshold, small moves — paying down a maxed card, correcting a reporting error — can tip you into a better tier. Our guide to the credit score you need for a mortgage covers the tiers in detail, and if your score is currently low, bad-credit mortgage options can finance you while you rebuild.

How to improve each factor

1. Payment history: set autopay for at least the minimum on every account so nothing slips to 30 days late.
2. Utilization: pay balances down before the statement date and keep each card under ~30%.
3. Length of history: keep your oldest accounts open and active, even if you barely use them.
4. Credit mix: if you only hold cards, a small, well-managed installment loan can help over time.
5. New credit: avoid new applications in the months before you apply for a mortgage.

For a full plan, see how to improve your credit score.

Common credit-score myths

• "Checking my own score hurts it." False — that is a soft inquiry and never affects your score.
• "Carrying a balance helps my score." False — paying in full is best; you do not need to carry interest to build credit.
• "Closing old cards helps." Usually the opposite — it can shorten your history and raise utilization.
• "My income is part of my score." No — income is not a scoring factor, though lenders consider it separately.
• "I only have one score." No — you have at least two (Equifax and TransUnion), and they will differ.

Frequently asked questions

What is a good credit score in Canada?

On the 300-900 scale, roughly 680+ is considered good and meets most prime mortgage lenders' threshold. Above 720 is very good, and 800+ is excellent and earns the widest lender choice.

Why are my Equifax and TransUnion scores different?

The two bureaus hold different data, update at different times, and use different scoring models. Lenders do not all report to both, so each file can contain different accounts — producing two different numbers from the same person.

Which factor affects my credit score the most?

Payment history, at roughly 35%, carries the most weight, followed closely by credit utilization at about 30%. Together they account for the majority of your score, so on-time payments and low balances matter most.

Does checking my own credit score lower it?

No. Checking your own score is a soft inquiry and has no effect. Only hard inquiries — when a lender pulls your file for an application — can temporarily reduce your score, and only slightly.

How quickly can I raise my credit score?

Utilization changes can show up within one statement cycle, so paying down a maxed card can lift your score in weeks. Rebuilding after missed payments or a credit event takes longer — typically 12-24 months of clean history.

Want to know where your score stands and what it means for your mortgage? Ask Maya for a quick, judgment-free read, or talk to an advisor who can tell you exactly what to fix before you apply.