How to improve your credit score before applying
How credit scores work in Canada, what lenders look for, and practical steps to improve your score before you apply for a mortgage.
Key takeaways
- Canadian credit scores range from 300 to 900.
- Paying on time and keeping balances low matter most.
- Most insured mortgages need a score of at least 600.
How credit scores work in Canada
Your credit score is a number from 300 to 900 that estimates how likely you are to repay what you borrow. Canada has two main credit bureaus, Equifax and TransUnion, and your score can differ slightly between them.
What lenders look for
- Around 680 and up: generally qualifies for the best rates at most lenders.
- 600 to 679: many lenders still approve you, sometimes with conditions.
- Below 600: mainstream options get harder, but alternative lenders may help, usually at higher rates.
Most insured mortgages (less than 20% down) require at least one borrower with a score of 600 or more.
What affects your score most
- Payment history: paying on time, every time.
- How much of your credit you use: try to keep balances under about 30% of each limit.
- Length of credit history: older accounts help.
- New applications: lots of credit checks in a short time can lower your score.
Steps to improve it
- Check your reports from both bureaus for free, and dispute any errors.
- Set up automatic payments so nothing is ever late.
- Pay down credit card balances, starting with the ones closest to their limit.
- Keep older accounts open, even if you rarely use them.
- Avoid applying for new credit in the months before your mortgage.
Most improvements take a few months to show. If you're planning to buy or renew, start now.
This guide is general information, not financial advice. Rules and products change, and every situation is different. A licensed mortgage broker can tell you what applies to you.