Credit scores in Canada start from 300 and go to 900.
What it tells the lender or landlord is what the borrower or tenant will be like in terms of risk and paying their rent on time. If you’re looking to buy a property or rent a property, you’d want to have good scores. It can save you money as a borrower.
Depending on the job, employers will also look at credit scores and see what kind of employee you’d be like. So having a low score could prevent you from getting a rate at all or that apartment/house to rent or that job.
It’s important to note that the credit score is a snapshot of a specific time. It can go up or down. To get and keep good credit scores, here are some tips to do:
1. Pay your bill on time. Don’t let it go past due. If you must, set up auto payments.
2. Don’t let it go to collections. If it does, pay all of it and call Equifax and let them know it was paid in full.
3. Have a credit history. Apply for a credit card and make sure that what you buy, you’ll pay back before the due date.
4. If you’re at a store and they ask you to apply for a card to save “x” percent, don’t do it. Be selective. What you think you can save on the percent isn’t going to be worth it if you don’t pay back in full on the due date because of the high interest you’d have to pay on that card.
5. If you’re thinking of buying a condo/house, be mindful of putting any big purchases on your credit cards. A big purchase on your card could hurt your score. If possible, make the big purchases after the property closes.
In general, having a credit score that is above 660 will allow you to get the standard loan. A lesser score could be more challenging. A credit score of 720 to 779 is very good. A score of 780 and above is excellent.
