What Is the Highest Credit Score in Canada?

The average credit score in Canada is around 680, which is considered “good.” But do you know where you fall on Canada’s credit score range or how high your credit score can go?

We’ll walk you through everything you need to know about credit scores, the highest credit scores in the country, and how to achieve a perfect credit score.

Credit score ranges and what they mean

Your credit score is a three-digit number that represents your financial health. In Canada, credit scores range from 300 to 900. That means 900 is the highest credit score you can get.

Here’s a breakdown of credit score ranges in Canada:

Credit score range

Category

Below 560

Poor or bad

560 to 659

Fair

660 to 724

Good

725 to 759

Very good

760 and higher

Excellent

Even though a 900 is the best credit score you can earn, any score that’s a 760 or higher is also considered excellent.

What’s a good credit score in Canada?

A good credit score in Canada is a 660 credit score or higher, according to Equifax. Credit scores between 725 and 759 are considered “very good,” while scores over “760” are considered excellent.

However, lenders have their own parameters for determining if a score is “good” or not. Be sure you always review a bank’s minimum credit score requirements to see if your score stacks up.

How credit scores are calculated

What goes into making up your credit score? There are five main factors credit agencies look at when putting your score together. They include your:

1. Payment history - This looks at whether you pay your bills on time, late, or if you miss payments.

2. Credit utilization rate - This analyzes how much credit you carry compared to your total credit limits. You should aim for a low credit utilization rate.

3. Length of credit history - This looks at the average age of your credit accounts, your oldest account, and your newest. A longer account span is better for your credit score.

4. Public records - This details any bankruptcies, collections, or other derogatory marks on your credit profile.

5. New account inquiries - This reflects how many new accounts you’ve applied for recently. It’s better to have a lower number of recent accounts.

Your payment history will have the biggest impact on your credit score (it’s worth 35% of your score), so that’s the most important factor to get on track. Your credit utilization is next (worth 30% of your credit score). Aim to keep your usage below 30% if you want your credit score to increase.

Benefits of high credit scores

Having a high credit score may earn you bragging rights, but having a high score can unlock other doors and opportunities for your money goals. Here are a few benefits of maintaining a high credit score.

Better chances of getting approved for new credit accounts

Want to get approved for a home loan or a new credit card? A high credit score will be a huge help. Many lenders have minimum credit score requirements you need to meet to get approved for a new credit account. And if you don’t meet them, you’re unlikely to get approved.

More likely to lock in lower interest rates

Even if you get approved for a new credit account with a lower credit score, you’ll probably be given a higher interest rate. While this may not seem like a big deal, on a mortgage, it could add up to tens of thousands in additional interest charges over the lifetime of the loan.

A higher credit score will get you access to lower rates and better loan perks, so you’ll spend less money in interest overall.

Better approval chances for an apartment

Your credit score isn’t only used to approve you for new credit accounts. Many landlords and property management companies use it to approve you for a new apartment or rental house. Even if you have a history of on time rental payments, you might be denied housing if your credit score is too low.

Keeping your credit score higher (in the “good” or “very good” range) can help you stand out from other housing applicants and make you a more desirable tenant.

How to get a perfect credit score in Canada

If having a good or very good credit score isn’t enough for you, here are some tips that can help you work toward a perfect credit score.

1. Always pay your bills on time

You might be tired of hearing this one, but it’s the most important tip you can follow to boost your credit score. Your credit scores are significantly impacted by your payment history, and just one missed payment can decrease your score.

But a strong credit history of on time payments can help grow your credit score even more. To make paying on time even easier, enroll in automatic payments to ensure you always pay your credit card or loan bill on the due date.

2. Keep your credit usage low

If you carry high balances on your credit cards, you’re probably hurting your credit utilization ratio. And if your credit utilization ratio is high, your credit score is likely to suffer.

Your credit utilization rate should remain under 30% to keep your credit score high. This means using 30% of your credit limit or less. So, if you have a credit card with a $5,000 credit line, never carry a balance of $1,500 or more at a time to keep your credit utilization ratio healthy.

3. Pay more than the minimum payment

On-time payments go a long way toward improving your score, but minimum payments may not be enough to dig you out of debt. If you carry a credit card balance, try paying more than the minimum amount due to reduce your interest charges.

Not only will doing this free up more money that you can put towards other goals, like building an emergency fund in a high interest savings account or paying off other debt, but it can also help lower your balances, which will in turn lower your credit utilization rate.

4. Only charge what you can afford to pay off

Overspending isn’t helping your financial goals — and it may also be hurting your credit score. To prevent yourself from accumulating new credit card debt, don’t use your credit cards, including virtual cards, for purchases unless you know you can pay off the balance in full at the end of the month.

To make this a regular habit, you can treat your credit card like a debit card. You’ll simply pay for a purchase with your credit card to build credit, then pay off the charge online right away. Doing this either weekly or after each transaction can help you keep your balances low, while reducing your chances of ending up in credit card debt.

5. Keep credit inquiries to a minimum

Adding a new line of credit or credit card to your credit mix can help boost your credit score. Why? When you add a new credit account to your credit history, it increases your available credit, which helps lower your credit utilization ratio.

But if you apply for too many credit accounts in a short period of time, you risk hurting your credit score. When lenders see you applying for multiple credit accounts in a short period of time, they often see this as a risk. It could look like you’re trying to get access to credit to better afford some of your expenses.

Not only could this lead to lenders denying you for credit accounts you want, but it can also lower your credit score. Too many hard inquiries on your credit report at once can lead to a credit score drop.

If you do have to apply for more than one credit account within the same month, your score might drop temporarily, but it should increase as you establish on time payments for these new accounts.

6. Check in on your credit report and credit score regularly

The best way to monitor your progress as you work toward a higher credit score is to review your credit report and credit score regularly.

Both of Canada’s two main credit bureaus — Equifax and TransUnion — offer free access to your credit report online. You can sign up to view your credit report online at each credit agency’s website. You can check your report as often as you’d like, but it’s only updated by the credit bureau once a month.

When you review your credit report, be on the lookout for errors. If you notice anything that seems incorrect on your report, flag it with the credit bureau via their online dispute system.

Monitoring your credit score is a little trickier. You can access your credit score for free through Equifax, but TransUnion only offers free access for Quebec residents. However, you can also use a credit building tool, like KOHO’s credit builder to gain access to your free credit score.

Keep an eye on our score as you work to improve your credit. Over time, you should see your score increase and get closer to the coveted 900 credit score mark.