How Credit Scores Work in Canada — Guide for Teens & Students

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How Credit Scores Work in Canada — A Guide for Teens

Your credit score is a number between 300 and 900 that tells lenders how likely you are to repay borrowed money. It follows you through your entire financial life — affecting whether you can get a credit card, a car loan, a mortgage, or even some rental apartments. Understanding it as a teenager gives you a massive head start.

Credit Score Ranges in Canada

Score Range	Rating	What It Means
800–900	Exceptional	Best rates on everything
720–799	Very Good	Easily approved, competitive rates
660–719	Good	Approved for most products
560–659	Fair	Limited options, higher rates
300–559	Poor	Difficulty getting approved

The two major credit bureaus in Canada are Equifax and TransUnion. You have a score at each. Lenders may check one or both when you apply for credit.

What Goes Into Your Credit Score

Factor	Weight	What It Means
Payment history	~35%	Did you pay on time? Most important factor.
Credit utilization	~30%	How much of your credit limit are you using?
Length of credit history	~15%	How long have your accounts been open?
Credit mix	~10%	Variety of credit types (cards, loans, etc.)
New inquiries	~10%	How many new credit applications you've made

How to Start Building Credit as a Teen

You can't have a credit score without having credit. Here's how to get started once you turn 18 (or 19, depending on province):

Get a student credit card — even with a low limit of $500
Use it for one small, recurring expense — like a subscription or phone bill
Pay the full balance every month — on time, without fail
Don't max out the card — keep usage below 30% of your limit
Don't close the account — even if you get another card, keeping old accounts open lengthens your history

Pro tip: KOHO offers an optional Credit Building feature (on paid plans) that reports to Equifax monthly. This is one of the few ways to build credit without a traditional credit card.

Things That Hurt Your Credit Score

Missing a payment — even by a few days
Maxing out your credit card
Applying for multiple credit products in a short period
Having an account sent to collections
Co-signing a loan for someone who then misses payments

Important: Negative marks (like a missed payment) stay on your credit report for 6 years. Positive history also stays — so every on-time payment builds your reputation over time.

How to Check Your Credit Score for Free

Borrowell — Free Equifax score, updated weekly
Credit Karma — Free TransUnion score
Mogo — Free Equifax score
Your bank's app — Many Canadian banks now show your score in the app

Checking your own score is a "soft inquiry" and does not affect your score. Only applications for new credit (hard inquiries) affect it.

FAQs

Do teens have a credit score in Canada?

Only if you've had credit in your name. Most teens under 18 have no credit history. You begin building a score once you open a credit card or loan in your own name after age of majority.

What's a good credit score for a 20-year-old in Canada?

Anything above 660 is solid for someone who just started building credit. At 20, having a score of 680–720 means you've been managing credit well for a couple of years.