Credit Scores in Canada: How to Build Credit as an Immigrant

Moving abroad and starting a new life is an exciting feat for many people. However, this journey comes with its own set of challenges. One of these challenges is building a good credit score as an immigrant.

Credit scores, unlike many other goods, cannot be transported into another country (like Canada). This makes purchasing and financing a home seem impossible. At the same time, renting can be difficult because many landlords examine credit scores.

Read on to discover more about credit scores in Canada and how to build your credit score as an immigrant.

Understanding Credit Scores in Canada

Some countries have credit evaluation systems comparable to Canada’s, while others have vastly different systems. The minimum credit score is 300, and the highest credit score is 900. The majority of Canadians desire creditworthiness, as this shows the dependability of your creditor repayment.

Equifax and Transunion are Canada’s two biggest credit bureaus. Credit bureaus consider a variety of variables when calculating your credit score. These are the components, such as credit deterioration, credit line duration, credit balance, repayment behaviour, debts, bankruptcy, and more.

Credit Scores in Canada: Credit Score Analysis

There are five credit score divisions in Canada:

  • Poor: 300-559
  • Fair: 560-659
  • Good: 660-724
  • Very Good: 725-759
  • Excellent: 760-900

An excellent credit score is recommended for higher loan and credit card limits as well as lower interest rates. As previously mentioned, your credit score is influenced by a variety of factors. In varying percentages, your credit score may be determined after examining your payment history, credit utilization, credit history, inquiries, and public records.

If you fall short in one of these areas, you can make up for it in another. Because of these changes, your credit score varies monthly. Consistency will enable it to maintain its high standard.

5 Things You Can Do to accomplish Better Credit in Canada

It is feasible to establish credit without having a credit score. It requires time to build credit. Positive acts will have a huge impact. As previously stated, your payment history has the largest influence on your credit score, so paying on time is beneficial.

1. Secure a Phone Plan

Even if it appears insignificant, signing up for a phone plan and paying your payment on time can help your credit score. The strategy must be repeated on a regular basis and cannot be permanent. Prepaid plans are not reported to credit agencies.

2. Apply for a Credit Card

Credit cards assist in the establishment of credit. However, incorrect credit card usage can have a negative effect on one’s credit score. Use no more than 35% of your available cash and make on-time payments.

If you are unable to obtain a credit card, you should consider getting a secured credit card. It has the same impact on your credit history as a conventional credit card, with the exception of the security deposit. Payment amounts are determined by credit card firms and their limits.

3. Take Out a Credit-Building Loan

Credit-building loans show your consistent payment history on your credit report. Lenders think you will pay on time. Credit-building loans typically have one-year periods.

4. Consider Auto Loans

Automobile loans are the most widely available. Because vehicle loans are secured by collateral, creditors are more likely to accept them. If you cease paying, they have the right to repossess the vehicle. If you have bad credit, you may be forced to take a loan with a high-interest rate.

5. Report Good Rent Payment

Rent payment reporting to credit bureaus aids new Canadians in building credit. It may be expensive, and late or delayed rent payments can harm your credit report.


Indeed, it is difficult to start over, especially in another country. Thankfully, with these tips, you can secure a good credit rating and be able to fund your essentials for your new life as an immigrant in Canada.

Are you in need of bad credit loans in Canada? 365 Loans is here to help you secure a loan to cover your essential expenses, whether you are starting out or rebuilding your credit score. Contact us today to learn more about our services!

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