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Credit Scoring in Canada

If you are trying to manage your personal finances, it is important to know what goes into your credit report, who submits and gathers the information, and how your credit score is formulated.

Your credit report is a snapshot of your credit history as reflected by the financial information gathered from the two major credit bureaus, Equifax Canada and TransUnion Canada. Taking out a loan is a big investment, and knowing how financial institutions grade your credit report could make the difference in securing that next loan.

Requesting Your Credit Report

You can request a free copy of your credit report once a year from the two major credit bureaus in Canada. Your free copy will be delivered by mail and will not contain your credit score. Alternatively, you can request a copy online and get an instant report with the option to include your credit score, but it will cost you.

Understanding Your Credit Score

Credit scores range from 300-900; the higher the number, the better the score. The health of your score depends on a number of factors.

Information that makes up your credit score:

  • Credit card payments
  • Telecommunications accounts (mobile phone and internet bills)
  • Liens and repossessions
  • Bankruptcy
  • Delinquent accounts
  • Debts sent to collections
  • Negative banking information
  • Inquiries from lenders and others who request your credit report

Credit Rating

Similar to a credit score, a credit rating splits your credit up into three types and measures your risk for revolving credit on a scale from one to nine:


I - Installment

Refers to a loan that has a fixed price and timeline that runs until the debt is paid. (Ex. Car loan).

O - Open

Open credit is when you borrow money up to a certain max limit and the full balance is due at the end of each period. (Ex. Student loans).

R - Revolving

The most common line of credit, this is when you make regular payments in varying amounts depending on the balance of your account, and can then borrow more money up to your credit limit. (Ex. Credit cards).


R0 - Too new to rate; approved but not used.

R1 - Pays within 30 days of payment due date or not over one payment past due.

R2 - Pays in more than 30 days from payment due date, but not more than 60 days.

R3 - Pays in more than 60 days from payment due date, but not more than 90 days.

R4 - Pays in more than 90 days from payment due date, but not more than 120 days

R5 - Account is at least 120 days overdue, but is not yet rated "9".

R6 - This rating does not exist.

R7 - Making regular payments through a special arrangement to settle a debt.

R8 - Repossession (voluntary or involuntary return of merchandise).

R9 - Bad debt; placed for collection; moved without giving a new address, or bankruptcy.

Managing Your Finances

Having a clear understanding of your credit report, rating, and score can help you better manage your finances and determine your ability to take on an auto loan. If you are in the market for a new or used car, truck or SUV, Canada Auto Finance is here to help. Fill out our simple online finance application and get the process started.

  • Get Approved + Pick a Car
  • Approvals for Good Credit, Bad Credit + No Credit
  • Up to $45,000 car loan