Welcome to Canada! As you settle into your new home, one of the first financial steps you may want to take is to start building a credit history.
Think of your credit score as a way for Canadian lenders, landlords, and service providers to get an idea of what your creditworthiness may be. For them, it’s a snapshot of how you’ve managed credit over time.
Learn more about TD New to Canada Banking Package
Building a healthy credit score early may make everyday milestones feel more accessible. For instance, a good credit score may be helpful when you:
- Are looking to rent an apartment and show that you could be a trustworthy tenant
- Decide to apply for a loan with terms that may suit your needs
- Start exploring mortgage options as you consider buying a home
By learning how credit scores work in Canada and taking small, consistent steps, you can set yourself up for smoother financial experiences as you build your life here.
What Is a Credit Score?
Your credit score is a three-digit number typically between 300 to 900 that shows how you manage credit and how much risk lending to you may involve. Your score can be improved by paying bills on time and keeping your credit balances low, and you may lose points if you miss payments or carry high balances.[1]
How Your Credit Score Is Calculated
Your credit score shows how you have handled credit in the past. Every time you open a new account, make a payment, or miss one, you add to your credit history.
When you apply for credit in Canada, lenders may look at three things:
- Your record with them: They review how you managed any loans or credit cards you already have.
- Details in your application: Any updates you share, such as changes to your income or employment, may also be considered.
- Your credit bureau report: Most lenders consult a third-party credit agency (such as EquifaxⓇ or TransUnionⓇ) for a broader view of your credit activity across multiple providers.
To calculate your score, credit bureaus first collect data from banks, credit card companies, and other lenders. They combine this information into your credit report, which lists your on-time payments, late payments, balances owed, and how much credit you’ve used. All of these factors help to determine your score.[2]
Ready to bank? Learn more about TD New to Canada Banking Package today
Checking Your Credit Report
You may want to check your credit report on a regular basis. Reviewing your report helps you understand where your score stands. It also lets you spot any mistakes. Correcting errors early can protect your rating. A clear record may make it easier to borrow later. On the other hand, overdue or missed payments on your report may make it harder to get credit.
Be aware that credit scores from other countries are usually not used in Canada, where two agencies, EquifaxⓇ and TransUnionⓇ, collect and report your credit information.
How Credit Scores are Rated in Canada
Credit scores in Canada range from 300 to 900. In general terms:
- A score between 660 and 724 may be viewed as good.
- A score between 725 and 759 may be seen as very good.
- A score of 760 or higher can be considered excellent.
Lenders often look at your score when evaluating loan or credit card applications, and landlords or some employers may review it as well. Keep in mind that your credit score can shift over time based on how you manage payments, balances, and overall debt.[3]
What Information are these Companies Collecting to Determine my Credit Score?
To calculate your credit score, credit rating agencies are focusing on the following key factors:
- Your history of on-time payments and how reliably you’ve paid back what you’ve borrowed. Opening a new credit card counts as taking on debt, so timely repayments matter.
- How long you’ve had credit accounts. While you can’t speed up time, starting early on your credit journey as soon as you arrive in Canada may be beneficial.
- How much of your credit limit you’re using. Keeping your balances low compared to your limit may help.[2]
- The number of recent credit applications or inquiries. Applying for many loans or credit cards in a short period may signal risk and could lower your score.[4]
Learn more about TD New to Canada Banking Package
Four Ways to Start Building Your Credit Score
As you settle into Canada, there are a few simple steps you may take to begin establishing your credit history:
- Sign Up for a Phone or Internet Plan
Some providers may require a credit check before they can offer you a service plan. Once you are signed up, and if your service provider reports to the credit bureau, paying your bills on time may boost your credit record. Ask each company whether they share payment data with credit bureaus. - Take on Other Loans Responsibly
Payments on a car lease, student loan, or mortgage also contribute to your credit history. Keeping up with these payments shows lenders you can manage larger debts. - Keep Track of Your Spending
Timely payments depend on staying on top of bills. Using budgeting tools, like TD mobile app or EasyWeb online banking, may help you plan ahead and avoid missed due dates. - Open a Credit Card
Consider applying for a card designed for newcomers, such as the one offered in TD New to Canada Banking Package. Once approved, consider using your card for everyday purchases, and make each payment by the due date. The sooner you open your first card, the sooner your repayment history begins.
Building your credit takes time, but every on-time payment and smart borrowing choice you make may move you closer to your goals. By checking your report, using credit wisely, and leveraging newcomer tools, you can lay down a strong financial foundation in Canada. Good luck as you continue this journey!
Why Choose TD?
150 years helping Canadians:
TD has a proud history of delivering financial solutions to Canadians for more than 150 years.
TD also brings a century of experience helping newcomers navigate the unique challenges of the Canadian banking system.
With over a thousand branches, and the ability to also serve you in more than 80 different languages, TD has become one of the largest and most trusted banks in Canada, now serving 16 million Canadians.
TD offers online support and resources of interest to newcomers on topics such as banking basics, moving to Canada, credit score essentials, and more. TD is open longer hours for your convenience and has thousands of ATMs across Canada to help you take care of your everyday banking needs quickly and easily.
Ready to Bank?
Learn more about TD New to Canada Banking Package today.
Book an appointment to talk with a TD Personal Banking Associate about the TD New to Canada Banking Package. You can book online right away, or visit the TD website to learn more.
Legal Disclaimer:
Information provided by TD Bank Group and other sources in this article is believed to be accurate and reliable when placed on this site, but we cannot guarantee it is accurate or complete or current at all times. The information in this article is for informational purposes only and is not intended to provide financial, legal, accounting or tax advice, and should not be relied upon in that regard. This information is not to be construed as a solicitation to buy. Products and services of the TD Bank Group are only offered in jurisdictions where they may be lawfully offered for sale. All products and services are subject to the terms of the applicable agreement. The information in this article is subject to change without notice.
® The TD logo and other TD trademarks are the property of The Toronto-Dominion Bank or its subsidiaries.
[1] Government of Canada, ‘Credit Report and Score Basics’, Canada.ca, Ottawa, Financial Consumer Agency of Canada, 2020, (accessed 14 May 2025).
[2] Equifax Canada, ‘How Are Credit Scores Calculated’, Equifax Canada, (accessed 14 May 2025)
[3] Equifax Canada, ‘What is a Good Credit Score’, Equifax Canada, (accessed 14 May 2025).
[4] Government of Canada, ‘Improving Your Credit Score’, Canada.ca, Ottawa, Financial Consumer Agency of Canada, 2020, (accessed 14 May 2025).