A Free Credit Score in Canada: How to Get It

The three-digit figure known as your credit score represents a snapshot of your entire financial history. Building it to high levels takes months - if not years - and constant commitment. Your spending, repayment habits, and financial decisions impact your credit score and make a difference in the financial products you’ll have access to.

Nonetheless, according to recent IPSOS surveys, nearly 60% of Canadians never check their credit score. And, while the other 40% would also rather not have it, regular checks are the first step to building a better score and becoming more aware of your financial situation.

Luckily, today, there are ways to get a free credit score in Canada. How? Find out below.

Checking Your Credit Score in Canada For Free: Is It Possible?

If you didn’t know that you could check your credit score for free in Canada, you are not alone. In the US, users have been able to access their credit scores and reports for over a decade. However, Canadians had to spend between $20 and $30 at credit reporting agencies such as Equifax to obtain their credit report. Luckily, these days are over.

Today, thanks to the laws recently passed in Quebec and other regions, Canadians now have unrestricted access to their credit scores and reports. This plays a vital role in helping users become more aware of their creditworthiness, boost their credit scores, and understand the financial products within their reach.

How to Check Your Check Your Credit Score For Free in Canada

Now that you can get your credit score for free in Canada, you might be wondering about the best and most reliable way to do so. 

Using a Credit Bureau 

The most trustworthy scores are those you can order directly through credit bureaus, i.e., TransUnion and Equifax.

These credit bureaus collect and manage information about your financial habits and credit utilization in Canada. You can access your credit score information by signing up on their websites.

Leveraging a Third-Party Company

Going through a third-party company can make the process more user-friendly. And, in most cases, the credit score offered by these websites is not far from your official one.

However, it is vital to keep two aspects in mind:

• Third-party sites will be using the information collected by the two official credit bureaus to offer you a free credit score checking service.
• Equifax and TransUnion use different algorithms. Your score might be in the same category (e.i.: very good or excellent), but you might have two different three-digit figures in front of you.

Companies Offering Free Credit Scores in Canada

If you are currently using credit services of a financial institution, such as home loans, personal loans, etc., you might consider ordering your free credit check from your lender. The ones that offer this service free of charge include:

• Mogo - Mogo is a financial services company that offers personal loans, cryptocurrency trading, and mortgages. Equifax credit monitoring is provided as part of a broader credit management toolkit.
• Credit Karma - Credit Karma is a popular personal finance company specializing in credit monitoring. Among this company’s features, you will find credit scores from both Equifax and TransUnion, as well as credit score simulators.
• Borrowell - Borrowell is an established company that offers a wide range of financial services, including credit cards, insurance, personal loans, and mortgages. The company now offers a free Equifax credit score in Canada in addition to expert financial advice.
• Credit Verify - Credit Verify is an emerging financial company offering financial management tools. While you can only access your TransUnion credit score free of charge when subscribing to the company’s service, each subscription is packed with various features, including credit monitoring and building tools.

Free Credit Score Check In Canada: How To Get Started

Before diving into a step-by-step guide on how to check your credit score in Canada for free, let’s distinguish between a soft and hard credit check. Understanding the difference between the two is essential to avoid accidentally knocking a few points off your credit score.

• Soft credit check - a soft credit inquiry or “soft pull” gives you an overview of your credit history. They might be used by a lender or employer as part of a general background check. Most importantly, a soft credit check will not affect your credit score.
• Hard credit check - “hard pulls” are thorough checks of your financial situation usually carried out by a lending institution to assess your creditworthiness. Hard inquiries can temporarily lower your credit score.

If you wish to carry out a soft credit check, the process is extremely straightforward:

1. Select your preferred credit bureau or third-party company
2. Head over to their website and create an account. You will be asked for personal details, including your email, name, and address. However, usually, you won’t be required to submit your credit card details or social insurance number.
3. Start the identity validation process, which might differ for each provider, to access your credit score.

So, that’s how to check your credit score in Canada - it’s free and takes less than three minutes. However, there are some crucial factors to keep in mind:

• Consider checking both your Equifax and TransUnion scores. If you are doing so in preparation for taking out a loan, ask your lending provider what score it uses.
• You can get your credit score by email, fax, or phone.
• Always research third-party companies before signing up.
• Check their website’s security - the URL should start with “HTTPS” instead of “HTTP” in a secure website.

Getting a Free Credit Report in Canada

While your credit score offers you a glance into your financial situation, you might also consider applying for a TransUnion or Equifax free credit report in Canada. Unlike a credit score - which is nothing more than a three-digit figure - a credit report is a detailed breakdown of your financial history.

Similarly to your credit score, you can obtain a credit report from the two main financial bureaus. These documents can help you understand your financial habits, progress, and areas of improvement.

If you are considering applying for any kind of loan, an Equifax or TransUnion free credit report in Canada can help you understand your creditworthiness and lender outlook. Even a minor error in your credit report can affect your credit score and have a snowball effect; reviewing your information regularly can help you avoid unjustified penalties.

How Often Should You Apply For a Free Credit Score and Report?

Now that you know how to order your credit score online, you might be wondering how often you should do so. Generally, your credit score will be automatically updated by the credit bureaus, according to the financial information collected. Thes updates happen every 30-45 days and take into account any information from lenders, such as payment history, credit limit charges, loan repayments, etc.

If you want to keep track of improvements and pitfalls in your financial history, you might consider looking into credit monitoring. A watchdog for your finances, credit monitoring allows you to receive updates regarding your credit score, as well as progress, suggestions, and warnings.

How To Interpret Your Credit Score and Report

Aside from understanding the credit score ranges used by each credit bureau (300-850 for TransUnion and 280-850 for Equifax), it’s essential to understand what makes up your credit score. This is even more important if you are looking to boost it.

Some of the factors impacting your credit score in Canada include:

• Your payment history and repayment habits (35%)
• Your amount owed, credit utilization, and debt-to-income ratio (30%)
• The length and quality of your credit history and credit card usage (15%)
• Frequency and quality of credit inquiries (10%)
• The combination of your credit accounts, loans, and lines of credit - also known as credit mix (10%)

Ultimately, lenders will use these indicators to understand the risk of lending to you and your creditworthiness level.