Building Your Credit History in Canada: A Guide for Newcomers

If you are new to Canada, you may hear people talk about credit scores. But what exactly are they?

A credit score is a three-digit number based on information in your credit report. It gives Canadian lenders an idea of how you have managed credit.

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Businesses may also review your credit score when you apply for certain products or services.

For example, it may be checked when you:

• Apply for a mortgage
• Apply for a credit card
• Rent a place to live

What information is used to determine your credit score?

Your credit score is created using details from your credit report. Credit bureaus use their own formulas to calculate the number, and the exact method is not made public.

In general, a stronger score may be linked to steady bill repayment habits and careful use of credit. Late payments or large outstanding balances may have the opposite effect.

Some of the information that may be reviewed includes:

• Payment track record – whether bills and credit accounts are paid by their due dates
• Outstanding balances – the total amount currently owed on credit cards or loans
• Use of available credit – how much of your credit limit is currently being used
• Age of credit accounts – how long you have had credit products open
• Recent requests for credit – how often you apply for new loans or credit cards
• Serious financial events – items such as accounts sent to collections or bankruptcy appearing on a credit report

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Who keeps track of your credit information in Canada?

Canada’s credit system relies on two national reporting agencies: EquifaxⓇ and TransUnionⓇ. These agencies receive updates from banks, credit card providers, and other lenders about how credit accounts are used and repaid.

The information they collect forms your credit report. Your credit score is calculated from the details in that report. Because lenders regularly send updates, the number may rise or fall over time as your credit activity changes.

For newcomers, it is helpful to know that credit history from another country usually does not transfer to Canada. Many people begin building a Canadian credit record after they arrive.

How lenders may review your credit history

When you apply for credit, lenders often gather information from several places before making a decision.

They may:

• Check whether you already have accounts or a banking relationship with them
• Review the details you provide on your credit application
• Obtain your credit report from a credit bureau

Credit bureaus gather borrowing and repayment information from many lenders and organize it into a report. Looking at your own report occasionally may help you make sure the information is correct and allow you to address any mistakes you notice.

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Understanding credit score ranges

In Canada, credit scores typically fall between 300 and 900. Within that range, scores are often grouped into general categories.

For example:

• 660–724: considered a moderate score
• 725–759: typically viewed as very good
• 760 and above: generally regarded as excellent

What matters most is the overall pattern of how credit is handled. Lenders may use your score as one indicator when deciding whether to approve an application.

A stronger score may make it easier to qualify for products such as loans or credit cards. In some situations, landlords or employers may also review credit information.

Be aware that your credit score is not fixed. It may shift over time as payments are recorded and balances change. So you may be able to improve your score with good financial habits.

Activities that may influence your score

Credit bureaus such as Equifax® and TransUnion® use information from your credit report when producing a score. Certain types of activity may have an impact.

Examples include:

• Requests for new credit – submitting many applications close together may lower a score
• Time using credit – accounts that have been open for longer provide more history to review
• Share of credit used – using a large portion of your available limit may be viewed as higher risk
• Payment behaviour – on-time payments may support a stronger score, while missed payments may reduce it

Understanding how these elements play a role may help you make informed decisions as you build and manage credit in Canada.

Everyday habits that may help build credit

Building credit in Canada usually happens step by step. Over time, consistent financial habits may help create a credit history that lenders can review.

Here are a few practical ways newcomers may begin strengthening their credit profile:

• Set up everyday services in your name: When opening phone or internet accounts, some providers may check your credit. Ask whether payment activity is reported to credit bureaus. Paying these bills regularly and on time may help support your record.
• Use a credit card responsibly: Having a credit card and paying the balance by the due date may help establish borrowing history. TD offers newcomer credit card options as part of the TD New to Canada Banking Package.
• Keep up with scheduled payments: Loans, leases, or financing for things like a car, education, or housing may appear on your credit report. Meeting the payment schedule may help show that you manage credit reliably.
• Create a plan for your spending: A simple budget may help you keep track of bills and avoid missed payments. Digital tools such as the TD App and EasyWeb Online Banking may also help you monitor your accounts and stay organized.

Developing these habits may take time, but steady progress may help you build a stronger credit history in Canada.

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Why Choose TD?

More than 160 years of helping Canadians:

TD has a proud history of delivering financial solutions to Canadians for more than 160 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.

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Sources

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Equifax Canada, What Is a Good Credit Score?, Equifax Canada, 2025, https://www.equifax.ca/personal/education/credit-score/articles/-/learn/what-is-a-good-credit-score/, (accessed 15 March 2026).

Financial Consumer Agency of Canada, Credit Report and Score Basics, Government of Canada, 2025, https://www.canada.ca/en/financial-consumer-agency/services/credit-reports-score/credit-report-score-basics.html, (accessed 15 March 2026).

Financial Consumer Agency of Canada, Improve Your Credit Score, Government of Canada, 2025, https://www.canada.ca/en/financial-consumer-agency/services/credit-reports-score/improve-credit-score.html, (accessed 15 March 2026).

TD Canada Trust, Banking Offers for Newcomers, Toronto, TD Bank Group, 2025, https://www.td.com/ca/en/personal-banking/products/banking-offers-for-newcomers, (accessed 15 March 2026).

TD Canada Trust, Ways to Bank, Toronto, TD Bank Group, 2025, https://www.td.com/ca/en/personal-banking/solutions/ways-to-bank, (accessed 15 March 2026).