Understanding and Improving Credit Scores

2023-01-17  3 minute read

Mary Plahouras

Credit Counselling

Equifax and TransUnion are Canada’s two main consumer credit bureau reporting agencies. They are the two primary sources where secured and unsecured creditors will conduct their search for data on the borrowing history of individuals.

By effectively managing your secured and unsecured debt repayment, you will be well positioned to understand and improve your credit score.

Understanding your credit score

Your credit score is an indication of your creditworthiness. Potential lenders will look at your credit score to determine if you are a credit worthy applicant. They may use your credit score (and your credit rating) as a means of determining how much credit they can grant you.

According to Equifax and TransUnion, credit scores range from 300 to 900 points with a rating of 900 being the best score. As your credit report at the credit bureau is updated by your lenders based on your debt repayment, your credit score will change over time. The higher your credit score, the easier it may be to negotiate and obtain lower interest rates and additional credit from banks, credit unions, credit card companies, and other lenders.

Close up of happy woman viewing credit-score on smartphone on street

Improving your credit score

Equifax will report a bankruptcy on an individual’s credit file for a period of six years from the date of the bankrupt’s discharge and a consumer proposal for a period of three years from the date of full performance of the consumer proposal. In Ontario, TransUnion will report a bankruptcy for a period of seven years from the date of the bankrupt’s discharge and a consumer proposal for a period of three years from the date of full performance of the consumer proposal.

To improve your creditor score and avoid your credit rating from being negatively affected, it’s important that you:

  1. Avoid missed bill payments
  2. Pay your outstanding bills before the statement due date
  3. Pay at least the required minimum statement balance
  4. Stay within your credit limit

Managing your credit bureau information

It’s imperative that you ensure that your personal information reported at the credit bureau is accurate. Erroneous information may result in a potential lender declining your application for credit. One way to ensure the accuracy of your personal information being reported at the credit bureau is to obtain and review a copy of your credit report from Equifax and TransUnion. A good rule of thumb is to check your credit report once a year to ensure that your name, date of birth, address, employment status, creditors, and amounts reported are accurate. You should ensure that creditors reporting at credit bureau are in fact creditors that you owe to, or have an account with, and that there are no fraudulent activities such as debts arising from identity theft, fraudulent use of your credit, or unauthorized inquires made against your credit file.

Credit Bureau Contact Information

To obtain a copy of your credit report, contact:



Consultation icon