You can take a lot of things with you when you move from the U.S. to Canada, but credit isn’t usually one of them. Even though moving across the longest border in the world may be easier compared to moving across the globe, it’s still a transitional process that requires planning and time. And, as an American, one of the things that you’ll need a bit of time building is your Canadian credit.
Key Points
- Your U.S. credit history and score will not transfer when you move to Canada.
- You’ll need to start building your credit profile from scratch when you move to Canada.
- Building good credit is important to help you secure loans, rent an apartment, buy a car, and access other financial products.
Does My US Credit Score Transfer To Canada?
Unfortunately, it’s not possible to transfer your U.S. credit score to Canada. In fact, you can’t take your credit score from any country in the world with you to Canada. When you move here, you’ll need to start building your credit profile from scratch, no matter what your credit was like in your home country.
Why Can You Transfer Your US Credit Score To Canada?
While both countries share similar credit reporting systems, they are still different. Each country has a specific credit reporting system with regulations governing it, so the information in your US credit report won’t be shared in Canada when you move.
American Vs. Canadian Credit Reports
In Canada, two main credit bureaus can create a credit report in your name when you start using credit products: Equifax and TransUnion. These two companies also exist in the U.S., along with a third bureau, Experian.
Strictly speaking, both the U.S. and Canadian versions of your report are similar in many ways, containing elements such as your:
- Personal information (name, address, etc.)
- Credit accounts and types (currently & recently active products)
- Credit history (how long products/accounts are used)
- Payment history (paid and unpaid debts)
- Hard and soft inquiries (new credit applications, credit checks, etc.)
However, that said, there are still many differences between them.
Differences Between American Vs. Canadian Credit Scores
A credit score is a 3-digit number that represents your creditworthiness. In the U.S., credit scores range from 300 to 850, while Canadian credit scores range from 300 to 900.
Credit Score Ranges In Canada
Whether you have ‘good’ or ‘bad’ credit depends on where your credit score falls on the spectrum. In Canada, the following credit score ranges are rated as follows:
| Credit Score Rating | Credit Score Range |
| Excellent | 760+ |
| Very Good | 725 – 759 |
| Good | 660 – 724 |
| Fair | 560 – 659 |
| Poor | 300 – 559 |
Canadian Credit Report Rating System
Each credit bureau has a slightly different way of creating and modifying credit-related elements. In Canada, accounts on credit reports are assigned a credit ‘rating’ from 1 to 9, which fluctuates according to your payment activity:
| R0 | Too little credit history or no credit used. |
| R1 | Account paid within 30 days of the due date or one or fewer payments late. |
| R2 | Account paid more than 30 days past the due date, not more than 60 days late, or two or fewer payments late. |
| R3 | Account paid more than 60 days past the due date, not more than 90 days late, or three or fewer payments late. |
| R4 | Account paid more than 90 days past the due date, not more than 120 days late, or four or fewer payments late. |
| R5 | Account paid 120 days late or more but had not yet received an R9. |
| R6 | Not assigned a value. |
| R7 | Account holder is making agreed-upon payments through a debt relief program. |
| R8 | Repossession |
| R9 | Account in collections or bankruptcy. |
Each rating is also accompanied by a letter that indicates the type of credit involved
- I = Installment (loans, etc.)
- R = Revolving (credit cards, etc.)
- O = Open (student loans, etc.)
- M = Mortgage
How To Build A Credit History In Canada
Since your US credit score can’t transfer to Canada along with you, it’s essential to establish yourself as a credit user as soon as you’re settled in your new home. After all, having good credit is just as important here as it is in the United States.
To build a credit history in Canada, you’ll want to become a regular user of credit products and programs, and develop smart and responsible spending habits:
Use Your Credit Card Wisely
One of the best ways to start building credit is to use a credit card responsibly. Every timely payment you make will help you steadily establish your credit profile and can help increase your credit score.
In addition to making on-time bill payments, keeping your expenditures to less than 30% of your credit limit can also help build good credit.
Apply For A Secured Credit Card
If you don’t have a traditional credit card and can’t qualify for one, consider taking out a secured credit card. These types of cards work like regular credit cards, except secured cards require a security deposit which also acts as your credit limit.
Secured credit cards are easy to qualify for and are a great tool for building credit, especially for newcomers and those with bad credit.
Have Your Rent Reported To The Credit Bureaus
Generally, rent payments are not reported to the credit bureaus. However, if you use certain third-party services such as the Landlord Credit Bureau or Chexy, you can have your rent payments reported to the credit bureau. If you pay your rent on time every month, this can help build a positive payment history, which can build and increase your credit score.
Use Credit Building Products
Credit building products are available to those looking to build a credit history or repair their credit scores.
KOHO’s Credit Builder program, for instance, provides a line of credit that may be used to build credit. The credit line requires a monthly subscription fee that is reported to a credit bureau. With each timely subscription fee made, you can steadily build a healthy credit history.
Find The Right Lender
In Canada, most lenders report their clients’ payment activity to at least one credit bureau. However, some lenders don’t report to either. Ensure your lender reports to the credit bureaus before applying for any credit products.
Don’t Apply For Too Many Credit Products
As a newcomer, you should apply for a credit product or two to help you build credit in Canada. But don’t apply for too many all at once. Applying for too many loans or credit products within a short period can have a negative effect on your credit score.
If you’re denied any credit product, wait a few months before applying again to avoid multiple hard inquiries.
Make Bill Payments On Time
Whatever credit product you apply for, the best thing you can do is make timely payments in full every billing cycle. While a credit card allows you to make minimum monthly payments, full balances are healthier for your credit score and finances.
Review Your Credit Report Regularly
Once you’ve developed some credit history in Canada, it’s important to check your credit report periodically for errors or signs of identity fraud, which can harm your credit and finances. If you notice any inaccuracies, report them immediately to have them fixed.
In Canada, you can gain access to your credit report and score for free with Equifax. Similarly, you can request your Consumer Disclosure for free through TransUnion. You can also use third-party services to get your credit scores for free, such as Loans Canada’s Compare Hub
Why Should I Build Credit In Canada After Moving From The U.S.?
Without a credit history in Canada, you’ll find yourself up against several roadblocks. Here are some good reasons why you should start building credit in Canada shortly after you arrive:
You’ll Be Able To Qualify For Financial Products
Without a credit history in Canada, you may not be able to qualify for certain credit products, like credit cards, mortgages, or car loans. That means you may find it more difficult to become a homeowner, buy a car, or take out a personal loan. By building a positive credit history in Canada, you can access these products, which can be very helpful in your new life in Canada.
You May Find It Easier To Rent An Apartment
Many landlords check a tenant’s credit score before agreeing to sign a lease. A good credit score increases the odds that you’ll pay your rent on time, which landlords want. If you have bad credit or no credit at all, it could be more of a challenge to rent, especially if you’re competing with other renters for the same unit.
You May Qualify For Lower Interest Rates
A longer credit history and a good credit score can afford you lower interest rates on financial products, like loans and credit lines. A lower rate can save you a great deal of money in interest payments. So, the sooner you begin building good credit, the better your chances of securing lower rates when applying for credit products.
Will My U.S. Credit Score Affect My Ability to Get A Credit Card Or Loan In Canada?
Your U.S. credit score is separate from what you start building in Canada. It won’t impact your ability to secure a credit product or loan in Canada. Depending on your situation, this may be good or bad for you.
For instance, if you had bad credit in the U.S., then you won’t have to worry about it hindering your ability to secure a loan in Canada. But if you had good credit in the U.S., it may be frustrating that you can’t use this to your advantage when you relocate to Canada.
Final Thoughts
Moving to Canada can be an involved process, no matter where you’re moving from. Among all the things you need to deal with, establishing a healthy financial profile is an important one. Once you’re settled, it’s wise to take immediate steps to start building Canadian credit to take advantage of all the financial products available here.
