When you apply for a mortgage or a pre-approval in Canada, your mortgage broker or bank salesperson will request a Credit Report from either Equifax or TransUnion. These are the same organizations that you report lost or stolen credit cards too. They keep a history of loans and defaults registered against you.
Your “Beacon Score”, combined with your credit history, contributes to decisions on you your eligibility for a mortgage, and also play a part in deciding what interest rate you will get.
Hint! Keep your credit card balances under 65-70% of their limit. Even if you are making good on your payments, carrying a balance over that can negatively impact your score.
Hint! Bad Credit does not mean you can never get a mortgage. If you are back on track with your money management, have paid bad debts back even if they were written off, or you have put funds in trust with a lawyer to dispute a derogatory credit score, lenders might take that into consideration. Or, you you may be eligible for a “B” class or private mortgage until your credit score gets better.
For more helpful information on managing your credit, or to order your own report, or to join helpful newsletters, visit both bureaus directly: