How to understand credit rating

The most common ratings, called North American Standard Account Ratings, being with “R,” which indicates “revolving” credit, such as credit cards or lines of credit. They’re coded from 0 to 9, with zero being the most desirable, best score and 9 being the least desirable, worst score. Here’s what Equifax, one of Canada’s two major credit bureaus, says:

  • R0 Too new to rate; approved but not used
  • R1 Pays (or paid) within 30 days of payment due date or not over one payment past due
  • R2 Pays (or paid) in more than 30 days from payment due date, but not more than 60 days, or not more than two payments past due
  • R3 Pays (or paid) in more than 60 days from payment due date, but not more than 90 days, or not more than three payments past due
  • R4 Pays (or paid) in more than 90 days from payment due date, but not more than 120 days, or four payments past due
  • R5 Account is at least 120 days overdue, but is not yet rated “9”
  • R7 Making regular payments through a special arrangement to settle your debts
  • R8 Repossession (voluntary or involuntary return of merchandise)
  • R9 Bad debt; placed for collection; moved without giving a new address


TransUnion, our other big credit bureau, uses a number system that encompasses payment history, outstanding debt compared to credit available (balances above 50% of your limit harm your credit score), credit account history, recent inquiries, and the types of credit you use (a healthy profile uses a mix of credit accounts and loans). A score of more than 650 means you will likely qualify for a standard loan; under 650 means you may have trouble getting credit.





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