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What Does an 800 Credit Score Mean in Canada?

an 800 credit Score in canada

    An 800 credit score isn’t the highest one in Canada, but it might as well be. At this point, you get all the same perks as someone with the holy grail of scores. On the exhilarating journey to financial independence, a high credit score unlocks a ton of financial perks and opportunities. It’s not just a 3-digit number, it’s a doorway to cheaper credit, more flexible terms, better rewards, and more.

    Specifically in Canada, an 800 credit score puts you in an elite class of borrowers. But what does this magical number really mean and more importantly, how do you reach this financial milestone? Let’s demystify these questions. Now, we’ll equip you with the right tools and strategies to help you build an 800 credit score for yourself.

    But first, what is a credit score and why is it important?

    A credit score is a three-digit number that tells lenders how reliable you are to repay loans and manage credit. Before issuing any loan or credit product to anyone, lenders will first check your credit score. As a result, your credit score determines your access credit when you need it, the terms, and the interest rate. Why is that important? 

    In Canada, credit scores range from 300 to 900, with 300 being the lowest and 900 being the best. With lower credit scores, you are less likely to qualify for a loan of your choice. A higher credit score, on the other hand, will help you get the loans you want.

    Believe it or not, your credit score can affect your lifestyle and standard of living. So, you should strive to get a high credit score to help you secure loans with better terms. It can even help you edge out the competition on that great apartment or your dream job. Here’s what you need to know about an 800 credit score in Canada.

    What does an 800 credit score mean? 

    According to Equifax, an 800 credit score is considered excellent. In Canada, the top credit bureaus, Equifax and TransUnion,  decide what the credit score ranges are. Each one uses a slightly different method of calculating your credit score. That means that what one credit bureau might call an excellent score, the other might consider it to be just “very good.” 

    However, both use the same core factors and weigh them similarly, such as your: 

    • Payment history
    • Credit Utilization Ratio
    • Age of credit file
    • Public Records
    • Inquiries 

    If you have an 800 credit score and apply for loans, you are far more likely to get better terms and the lowest rates. In addition, you also have access to some of the best rewards credit cards and cash back credit cards on the market. 

    With an 800 credit score, you qualify for almost every type of loan available. Moreover, such an excellent score will allow you to enjoy quick and easy loan approvals whenever you apply. The ‘800 Club’ is a popular name for customers whose credit scores are 800 and above.

    Habits that get you into the 800 Club 

    People with an 800 credit score did not just get there by chance. It took discipline and consistency to practice good financial habits. If you want to join the club with your own 800 credit score, here’s what you need to do: 

    • Make every single payment on time, without fail 
    • Have a good mix of credit products, from credit cards to personal loans and more
    • Keep old accounts open, even if you do not use or need them anymore 
    • Use but do not carry a balance on your credit cards 
    • Only borrow what you can comfortably afford
    • Only apply for new credit when absolutely necessary

    What an 800 credit score can do for you

    An excellent 800 credit score comes with a lot of amazing benefits. First and foremost, you should have no problem getting approved for loans and other credit products. 

    Quick & easy approvals

    Many financial institutions have a minimum credit score requirement before approving anyone for a loan. Most times, this minimum requirement is in the mid to low 600s. An 800 credit score is well above the minimum threshold, making you a shoo-in based on your score alone. Keep in mind, that lenders also look at other aspects of your financial profile to make sure you can handle a new debt obligation before they approve you. But an 800 credit score won’t be the hangup if there even is one. 

    Lower interest rates, lower payment, and lower cost of credit

    An excellent credit score can also give you lower interest rates. A well-known fact is that a higher credit score will make you eligible for larger loans with more favourable terms and much lower interest rates. In addition, a higher credit score will make it easier to pay back your loan because lenders will be more flexible, and your payments will be lower thanks to lower interest rates. 

    Higher credit limits, better rewards, and even discounts

    Many lenders put much more faith in borrowers with excellent credit scores. This is because their excellent credit score is a by-product of good financial management. 

    Also, you will qualify for higher credit limits and better rewards on credit cards. A higher credit limit automatically gives you higher purchasing power. It also provides you with the best offers on loans, mortgages, better insurance rates, and everything reserved for people with excellent credit scores.                                                                                                                                                               

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    Ways to improve an 800 credit score higher

    An 800 credit score is high and unarguably one of the best credit scores anyone can have. However, as good as 800 is, it’s not the highest credit score you can have. There is still room for improvement to go from “excellent” to “perfect.” 

    If you are someone who likes to be super excellent and the best at everything they do, then you will find this section of the article especially helpful. For example, if you want to improve your credit score from an excellent 800 to a flawless 900, here are a few things you can do:

    1. Make your payments on time

    The importance of on-time payments cannot be overstated. If you wish to improve your credit score, you should make it your top priority to make every single payment on time, or early, without fail. You can set up an automatic reminder to ensure you do not miss any due dates. 

    Many creditors offer pre-authorized payments that automatically come out of your account on the due date so you do not forget to pay and default. A late or missed payment can cause a dent in your impeccable record and reduce your credit score.

    2. Avoid applying for new loans and credit products 

    Sometimes you want to apply for a loan with several lenders to see who gives you the best deal, for example. Or you want several credit cards to capture more points and perks. Searching for the best offer is fantastic, and credit card churning is a great way to snag free travel and other perks. However, you should not do it at the expense of your credit score. 

    Every time you apply for a new loan or credit product, there is a hard credit check done, called an Inquiry.  An occasional Inquiry will have a minimal impact on your score. But many of them, especially in a short period of time, can cause your credit score to drop dramatically. 

    3. Keep your credit accounts open

    The age of your credit history, as well as the age of each of your credit accounts, play significant roles in reaching that coveted 800 credit score. The longer your credit history, the better your lenders can gauge the consistency of your financial responsibility. It’s a testament to your experience in managing debt, and stability in this area shows lenders you’re less of a risk.

    Keeping your oldest accounts open, even if you don’t use them often, adds to the length of your credit history. This longevity, coupled with consistent, on-time payments, contributes positively to your credit score.

    4. Diversify your credit mix

    Diversifying your credit mix is another effective strategy for building a strong credit score. This involves having a variety of credit types — including credit cards, installment loans (like car loans and personal loans), and revolving credit (like a line of credit or home equity line of credit). Demonstrating the ability to handle different types of credit responsibly shows lenders that you are proficient at managing multiple debt streams.

    Having said that, it’s important to remember not to open too many new accounts at once, as this can result in hard inquiries that may temporarily lower your score. Always strive for a balanced, well-managed credit portfolio.

    5. Check your credit report often 

    To calculate your credit score, credit bureaus use the information they receive from your creditors along with computer software and algorithms. This means that the credit score you get depends on the information available, which could have errors. 

    To be sure that your credit score is accurate, you should check it often through Equifax and TransUnion. Then, monitor your profile and report any errors as soon as you notice them. You can also use a free credit score app like Borrowell or ClearScore to check your credit file as often as you want without hurting it. 

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    6. Pay down your credit cards

    Every credit card and line of credit has a credit limit to control how much you can borrow. People with very high credit scores do not carry high balances on their credit cards and lines of credit or even carry a balance at all. Doing the same will keep your credit utilization ratio low, a number that measures how much credit you have access to vs how much you have used. 

    A low credit utilization ratio, under 30% and lower,  is good and will improve your credit score. Do not max out your credit cards and lines of credit. You can use them often, but the best practice is to pay off the balances in full every month, before the statement date.  

    7. Track your finances & stay on budget 

    These steps will not affect your credit score immediately but will do so in the long run. For example, if you create a budget and stick to it, you will be able to set funds aside that you can use to pay down your debt. 

    You should also be conscious of your income and expenses. Ensure you properly account for every dime you spend. This will help you to build excellent financial habits and indirectly impact your score by helping you make all your payments on time, get out of debt, and become less reliant on credit for emergencies and budget shortfalls.  

    Using debt to improve your credit score 

    The trick is to use debt without carrying debt. What do we mean by that? Well, people who borrow regularly and pay it back as agreed are more likely to have higher credit scores. When taking on loans, however, you should proceed with caution. If you borrow more than you can repay, you will hurt your credit score rather than increase it. The best way to ” borrow regularly and pay it back” is to use your credit card as much as possible and pay the balance of in full every month before the statement date.

    The only way to build credit is to use it, but you should be careful not to apply too often or take on more than you can handle. Therefore, as much as you desire to improve your credit score, you should first strive to repay your current debts. If you’re carrying balances on your credit cards right now, use a Credit Card Repayment Calculator to help you get out of debt faster.

    There will always be that pressure to build your credit score until it is relatively high and able to help you get all that you need. However, do not give in to the pressure to impress others with your credit score; instead, strive to be debt free and financially independent

    Putting it all together

    An 800 credit score is considered excellent in Canada. It is a credit score that many people strive to achieve. Who doesn’t want to be a part of the 800 Club?

    Increasing your credit score from a lower score to an 800 credit score is not a difficult feat. It only requires consistency and diligence on your part. Do this, and you will reach this milestone in no time. 

    FAQs about an 800 credit score in Canada

    Is 800 a good credit score?

    Yes indeed! 800 is an excellent credit score. It is only 100 points away from 900, the highest credit score possible in Canada. If you have a good credit score, let nothing stop you from getting an excellent score because your credit score can determine your standard of living. 

    How many people in Canada have an 800 credit score?

    There is no specific number of people with such a high credit score. However, statistics show that roughly 1 out of every seven Canadians has an 800 credit score, which is about 17% of people. In essence, an 800 credit score is not so easy to come by.

    What can I do with an 800 credit score?

    A whole lot of things! For one, you can get a car loan, a mortgage, a credit card, and pretty much anything that requires good credit. An 800 credit score can help you access the solutions to almost all your financial needs. 

    How to get a credit score over 800?

    You must maintain good financial habits to get a credit score above 800. Ensure you make all your bill payments on time and repay your debts as agreed. Also, avoid applying for credit you don’t absolutely need, and make sure to reduce your credit utilization ratio by paying off your credit cards and lines of credit.  Finally, keep your eyes on your credit file to spot any errors. Be consistent and your credit score will increase without much stress.

    How much can I borrow with an 800 credit score?

    Your credit score is one of many factors lenders consider when determining how much you can borrow. While a high credit score like 800 can certainly make you a more attractive borrower, other factors, such as your income, debt-to-income ratio, and the type of loan you’re applying for, will also play a role. That said, having a high credit score often translates into higher borrowing limits, lower interest rates, and more favourable loan terms.

    Can you get an 800 credit score without a mortgage?

    Absolutely. While having a mortgage can contribute to a diversified credit mix—one of the factors used to calculate your credit score—it’s not a prerequisite for achieving an 800 credit score. What’s more important is demonstrating responsible credit usage over time, such as making timely payments, maintaining low balances, and managing a mix of credit types responsibly. And of course, be patient because time is a credit score factor too. The longer you have been responsibly managing debt, the better. So keep things like credit cards and lines of credit open, even if you don’t use them.

    Can I buy a house with an 800 credit score?

    Yes, you can! With a credit score of 800, you’re in a very strong position to be approved for a mortgage loan. A high credit score like this signals to mortgage lenders that you’re a low-risk borrower, which should result in more favourable terms and a lower interest rate. Remember, though, your credit score is just one aspect lenders consider. Other factors like your income, employment history, down payment size, and the property’s value will also be important.

    How can I increase my credit score to 800?

    Achieving a credit score of 800 requires time, patience, and good financial habits. Here are 5 actionable tips to get you started:

    1. Pay your bills on time: Late or missed payments can significantly impact your credit score. Try to pay at least the minimum amount on all your accounts on or before the due date.
    2. Reduce your credit utilization: Your credit utilization is the percentage of your total available credit that you’re currently using on credit cards and lines of credit. As a general rule, it’s advised to keep your credit utilization below 30%. But the best way to get an 800 credit score is to keep your credit utilization at 0% by paying off the balance in full every month.
    3. Diversify your credit: Having a mix of credit types, like credit cards, car loans, and lines of credit, can show lenders that you’re capable of handling various types of credit responsibly.
    4. Limit hard inquiries: Each time a lender or business checks your credit, a hard inquiry is recorded on your credit report. These can lower your credit score, so try to apply for new credit sparingly.
    5. Check your credit report regularly: It’s important to review your credit report for any errors that could impact your credit score. You can get a free copy of your credit report once per year from each of Canada’s credit bureaus, Equifax and TransUnion.

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    Arthur Dubois is a personal finance writer at Hardbacon. Since relocating to Canada, he has successfully built his credit score from scratch and begun investing in the stock market. In addition to his work at Hardbacon, Arthur has contributed to Metro newspaper and several other publications