Mortgage Blog
What credit score you need to get lower mortgage rates?
April 1, 2025 | Posted by: Sarabjit Dhuna
In Canada, your credit score plays a crucial role in determining the mortgage rate you qualify for. Here’s a general breakdown:
Ideal Credit Scores for Lower Mortgage Rates:
✅ Excellent (760+): Best mortgage rates available
✅ Good (700-759): Competitive rates, but slightly higher than the best ones
✅ Fair (650-699): Higher rates, may need to negotiate
✅ Poor (600-649): Limited lender options, much higher rates
✅ Below 600: Harder to qualify, may need private or alternative lenders
Key Factors Affecting Your Mortgage Rate:
???? Down Payment: A larger down payment (e.g., 20% or more) can help offset a lower credit score.
???? Debt-to-Income Ratio: Lenders check your overall financial situation, not just your credit score.
???? Employment & Income Stability: A strong, stable income can improve approval chances.
???? Lender Choice: Banks, credit unions, and alternative lenders have different risk tolerances.
If your credit score is below 680, you may have trouble qualifying for prime mortgage rates with major banks. In this case, you may need to go through a B-lender or get a mortgage with the Canada Mortgage and Housing Corporation (CMHC) insurance if your down payment is under 20%.
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