Is a Credit Score of 550 Bad?

Is a Credit Score of 550 Bad?

July 3, 2019    Credit Score

A credit score of 550 isn’t great but it doesn’t necessarily mean you can’t get credit or loans. Learn how credit score ranges work in Canada and what a 550 credit score means. 


Credit Score Ranges in Canada

Credit scores in Canada range from 300 to 900, with 900 being the highest score you can achieve. A credit score of 650 is considered middle ground. 


There are several factors that influence your score and where you land on the credit score range. Those include:


  • Payment history
  • Used credit vs. available credit
  • Length of credit history
  • Public records
  • Inquiries into your credit file

What a 550 Credit Score Means

According to Equifax Canada, a credit score range of 660 to 900 is generally considered good to excellent credit. So, is having a credit score of 550 good or bad?


Based on Equifax’s data, anything below 560 would be rated as poor credit. Having a 550 credit score means that you may have a harder time qualifying for loans, credit cards or lines of credit. If you are approved, you may pay a higher interest rate for what you borrow. 


The reason is simple. A lower credit score suggests to lenders that you’re a higher-risk borrower. To compensate for the possibility that you may not repay the loan in full, lenders may charge you more in interest. 

How to Improve Credit Scores

Raising your credit score can make it easier to get approved for loans and land favorable interest rates. If you’re trying to improve your credit and move out of the 550 score range, these tips can help:



  • Pay bills on time. Payment history accounts for the largest part of your credit score so get in the habit of paying all your bills on time each month.
  • Keep balances low. Using less of your credit limit can work in your favor for improving your score. Work on paying existing balances down and limit future charges to what you can pay in full each month.
  • Consider being an authorized user. If you don’t have a credit card, you could leverage someone else’s positive credit history to build your own. Getting added to someone’s card as an authorized user can transplant their positive credit history onto your credit report, helping your score. 
  • Limit new credit applications. Inquiries for new credit cards or loans can knock a few points off your score. Try to avoid applying for credit unless you truly need it. 
  • Check your credit reports. Errors on your credit report could be costing your score points. Get your credit reports and check them carefully for errors, disputing them if you find any. 
  • Keep older accounts open. Closing accounts may be tempting if you’re no longer using them, but keeping older accounts open can increase your credit age which may help your score. 
  • Address negative credit marks. If you have a collection account or a judgment on your credit record, consider what you can do to minimize the damage. Paying off or settling an old collection account, for example, could give your score a small boost


Why Birchwood Credit Solutions Is Different

While some lenders may not work with borrowers who have a credit score of 550, Birchwood Credit Solutions seeks to serve consumers with a variety of credit situations. We can work with you to review your credit, income and work history to find a loan solution that’s appropriate for your needs. Though it may be lower than you’d like, a 550 credit score doesn’t have to prevent you from getting a loan to purchase a new or used vehicle. 


Birchwood Credit Solutions can help customers with bad credit or no credit to meet their car-buying needs. We take your entire financial situation into account. Call today or fill out an online application to learn how we can help you purchase your next car. 

Rebecca Lake
Written by

Free Buyers' Guide

Download our New to Canada Guide

Download Now
Free Buyers' Guide