Your Canadian credit report will be totally useless to you unless you can understand what your ratings stand for. Here we will explain in simple language exactly what your credit ratings mean, ensuring you fully understand your credit report. For more information or to obtain your Canadian credit reports and score visit www.CreditEh.ca

1. By: Linda Meadley

2. Credit Report Ratings Explained
Ever wonder what an R1 or R9 means?
Each trade item reporting on your credit report consists of a
letter followed by a number.
Here we will break down what it means, so you can fully
understand your credit bureau ratings.

3. Credit Report Ratings Explained
Let’s look at the first part of a credit rating, the LETTER’s and what they mean.
R O I

4. Credit Report Ratings Explained
R
Revolving Credit
This is where you are given a credit limit.
Your balance will go up and down depending on your
payments and purchases you make.
There is no fixed number of payments.
Example: credit cards

5. Credit Report Ratings Explained
I
Installment Credit
This type of credit is where you borrow money once and
repay it back in a fixed number of payments.
Your balance will be reduced with each monthly payment.
You are not able to re-use the original credit granted.
Example: car loan

6. Credit Report Ratings Explained
O
Open Credit
This is where you have a credit limit and can borrow
funds as needed up to that limit.
Your balance is due at the end of a given period, in
which the balance must be paid out in full.
Example: line of credit, overdraft, student loan (where
money is not due until you are out of school)

7. Credit Report Ratings Explained
Now let’s look at the second part of a credit rating, the NUMBER’s and what
they mean.
0
through
9

8. Credit Report Ratings Explained
0 Too new to rate
Approved but not used yet

9. Credit Report Ratings Explained
1 Paid as agreed, within 30 days.

10. Credit Report Ratings Explained
2 Paid more than 30 days late, but not more than 60 days
late.

11. Credit Report Ratings Explained
3 Paid more than 60 days late, but not more than 90 days
late.

12. Credit Report Ratings Explained
4 Paid more than 90 days from due date, but no more
than 120 days.

13. Credit Report Ratings Explained
5 Account is more than 120 days over due.

14. Credit Report Ratings Explained
6 This rating not used

15. Credit Report Ratings Explained
7 When you make regular payments to settle your debts,
through a special arrangement with a debt settlement
company.

16. Credit Report Ratings Explained
8 Repossession of merchandise - voluntary or involuntary

17. Credit Report Ratings Explained
9 Bad debt, placed for collection or bankruptcy

18. Credit Report Ratings Explained
In conclusion, what you are aiming for is all “1’s”
As this is the best possible rating.
R1 or O1or
I1

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