First-Time Home Buyer Money GuideCredit Score for a First Mortgage in Canada: What Lenders Actually Check
"You need a 600 credit score" is the sentence that misleads first-time buyers, because it is only half a sentence. A score of 600 can clear the mortgage insurer's minimum and still be declined by the lender sitting across the desk. There is no single number to aim at. There are two gates, run by two different organisations, and a file has to pass both — plus a set of checks that have nothing to do with the score at all.
Gate one: the insurer minimum is 600
On an insured mortgage — the kind required when the down payment is under 20% — CMHC requires a minimum credit score of 600 for at least one borrower. Note the wording. The requirement attaches to at least one borrower, so a co-borrower's score can be lower without breaching the insurer's floor. Canadian credit scores from Equifax and TransUnion run from 300 to 900, which puts 600 in the lower-middle of the scale: a pass mark, not a strong mark.
Passing this gate means the mortgage can be insured. It does not mean any particular lender has to offer it.
Gate two: the lender's own comfort zone
Each lender applies its own policy on top of the insurer's floor, and a 600 score can pass the insurer while still failing individual lender policy. Prime lenders are most comfortable at 680 or above for uninsured files. Below that zone sits a second tier of lenders: B-lenders work roughly the 550–679 range, at rates about 0.5 to 2.0 percentage points higher. That rate gap is the real cost of a thin file — not a refusal, necessarily, but a more expensive mortgage.
| Gate | Number | What it decides |
|---|---|---|
| Insurer minimum (CMHC, insured mortgages) | 600, for at least one borrower | Whether the mortgage can be insured at all |
| Prime lender comfort | 680+ | Access to prime lenders and their standard pricing |
| B-lender range | Roughly 550–679 | Approval possible, at rates about 0.5–2.0 points higher |
| Score scale (Equifax and TransUnion) | 300–900 | Context for every number above |
Read the table from the top down and the common confusion dissolves. Articles quoting 600 are describing the insurer. Articles quoting 680 are describing lender preference. Both numbers are real; they were never measuring the same thing.
Beyond the score: the rest of the file
Score alone does not approve a mortgage. Lenders also weigh the debt service ratios — gross and total debt service, at about 39% and 44% in the guidance the packet's sources cite — together with the mortgage stress test, and two years of payment history. Income stability and existing debts are assessed alongside the score, which is why two applicants carrying the identical score can receive different answers: one has steady income and small debts, the other has new debts and a short history at the job.
Short version: the score opens the conversation. The ratios, the stress test, the payment history, and the income file decide it.
- Payment history, two years deep. Lenders look at two years of payment history, so missed payments from last year are still part of the file. The repair work is simply a run of on-time payments, started now.
- Debts count twice. Existing debts are assessed alongside the score, and their payments also feed the debt service ratios. Paying a balance down helps the file in two places at once.
- Income stability is its own check. A strong score does not substitute for it. Keep employment paperwork — letters, pay records, tax filings — consistent and easy to hand over.
Rate shopping: use the two-week window
One piece of FCAC guidance, as cited in the packet's sources, works in the buyer's favour: multiple mortgage rate-shopping inquiries within about a two-week window are treated as a single inquiry. Shopping three lenders in one fortnight is therefore a different act, on paper, from shopping three lenders across three months. The practical move is to prepare the file first — documents gathered, debts tidied — and then run the rate comparisons close together, inside that window.
None of this requires guessing at a lender's private cut-offs. Ask directly: which score range does this lender price as prime, and what in the file, besides the score, would change the answer? A lender or broker who will not answer those two questions plainly has supplied useful information of a different kind.
FAQ
Is 600 enough for a first mortgage? It meets CMHC's minimum for at least one borrower on an insured mortgage. It can still fail an individual lender's policy, and prime lenders are most comfortable at 680 or above.
Can a co-borrower have a lower score? Yes, under the insurer's rule as sourced: the 600 minimum applies to at least one borrower, and co-borrower scores can be lower. The lender's own policy still applies to the whole file.
Will checking rates with several lenders hurt the score file? Per FCAC guidance cited in the sources, multiple mortgage inquiries within about two weeks are treated as a single inquiry. Clustering the shopping is the point.
What matters most besides the score? The debt service ratios (about 39% gross and 44% total in cited guidance), the stress test, two years of payment history, income stability, and existing debts — assessed together, not one at a time.
General information only, not personal financial advice. Insurer minimums and lender policies change and vary by lender — confirm the current score requirements and ratios with your lender or broker before applying.
— Penny Hughes, Money Writer — Saving Desk
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