Every Canadian is eligible for one free credit report annually from each of Canada’s credit bureaus – Equifax and TransUnion. But did you know this free report is different from the ones that lenders use?

Eric Putnam, owner of Debt Coach Canada, stumbled across this fact after reading this US report about credit scores. This part of the survey particularly stood out:

Consumers can purchase their credit scores, but they have a hard time obtaining the same credit scores used by their lenders for evaluating creditworthiness. The CRAs typically sell “educational” scores to consumers
that lenders rarely use.

Credit scores sold to consumers and those used by lenders can vary significantly. A recent analysis by the Consumer Financial Protection Bureau (CFPB) found that the credit scores most often used by lenders compared to the scores consumers most often buy from the CRAs would put consumers in “credit-quality categories that are off by one category 19-24% of the time.”

Putnam looked at some of his Canadian clients’ “free” reports and compared them with the lender versions. The lender version featured different score models – and this wasn’t disclosed in the consumer report. He argues this is because there are no hard and fast Canadian laws regulating credit reports sold to consumers.