A person's credit history includes factors such as credit cards, debt levels, collection accounts and bankruptcies. The three major U.S. credit bureaus, Experian, TransUnion and Equifax, record this information on documents known as credit reports. Additionally, the bureaus use credit report data to determine a person's credit score, which is a numerical value of a person's creditworthiness. An individual moving from the U.S. to Canada should consider the impact on his credit history.
Background
Although Canada has a similar system of credit reporting and scoring as the United States, Canada does not use the same credit bureaus as the U.S. Instead, Canada's major credit bureaus are Equifax Canada and TransUnion Canada. These companies base their credit reporting on information contained in Canadian credit reports. Even though these companies are subsidiaries of their U.S. namesakes, they do not typically share credit reports or identity info with their parent companies. Additionally, Canadian credit reports are tied only to consumers' Social Insurance Numbers (SIN), rather than their U.S. Social Security numbers.
Impact
Most U.S. consumers moving to Canada will not have their old credit histories follow them up north. Instead, they will start new Canadian credit reports and receive credit scores of zero, the staring point for individuals with no credit history. Consumers wishing to use their U.S. financial information to establish credit histories in Canada must provide their American credit card information to the Canadian credit bureaus.
Judgments
A financial judgment is a United States court order in favor of a creditor against a person's assets due to an unpaid debt. Like other negative financial history items, judgments end up on consumers' American credit reports. Unlike other credit history items, creditors can pursue individuals moving to Canada by transferring their judgments from United States to Canadian jurisdiction. Although an individual in this situation will see his American credit score drop, it will usually not have any effect on his Canadian credit score, although it could possibly affect the score in some cases, according to a June 2010 article from Bills.com.
Considerations
Although an immigrant from the United States to Canada gets a fresh start in her credit history, she is still legally liable for her American debts and financial contracts (if any). Failing to pay her old U.S. debts while residing in Canada will ruin her American credit score, making it very difficult for her to obtain credit, find housing or seek employment should she ever decide to return to the States.
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