When the credit report comes back with a low score, many landlords react by reflex: instant refusal. Understandable but often imprecise. A bad score can reflect very different situations — some disqualifying, others easily compensated. The right decision requires understanding what the score really says.
This article explains how to read a credit report, what a low score actually means, how to analyze it beyond the number, the co-signer's role, and where the legal line in Quebec between objective refusal and discrimination lies.
What the credit score says (and doesn't)
Equifax or TransUnion score is a synthetic rating, generally between 300 and 900, based on five main factors:
- Payment history (35% of the score) — on-time vs late payments
- Credit utilization (30%) — share of available limits used
- History length (15%) — age of credit accounts
- Credit mix (10%) — types of credit (card, loan, line, etc.)
- New inquiries (10%) — frequency of recent applications
| Score | Common reading |
|---|---|
| 750-900 | Excellent — very low risk |
| 680-749 | Very good — low risk |
| 620-679 | Good — moderate risk |
| 560-619 | Average — vigilance required |
| 300-559 | Weak — high risk, deep analysis needed |
Read the report detail, not just the score
Ask for the full report, not just the score. What you're looking for:
Good signals despite a low score
- No late payments in the last 12 months
- Low utilization of available credit (< 30%)
- No collection accounts
- No civil judgment
- Low score due to lack of history (newcomer, young)
Red flags that justify refusal
- Multiple chronic late payments (60-90+ days)
- Active collection accounts
- Bankruptcy or consumer proposal active or recent
- Active wage garnishment
- Civil judgment for unpaid rental debt
- Many recent credit inquiries (financial pressure signal)
Compensating a low score with other elements
A bad score isn't always disqualifying. What can legitimately compensate:
- 1Very strong payment capacity — rent-to-income under 25% instead of the 30-33% standard.
- 2Co-signer with excellent credit and sufficient solo payment capacity.
- 3Impeccable prior-landlord references (at least two, verified by phone).
- 4Long employment stability (3+ years with same employer, permanent status).
- 5Perfectly clean TAL history (no judgment against the candidate).
- 6Voluntary advance payment (1-2 months — legally limited, but a signal).
Co-signer: the most frequent solution
When the primary candidate has insufficient score but otherwise a serious profile (student, young professional, newcomer), the co-signer is the standard solution.
- Co-signer becomes jointly liable for payment — direct recourse against them
- They must provide the same complete file (ID, income, credit verification, references)
- Their own payment capacity must suffice alone (test: could they theoretically pay THEIR rent AND the unit's rent?)
- Their signature appears on the lease in the appropriate section OR in a separate suretyship agreement — include a renewal clause from the outset
Legal line: objective refusal vs discrimination
In Quebec, the Charter of Human Rights and Freedoms protects several characteristics. You can refuse on solvency (objective, defensible criterion), but not on protected characteristics.
Communicating the refusal properly
If you refuse a candidate based on the file, communicate professionally:
- Written response (email or message that can be kept)
- Mention that the file doesn't meet objective selection criteria
- No personalized unsolicited details (can be interpreted)
- Response within a reasonable time (24-72 h after decision)
- Keep internal documentation of your reasoning (just in case)
You're not legally required to give a precise reason for refusal. But to protect yourself, have a documented reasoning based on objective criteria (payment capacity, history, references). That is exactly what a full tenant screening produces: a traceable rationale, candidate by candidate.