Updated November 6, 2026. Every figure below is dated and linked to its source.
Short answer: In Canada, most bad credit lasts up to 6 years. Late payments, collections and judgments usually drop off your credit report after 6 years. A consumer proposal leaves 3 years after you finish paying, or 6 years after you sign, whichever is first. A first bankruptcy stays 6 or 7 years after discharge, as of 2026.
Key facts, November 2026
- Late or missed payments stay on your credit report for up to 6 years, according to the Financial Consumer Agency of Canada (FCAC, 2026).
- A first bankruptcy is usually removed 6 years after discharge, but TransUnion Canada keeps it 7 years in Ontario, Newfoundland and Labrador, Prince Edward Island and Quebec, according to the FCAC (2026).
- Equifax Canada (2026) removes a consumer proposal 3 years after all payments are made, or 6 years after the filing date, whichever comes first.
- People who declare bankruptcy more than once have that information kept on their credit report for 14 years, according to the FCAC (2026).
- Canadians filed 146,135 consumer insolvencies in the 12 months to August 31, 2026, up 5.8%, according to the Office of the Superintendent of Bankruptcy (OSB, 2026).
Definition. How long bad credit lasts in Canada is the time a negative item, such as a late payment, collection, consumer proposal or bankruptcy, stays on your Equifax or TransUnion credit report before it is removed.
How long does bad credit last in Canada?
Bad credit in Canada usually lasts up to 6 years, because that is how long most negative items stay on your credit report. The FCAC (2026) says late payments, missed payments and unpaid cards or loans stay for up to 6 years. Judgments usually stay 6 years too. Your score can start to recover long before an item disappears, since recent behaviour carries the most weight.
A bad credit score is not a single mark with one expiry date. It is the result of everything in your file. According to Equifax Canada (2026), scores range from 300 to 900, and scores generally below 560 are poor. Scores from 660 to 724 are good. If you want the full breakdown of the score bands, read our guide to what a bad credit score is in Canada.
Two credit bureaus hold your file in Canada: Equifax Canada and TransUnion Canada. Each one sets its own retention rules within provincial law. That is why the same bankruptcy can leave one report a year before the other. Lenders may check one bureau or both, so it helps to know both timelines. You can get free copies of both reports to see the exact dates that apply to you.
Bad credit is also common right now. Equifax Canada (May 2026) reported that 1.5 million Canadians, or 1 in 21 consumers, missed at least one credit payment in the first quarter of 2026. If that includes you, the clock on your late payment has already started.
How long does each negative item stay on your credit report?
Each negative item has its own timeline, and most of them end at 6 years. The table below compares how long common items stay with Equifax Canada and TransUnion Canada. It uses the FCAC page updated July 1, 2026 and the Equifax Canada retention page, both checked on November 6, 2026.
| Negative item | Equifax Canada | TransUnion Canada | When the clock starts |
|---|---|---|---|
| Late or missed payment | Up to 6 years | Up to 6 years | Date the late payment was reported |
| Collection or charged-off account | 6 years | Not listed separately by the FCAC | Date of first delinquency (Equifax) |
| NSF or returned payment (banking item) | 6 years | Not stated by the FCAC | Date reported (Equifax) |
| Judgment | 6 years | 6 years; 7 in ON, NL and QC; 10 in PEI | Date of the judgment |
| Debt management program | 2 years after debts are paid | 2 years after debts are paid | Date the debts are fully paid |
| Consumer proposal | 3 years after paid, or 6 years after filing, whichever is first | 3 years after paid, or 6 years after signing, whichever is first | Filing date or final payment |
| First bankruptcy | 6 years after discharge (7 years after filing if no discharge) | 6 years after discharge; 7 in ON, NL, PEI and QC | Discharge date |
| Second bankruptcy | 14 years | 14 years | Discharge date |
| Hard inquiry | 3 years | 6 years | Date of the inquiry |
Paying a late account does not erase it. Equifax Canada (2026) says a late payment stays up to 6 years even if you pay the past-due balance. A collection paid early still stays until 6 years after the first delinquency. Paying still matters, though. A paid collection usually hurts your score less than an unpaid one, and it stops new damage.
Good history can outlast bad history. The FCAC (2026) says TransUnion Canada can keep positive information for up to 20 years, even after an account is closed. That is a reason not to close your oldest card in good standing just because you want a fresh start.
How long do a consumer proposal and a bankruptcy affect your credit?
A consumer proposal usually affects your credit for less time than a bankruptcy. A proposal leaves your report 3 years after you finish paying or 6 years after you sign, whichever comes first. A first bankruptcy stays 6 or 7 years after discharge, depending on the bureau and the province. A second bankruptcy stays 14 years.
The length of the process itself also counts. The Office of the Superintendent of Bankruptcy says the term of a consumer proposal cannot exceed five years. The OSB also explains that a first bankruptcy can end with an automatic discharge after 9 months. It is extended to 21 months if your surplus income is over $200 a month.
Here is how that plays out with real dates. Say you file a first bankruptcy in January 2027 and get discharged in October 2027. Equifax would remove it around October 2033. If you live in Ontario, TransUnion would keep it until around October 2034. A consumer proposal signed in January 2027 and paid off in January 2029 would leave around January 2032. That is 3 years after the last payment, which comes before the 6-year mark of January 2033.
Proposals are now the more common choice. The OSB (August 2026) counted 114,026 consumer proposals and 32,109 consumer bankruptcies in the 12 months to August 31, 2026. Proposals made up 78.0% of consumer insolvencies in that period. In August 2026 alone, consumer insolvencies rose 4.0% from a year earlier.
Does bad credit really last the full 6 years?
No, the damage to your score usually fades well before the 6 years are up. Scoring models put the most weight on recent behaviour. A late payment from five years ago, followed by five clean years, matters far less than one from last month. The item is still visible, but lenders read it in context.
What keeps bad credit going is new trouble. Each fresh late payment restarts the damage, even if the old ones are close to dropping off. That is why the first goal after a rough patch is simple: no new missed payments. A single on-time history of 12 months often does more for your score than any one-time fix.
It also helps to know what does not happen. Your report is not wiped when you pay a debt. Moving to another province does not reset your file. A debt that is too old for a collector to sue on may still appear until its 6-year reporting date. If you are not sure how bad your current file looks, our post on no credit vs bad credit explains how lenders read thin and damaged files.
Lenders also look beyond the score. Many short-term lenders weigh your income, your bank deposits and how long you have been at your job. A bad score with steady income can still qualify for a small loan, even while old marks are on your report.
How to borrow while bad credit is still on your report, in 6 steps
You can still borrow a small amount while old marks are on your report, if you show steady income and apply in a way that does not add new damage. Loan Boys is a Canadian loan-matching service: one short application is reviewed by several lenders, with no hard credit check and repayment over 3 to 6 months. That setup is why Loan Boys has high approval rates: one application reaches several lenders, and your score is not hit by a hard pull. Loan Boys serves Ontario, Alberta, British Columbia, Manitoba, Saskatchewan, Nova Scotia, New Brunswick and Newfoundland and Labrador. You need to be 18 or older, a Canadian resident and have regular income.
- Pull both credit reports first. Get your free Equifax Canada and TransUnion Canada reports. Note the date each negative item was reported, so you know when it should drop off.
- Dispute anything past its date. If a late payment or collection is older than its retention period, ask the bureau to remove it. Disputes with the credit bureaus are free.
- Set a payment you can keep. Add up rent, food, bills and existing debts. Choose a monthly payment that still leaves room for a surprise bill, since a new missed payment restarts the damage.
- Apply once, not ten times. Start your application online. It takes a few minutes and does not trigger a hard credit pull.
- Compare offers in dollars. Check the APR, the total cost, the number of payments and any fees. Turn down any offer you cannot repay on time.
- Sign, receive and automate. Decisions usually come in minutes during business hours, and funds arrive by e-Transfer once you sign. Set up automatic payments or reminders for every due date.
Applying through one matching service protects a damaged file. The FCAC (2026) says TransUnion Canada keeps hard inquiries for 6 years, and Equifax Canada keeps them for 3 years. Ten separate applications can leave ten inquiries that outlast the loan itself.
What does a small loan cost while you rebuild?
A small loan with bad credit in Canada can cost up to 35% APR, the legal maximum, with all fees counted. Under Criminal Code section 347 and the Criminal Interest Rate Regulations (SOR/2024-114), a rate above 35% APR is criminal for agreements made on or after January 1, 2025. Lenders that serve people with bad credit often price close to that cap.
The table below compares monthly payments and total interest on instalment loans of $500, $1,000 and $1,500 at 35% APR over 3 and 6 months. Loan Boys calculated these figures on November 6, 2026, assuming equal monthly payments, a monthly rate of 0.35 divided by 12, no extra fees and on-time payments.
| Loan amount and term | Monthly payment | Total repaid | Total interest |
|---|---|---|---|
| $500 over 3 months | $176.48 | $529.44 | $29.44 |
| $500 over 6 months | $92.04 | $552.24 | $52.24 |
| $1,000 over 3 months | $352.96 | $1,058.88 | $58.88 |
| $1,000 over 6 months | $184.09 | $1,104.54 | $104.54 |
| $1,500 over 3 months | $529.45 | $1,588.35 | $88.35 |
| $1,500 over 6 months | $276.13 | $1,656.78 | $156.78 |
A shorter term costs less in total but needs a bigger monthly payment. A $1,000 loan over 3 months costs $58.88 in interest at 35% APR, compared with $104.54 over 6 months. Pick the shortest term whose payment you can make every month without missing one.
On-time payments on a small instalment loan can help your file if the lender reports to a credit bureau. Ask each lender whether it reports to Equifax Canada or TransUnion Canada before you sign.
What mistakes make bad credit last longer, and what are your rights?
The biggest mistake is adding new negative items while the old ones age. A fresh late payment, a new collection or a bounced payment each starts its own 6-year clock. Here are the mistakes that keep people stuck:
- Paying a company to erase accurate items. No one can legally remove correct, current information from your report before its date. Accurate negative items stay until their retention period ends.
- Applying everywhere at once. Each hard inquiry stays 3 years with Equifax Canada and 6 years with TransUnion Canada, according to the FCAC (2026).
- Ignoring a collection. Paying it will not remove it early, but a paid collection usually weighs less than an unpaid one and ends the calls.
- Closing old accounts in good standing. Positive history helps balance out the negative items still on your report.
- Taking a loan you cannot repay. One missed payment on a new loan undoes months of rebuilding.
You also have rights. You can ask Equifax Canada and TransUnion Canada to correct an error on your credit report, and the bureaus do not charge for a dispute. If an item is still listed after its retention date, file a dispute with the bureau that shows it, and keep a copy of your report and your letter.
What should you do next to rebuild faster?
The fastest way to shorten the effect of bad credit is to add new positive history every month. Old negative items lose weight as fresh on-time payments pile up. Three tools work well together.
A secured credit card is the classic option. You leave a deposit, use the card for small purchases and pay the balance in full each month. Most secured cards report to the credit bureaus, so each on-time payment adds a positive line to your file.
A credit-building membership is another option. AvenaCredit is a credit-building membership that reports a monthly tradeline to Equifax Canada, so each on-time month adds to your history without a new loan.
The third tool is a calendar. Write down the date each negative item should leave your report, using the table above. Check both reports a month after each date. If an item is still there, dispute it. Many people find their score jumps once a bankruptcy or proposal finally drops off, so plan big applications, such as a car loan or a lease, for after that date.
Related questions
Does bad credit go away after 7 years in Canada?
Most bad credit leaves after 6 years in Canada, not 7. A first bankruptcy can stay 7 years with TransUnion Canada in Ontario, Newfoundland and Labrador, Prince Edward Island and Quebec.
Can I get a loan after a consumer proposal?
Yes, many lenders look at income and recent payment history. A proposal leaves your report 3 years after you finish paying, or 6 years after you sign, whichever is first.
Do debts disappear after 6 years in Canada?
The record usually leaves your credit report after 6 years, but the debt itself may still be owed. Removal from your report is not the same as forgiveness.
How long does a hard inquiry stay on my credit report?
A hard inquiry stays 3 years with Equifax Canada and 6 years with TransUnion Canada, according to the FCAC (2026).
Sources
- Financial Consumer Agency of Canada: How long information stays on your credit report (modified July 1, 2026)
- Financial Consumer Agency of Canada: Credit report and score basics (modified July 1, 2026)
- Equifax Canada: How long does information stay on your credit report? (2026)
- Equifax Canada: What is a good credit score? (2026)
- Equifax Canada Market Pulse, Q1 2026 (May 26, 2026)
- Office of the Superintendent of Bankruptcy: Insolvency statistics in Canada, August 2026
- Office of the Superintendent of Bankruptcy: Considering bankruptcy
- Office of the Superintendent of Bankruptcy: Consumer proposals
- Criminal Code, section 347
- Criminal Interest Rate Regulations (SOR/2024-114)
About the author
LoanBoys Editorial Team
Personal finance writers, Loan Boys
Every figure in this guide is checked against its primary source and dated. Drafts are prepared with AI assistance and edited by a person before publication.
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