September 15, 2025
Many Canadians don’t realize that their credit card habits can make or break their next mortgage approval. Lenders look beyond your score—they analyze how you use revolving credit. Even with on-time payments, carrying high balances or constantly using more than 50% of your available limit can hurt your debt-service ratios and overall risk profile. In 2025, as qualification rules tighten and interest rates remain elevated, small credit missteps can mean the difference between an approval and a decline. A borrower with $15,000 in card balances at 20% interest could see their qualifying amount drop by as much as $60,000 on a typical mortgage application.
One of the biggest misconceptions is that you need to maintain a small balance to “build” credit. In truth, scoring models reward consistent use and full payment, not revolving debt. Paying your statement in full before the due date shows responsible management and helps keep your utilization below the 30% threshold most lenders prefer. Calgary borrowers with multiple cards should also review their limits and usage before applying for or renewing a mortgage—consolidating debt or temporarily reducing available credit lines can make a measurable difference in how lenders view affordability.
Another overlooked factor is the timing of credit checks. Every inquiry made within 30 days of your application can slightly lower your score, especially if it’s for new consumer credit rather than a mortgage rate quote. If you’re planning to buy, refinance, or renew in the next six months, pause any unnecessary credit applications, even store cards or vehicle financing. Lenders interpret recent credit activity as a sign of financial strain, which can lead to higher rates or lower approval limits. In the current environment, clean, stable credit behavior is your strongest advantage.
The takeaway: managing your credit cards wisely isn’t just about avoiding fees—it’s a mortgage strategy. Before applying for your next mortgage, check your utilization, pay down revolving debt, and avoid opening or closing accounts suddenly. These small steps can raise your score, strengthen your ratios, and save thousands over the life of your loan. In 2025’s tight lending climate, smart credit management is just as valuable as finding the right interest rate.
Source: Absolute Mortgage Team