If you need to finance a large purchase or consolidate debt, a personal loan could be the right solution for you. But how do you know the best option for your unique financial situation? Forbes Advisor may earn commission on sales from providers listed on this page. However, this doesn’t impact our independent opinions or evaluations of the products and services listed.
Personal Loans are a common choice for Canadians who need to pay off a large expense or cover unexpected expenses. These loans can range from $500 to $50,000 and are usually unsecured, meaning you don’t need cash or an asset as collateral. The money you borrow is paid back in installments over a set term along with interest.
How to Boost Your Approval Odds: Tips for a Successful Personal Loan Application in Canada
You can apply for a personal loan through traditional banks like CIBC or BMO, credit unions, and private lenders. Most of these lenders use your credit score and other factors such as your debt-to-income ratio and employment status to determine whether or not you qualify for a personal loan and what interest rate you’ll be charged. Banks typically have the strictest eligibility requirements.
Online lenders offer personal loans to borrowers with a wide range of credit scores and financial situations. These providers generally have quick application and processing times and many boast turnarounds of just a few days. Once approved, you can expect to receive your funds via e-Transfer or direct deposit. Some lenders even allow you to test-drive a personal loan for up to 48 hours.