5 loans to consolidate payday loan debt

If you are currently repaying 2 or more payday loans and finding the repayments difficult to manage, you may be wondering what your debt consolidation options are.

In our guide, we cover providers that could help you consolidate payday loan debt and strategies to pursue if you want to pay down your loan debt without taking out another loan.

5 loans to consolidate payday loan debt

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Loans Canada Installment Loan

$500 – $50,000
Loan amount

8% – 46.96%
APR

4 - 60 months
Term

• Info
• Features
• Details

Loans Canada is partnered with over 60 lenders to help you find a loan to consolidate payday loan debt.

• Largest lender network in Canada
• One application provides you with multiple loan offers.
• Free to use.

• Potential for excruciatingly high interest rates if you have bad credit.
• Only receive quotes from lenders partnered with Loans Canada.
• High interest rates for bad credit

Loan amount	$500 – $50,000
APR	8% – 46.96%
Term	4 - 60 months
Interest Rate Type	Fixed
Min. Credit Score	300
Fees	No application or origination fees.
Origination Fee	0
Turnaround Time	Receive funds within as little as 24 hours.

Finder Rating: ★★★★★ 4.6 / 5 Go to site Read review

LoanConnect Personal Loan

$100 – $50,000
Loan amount

6.99% – 46.96%
APR

3 - 120 months
Term

• Info
• Features
• Details

LoanConnect is another online broker. Fill out 1 application and get matched with lenders that are open to financing you.

• Fast, free and easy to use.
• Get pre-approved within minutes of applying.

• Interest rates up to 46.96%.
• No in-person customer service.

Loan amount	$100 – $50,000
APR	6.99% – 46.96%
Term	3 - 120 months
Interest Rate Type	Fixed
Min. Credit Score	300
Fees	No application, origination or brokerage fees
Origination Fee	0
Turnaround Time	Receive funds within as little as 24 hours.

Finder Rating: ★★★★★ 4 / 5 Go to site Read review

Spring Financial Personal Loan

$500 – $35,000
Loan amount

9.99% – 46.96%
APR

6 - 60 months
Term

• Info
• Features
• Details

Spring Financial offers personal loans to people who don't qualify for a bank personal loan. If you don't qualify for a Spring personal loan, it may promote its credit builder loan to you instead.

• High-risk applications, such as those with bad credit, can apply.
• No fees for applying, maintenance or any other hidden costs.

• Interest rates of up to 46.96% for bad credit.
• With a credit builder loan, you don't access the money until after you pay off your loan

Loan amount	$500 – $35,000
APR	9.99% – 46.96%
Term	6 - 60 months
Interest Rate Type	Fixed
Min. Credit Score	500
Fees	No fees except $30 NSF fee
Origination Fee	N/A
Turnaround Time	Within 24 hours

Finder Rating: ★★★★★ 4.5 / 5 Go to site Read review

Mogo Personal Loan

$200 – $35,000
Loan amount

9.9% – 46.96%
APR

6 - 60 months
Term

• Info
• Features
• Details

Mogo offers personal loans to people with good or bad credit. Get a quote within minutes without affecting your credit score.

• Loan flexibility, starting at $200 up to $35,000
• Lower starting rate at 9.9%
• No early repayment penalties for paying off some or all of your loan ahead of time
• Bad credit doesn't matter

• Rates as high as 46.96%
• Not available across Canada.
• No in-person customer service available

Loan amount	$200 – $35,000
APR	9.9% – 46.96%
Term	6 - 60 months
Interest Rate Type	Fixed
Min. Credit Score	500
Fees	Non-sufficient funds fee of $20 to $50
Origination Fee	$0
Turnaround Time	Within 24 hours

Go to site Read review

Debt.ca

N/A
Loan amount

N/A
APR

Varies
Term

• Info
• Features
• Details

Debt.ca does not offer loans to consolidate payday loan debt. Instead, it'll connect you to a debt relief provider. It's a legitimate option if you're struggling to keep up with all your debts and can't get approved for a consolidation loan.

• Get matched with a licensed specialist
• Free to use

• Serious debt relief options will negatively affect your credit score
• Your creditors may not be willing to negotiate

Loan amount	N/A
APR	N/A
Term	Varies
Interest Rate Type	Fixed
Min. Credit Score	300
Fees	Varies (depends on the company you're connected with)

What exactly is payday loan consolidation?

Payday loan consolidation involves combining your multiple payday loan debts into 1 loan, often at a lower interest rate. Typically, the lender will pay off your payday lenders, and then you will make regular repayments spread out over a period of time to your new lender.

The interest rate of your debt consolidation loan will depend on personal factors such as your credit score and income.

4 strategies to pay down payday loan debt without taking out another loan

If you don’t qualify for a loan to consolidate your payday loan debt, consider these alternatives:

• Negotiate with your creditors. Payday lenders have a collections department that may be able to offer you assistance or help you establish a repayment plan. The earlier you get in touch with your lender, the easier it’ll likely be for you to get an extended repayment plan. Some lenders will be willing to work with you through your difficult financial times, so don’t be afraid to ask.
• Draw up a budget. Sit down and work out all of your income and expenses and see where you can cut back. Consider a free online budgeting software or a smartphone app to help you keep track of your finances. Any monthly savings you can scrape together can go toward your loan repayments.
• Work with a credit counsellor. Reputable credit counsellors can recommend ways to work out a budget and often offer free materials and workshops to help you manage your debt for the long term. If you would like free financial counselling, call Credit Counselling Canada at 1-866-398-5999. It’s open from 8:00am to 5pm, Monday to Friday.
• Consider a debt relief company. If you’re facing legitimate financial hardship, debt relief companies can help by sitting down with you and going through all your viable options, including credit counselling, debt settlement, consumer proposal and bankruptcy.

Other ways to borrow money

• Line of credit. Contact your bank and see if you can open a line of credit. Your bank can offer lower rates than most alternative lenders.
• Borrow from friends or family. It can be a delicate situation, but you may want to consider turning to friends or family. Be clear that you want a loan and not a gift, and give details on how much you need, how you’ll spend it and when you can reasonably pay it back. Be as detailed as possible to help reassure them that lending to you isn’t a risk.
• Overdraft protection. You can get this from your bank, and it allows you to withdraw more than what you have in your bank account for a fee. This is typically $5 per month or per use plus around 21% interest per year of the overdrawn amount.

Frequently asked questions

• Can I transfer my payday loan debt to a loan that a friend or a relative takes out?

  No, you’re only able to transfer your existing debts to new loans you take out in your own name. If a friend or relative is going to take on your debt, they will need to pay your debt off and take out a new debt under their own name.

• Can I get a debt consolidation loan if I have bad credit?

  Yes, but you likely won’t qualify for a low interest rate. Any score below 660 is going to flag you as having less than good credit. You may want to look into installment loans, which tend to come with more lenient eligibility criteria and offer amounts high enough to consolidate a few short term loans. You will also have a longer period of time to pay off an installment loan and you can generally secure a better interest rate than that of a payday loan.

• How does debt consolidation affect my credit score?

  Taking out a new loan or credit card to use for debt consolidation will temporarily lower your credit score by about 5 points, since lenders will pull a hard credit check in order to decide whether to approve you or not for the loan. However, less debt means better credit. So in the long run, debt consolidation will ultimately help your credit score.