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Compare fixed rate vs. variable rate personal loans

Find out whether you should lock in your rate or flow with the market.

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There are many decisions to make when choosing a loan: you’ll need to pick a lender, decide on your loan term and choose between secured and unsecured loans. Additionally, you’ll also have to decide whether you want your rate to be fixed or variable. These two rate options offer different benefits and drawbacks.

Our guide will take you through the differences between fixed and variable interest rates and help you decide which option is right for you.

LoanConnect Personal Loan

LoanConnect Personal Loan

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10 % APR

rate

  • Submit one application to compare multiple lenders
  • No application or origination fees

LoanConnect Personal Loan

Compare personal loans from a range of lenders and borrow up to $50,000 through this online broker.

  • APR: 10.00%-46.96%
  • Loan amounts: $500-$50,000
  • Loan terms: 6-60 months
  • Fees: No application or origination fees
  • Processing time: Receive funds within as little as 24 hours.
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The key differences between fixed and variable interest rates on personal loans

Fixed ratesVariable rates
DescriptionYour rate remains the same throughout the specified term.Your rate may fluctuate throughout the loan term.
Main benefit
  • Your repayments remain the same no matter what’s happening in the market.
  • Your starting rate is usually lower than that of fixed rate loans and could possibly remain lower, depending on the market.

What are fixed and variable interest rates on personal loans?

Personal loans come with two types of interest rates: fixed or variable.

  • Fixed interest rates remain the same throughout the specified term, which may be for the entire loan term or for an introductory period.
  • Variable interest rates provide you with the current advertised rate, but this rate may change throughout the loan term depending on interest rate movements in the market.

Compare personal loans

Name Product Interest Rate Max. Loan Amount Loan Term Fees Min. Credit Score Link
LoanConnect Personal Loan
10.00%-46.96%
$50,000
6-60 months
No application or origination fees
N/A
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LoanConnect is an online broker that matches borrowers to lenders offering loans in amounts from $500 to $50,000. Get approved for multiple loan offers from different lenders in as little as 60 seconds with any credit score.
Fairstone Personal Loan (Unsecured)
26.99% - 39.99%
$20,000
6 months - 5 years
None
560
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Fairstone offers unsecured personal loans up to $20,000
Cash Money Installment Loan
46.93%
$10,000
6 months - 5 years
Vary across provinces/territories
560
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Cash Money offers installment loans up to $10,000 for AB, MB and NB residents.
LendDirect Personal Loan
19.99% - 46.93%
$15,000
No end dates
None
560
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Borrow up to $15,000, based on your income and credit history, with a personal line of credit from LendDirect.
LendingMate Personal Loan
43% (British Columbia and Ontario) and 34.90% (Quebec)
$10,000
1-5 years
None
700
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More Info
LendingMate offers loans to Canadians with poor credit with no credit checks. Guarantor required for application.
Fairstone Personal Loan (Secured)
19.99% - 23.99%
$35,000
3-10 years
Varies by province
560
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Fairstone offers secured personal loans up to $35,000.
Alpine Credits Home Equity Loan
10.00% - 22.99%
$500,000
Up to 60 months
Between 5% - 8% of your APR will cover closing and admin fees.
300
Check eligibility
More Info
Alpine Credits offer home equity loans in amounts from $10,000 to $500,000. Must be a homeowner to qualify. Check eligibility for this loan through LoanConnect.
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What are the benefits of each interest rate type?

Fixed rate personal loans

  • Your repayments remain unchanged throughout the specified term, so you know what to expect.
  • You may be able to secure a low rate.

Variable rate personal loans

  • The starting rate is usually lower than that of a fixed rate loan.
  • It’s possible for the lower interest rate to remain low throughout the term of your loan.

interest rate choice

What are the drawbacks of each interest rate type?

Fixed rate personal loans

  • The starting rate is usually higher than that of comparable variable rate loans.

Variable rate personal loans

  • Your interest rate could increase and make your loan more expensive over time.
  • You may find less competitive rates.

How do I work out which rate type is best for me?

The right type of interest rate for you will depend on a few different factors. Here are a couple of questions you can ask yourself to help you decide:

  • What interest rate can I get? When you find the most competitive rate, be sure to check the eligibility criteria of that loan to see if you qualify.
  • How affordable are the monthly payments? If your repayments are only just fitting into your monthly budget, a fixed rate loan will ensure they won’t increase. Taking on a variable rate may be risky, since your loan repayments could possibly increase.

Frequently asked questions

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