You can get personal loans in Canada from a variety of lenders, including big banks, credit unions, private lenders and peer-to-peer services. The loan you get can be used for a variety of expenses, and you’ll pay a fixed or variable interest rate on any money you borrow. Learn how to compare lenders and apply for the best loan for your personal situation.
Consider the following factors when comparing personal loans in Canada:
Interest rates. Rates can be fixed or variable and tend to fall between 6.99% and 46.96%. Compare lenders to find the one with the lowest interest rates and the shortest term.
Loan amounts. Some lenders offer amounts up to $50,000. Figure out how much you need to borrow and find a lender willing to give you that amount for the lowest rates.
Turnaround time. Think about how quickly you need the money. If you need a 1-2 day turnaround, you may want to consider fast personal loans.
Loan terms. Loan terms often range from 6 - 60 months. Aim for the shortest term you can afford to keep your interest costs low.
Fees. Some lenders charge administration/origination fees, late fees and early repayment fees on your loan. Read the fine print to make sure you don’t end up with hidden charges.
How to apply for a personal loan
Follow these steps for how to apply for a personal loan to qualify for the loan you want.
1. Figure out how much money you need
Crunch some numbers to figure out how much you need to borrow and how much you can afford to pay back each month. Use our monthly payment calculator below for personal loans to play around with how much you’ll pay with different terms and interest rates.
2. Shop around
Compare multiple lenders and loan types to get a fuller picture of how much you should pay based on your credit score and other personal factors. You can compare lenders using a personal loan broker or by comparing loans manually.
Prequalify for several different loans to make sure you’re comparing the rate you’ll get on your loan (rather than the advertised rate). Getting preapproved for a loan won’t affect your credit score and can give you an idea of where you might find the best deal.
4. Finish the application
Fill out an application form once you’ve decided on the lender you want to go with. You’ll usually need to submit contact details and financial information to apply as well as submit to a credit check.
Calculate your personal loan monthly payment
Calculate how much you could expect to pay each month
Enter the amount you want to borrow under Loan amount.
Write the loan term in years (not months) under Loan terms.
Enter the loan’s interest rate if there are no fees under Interest rate. Otherwise, write the annual percentage rate (APR), which includes interest and fees.
Review your results.
In addition to the monthly payment, our personal loan repayments calculator also tells you how much you’ll pay back on the principal and the total interest you’ll pay. This total interest includes fees if you use your loan’s APR instead of its interest rate.
Interest rates vs APR: What’s the difference?
The key difference between interest rates and APR boils down to the fees you have to pay for your loan.
Interest rates. Interest rates represent the percent of your loan you need to pay back on top of the principal amount you borrow (as a cost of doing business). This number doesn’t include any origination or brokerage fees you may need to pay for your loan.
Annual percentage rate (or APR). Your APR is your interest rate plus the cost of fees or other charges baked into your loan. APR is often used to show the true cost of your loan and will typically be higher than your interest rates alone unless there are no fees.
Home improvement. Use your loan to pay for renovations to your property if you want to increase the resale value of your home.
Post-secondary education. Lock in personal loans to cover the costs of your schooling if you can’t take out government student loans.
Large one-off purchases. Take out a loan to pay for a large one-off purchase such as a new vehicle, mattress or mobile phone.
Daily expenses. Tap into personal loans to cover your everyday expenses or check out a revolving line of credit to cover ongoing costs if a loan doesn’t make sense.
Where can I get a personal loan?
There are a number of different providers that will let you borrow personal loans in Canada. These are summarized in the table below:
How it works
Typical interest rates
Examples of providers
Bank personal loans are provided by Canada’s Big Five Banks and other major financial institutions. These loans often come with higher interest rates and have strict repayment requirements.
Anywhere from 7.5% to 15% with good credit. You may have difficulty getting approved with bad credit.
Providers include BMO, TD Bank, RBC, CIBC, Scotiabank, HSBC, Canadian Western Bank and National Bank.
Credit unions usually provide smaller loans that are a little bit more flexible than big bank loans. You’ll typically need to be signed up with the credit union you want to borrow from to qualify.
Starting from 7.5% with excellent credit. If you have a low credit score, you may be able to get a personal loan from a credit union if you have a good history with them.
Providers include Meridian, Servus, Vancity, Connect First, Conexus, First West, Steinbach, Alterna Savings and Coast Capital Savings.
Private personal loans are typically offered by online and alternative providers. They tend to come with less strict eligibility criteria than bank loans and you may be able to qualify with bad credit. The downside is that they’re often riskier to take out since you could sign up with a predatory or untrustworthy lender.
Varies depending on the lender. Some private lenders offer reasonable rates starting below 10% for good credit while others charge up to 47% for bad credit.
Providers include LoanConnect, Spring, Consumer Capital. Loans Canada, Mogo, Fairstone, Loan Away, SkyCap Financial and FlexMoney.
P2P loans are usually offered through an online platform. This platform connects you to other Canadians who want to give you financing and collect interest on the money you borrow.
Personal loan interest rates for P2Ps start from 8% and up, depending on your credit score.
Providers include goPeer and the r/borrow subreddit (but r/borrow is not regulated in Canada).
What do I need to apply for personal loans in Canada?
You may need to meet the following eligibility criteria to qualify for personal loans in Canada:
Be at least 18 years old or the age of majority in your province or territory
Be a Canadian citizen or a permanent resident with a valid Canadian address
Be employed and have a steady income
Meet credit score and income requirements
To apply for personal loans in Canada, you’ll usually need to provide the following documents:
Identity documents. Personal identification such as your passport or driver’s licence.
Proof of income. Pay stubs, employment records, tax records, proof of government benefits (such as EI) or other documents.
Debt-to-asset ratio. Lists of assets and debts to make sure you can qualify for funding.
Credit score. Consent for your lender to run a credit check.
Can I get a personal loan with bad credit?
There are plenty of lenders offering bad credit personal loans in Canada if you’re struggling to get approved. Just be aware that you’ll usually have to pay much higher interest rates (often over 20%). To improve your chances of getting approved for a bad credit loan, you may want to get a cosigner for your loan, secure your loan with an asset or build up your credit score before you apply.
Personal loans in Canada are easy to apply for and can help you cover a number of expenses. There are many different types of personal loans you can choose from based on what type of interest you want to pay (fixed or variable) as well as whether you want to secure your loan with an asset. Compare online lenders now to find the best personal loan for you and apply today.
Frequently asked questions about personal loans
The most common type of personal loan is an unsecured, fixed rate personal loan. This type of loan doesn’t need you to apply with collateral and you’ll get consistent monthly payments for the duration of your loan.
Low interest personal loans start at 6.99% (for excellent credit). Just be aware that what’s considered a low rate is cyclical and is based on the prime rate in Canada and other environmental factors such as inflation.
It depends. You may need to pay origination fees, late fees or early prepayment penalties with certain lenders. Ask your lender in advance about what fees you may have to pay or compare no-fee personal loans to find a loan with no hidden charges.
You can avoid loan scams by avoiding lenders that aren’t registered in your province or are offering no credit check loans. You should also avoid lenders that want you to pay fees for your loan upfront or are asking you to pay for mortgage insurance.
Claire Horwood is a writer at Finder, specializing in credit cards, loans and other financial products. She has a Bachelor of Arts in Gender Studies from the University of Victoria, and an Associate’s Degree in Science from Camosun College. Much of Claire’s coursework has focused on writing and statistics, with a healthy dose of social and cultural analysis mixed in for good measure. In her spare time, Claire enjoys rock climbing, travelling and drinking inordinate amounts of coffee.
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