Personal loans in Quebec

Personal loans in Quebec give you access to a set amount of money of anywhere between $500 and $50,000 with a repayment period of around 3 to 60 months or longer. You can find personal loans in Quebec typically from banks, credit unions and online lenders.

Types of personal loans in Quebec

There are several types of personal loans in Quebec. From secured loans to unsecured loans, to fixed rate loans and variable rate loans, each type comes with its own set of features worth considering if you’re going to narrow down your options to find the right loan for your needs.

• Secured loans

  If you’re looking for a larger-sized personal loan in Quebec, a secured loan may be your best bet. Secured loans involve some sort of collateral – like your house or car – that acts as insurance to your lender in case you default. Securing a loan is the most traditional way to get approved for a personal loan in Quebec, especially if you want to take out a large chunk of money, and they often come with the lowest interest rates.

• Unsecured loans

  Unsecured loans come with higher interest rates because they don’t require any form of collateral. Without an asset acting as insurance on your loan, your lender will rely more heavily on your credit score and monthly income to determine your eligibility for a loan. You’ll notice that unsecured loans are commonplace for online lenders – the application and approval process is usually pretty fast, which means Quebecers could secure a loan within the same day of applying.

• Fixed rate loans

  If you prefer a set repayment plan, fixed rate personal loans will lock in your interest rate at the beginning of your loan term so your payments stay consistent. A fixed rate personal loan in Quebec can last anywhere from one year up to as long as a decade, depending on how much you’re borrowing. Having a set repayment plan for the life of your loan is a big benefit, especially if you need to make sure your loan repayments fit into your budget each month.

• Variable rate loans

  Your other option is to take out a variable rate personal loan. Your rate will change depending on what the Bank of Canada does with its lending rate. Your monthly payments will generally stay the same, but more or less will go towards the interest portion of the payment, depending on whether your rate goes up or down.

• Cosigned loans

  If you can’t qualify for a traditional loan on your own, you can ask someone close to you to cosign on your loan and act as a guarantor. This guarantor must accept responsibility for repaying your loan if you default on your payments (and their credit score suffers when repayments aren’t made on time). Guarantor loans are especially suited for Quebecers with no or low credit scores.

• Debt consolidation loans

  With a debt consolidation loan, you combine your existing debts into one loan and make a single payment to your consolidation loan lender. Depending on your current financial situation, the lender may give you a lower rate, or it may give you lower monthly payments over a longer term. Learn more about the best debt consolidation loans.

How to choose the right personal loan in Quebec

You know you need financing, but with many personal loans in Quebec, how do you decide? There are several factors that will help you narrow down your shortlist. Here’s what to keep in mind.

• Figure out what type of personal loan you need

  Can you offer collateral? Are you comfortable with your interest rate going up or down during the life of the loan? Would you prefer to apply to a major bank or are you open to alternative lenders?

• Shop around for interest rates

  Next, consider the annual percentage rates, or APRs, which will dictate how much you’ll spend to take out your loan. Personal loan rates in Quebec can range as low as 6.99% to as high as 46.96%. Compare interest rates between lenders to make sure you’re getting a loan at a competitive rate.

• Check that you are eligible

  Some lenders only provide loans in certain provinces, while others won’t work with self-employed applicants or anyone relying solely on government assistance, for example. If you have your sights set on one lender, double check to make sure you meet the minimum eligibility requirements.

• Pay attention to any fees and charges

  Fees can add unnecessary costs to your loan. Fees to watch out for include administration or origination fees, NSF fees and late payment fees.

• Determine terms and repayment options that fit your budget

  How long you intend to take to pay off your loan and how much of your budget you can allocate to your loan repayments are also important factors to take stock of. Make sure the lender you want to work with provides loan terms that suit your needs. Most personal loan lenders in Quebec will offer flexibility in your repayment plan, providing you with the option to make payments weekly, bi-weekly, semi-monthly or monthly.

• Use a repayment calculator to compare costs

  Comparing interest rates is a good way to get a quick idea of which loan is the least expensive – as long as they have the same terms. When you’ve narrowed down your choices, use our calculator to find out how much each option might cost you in the short and long terms.

Best places to get a personal loan in Quebec

Personal loans come with a handful of important decisions to make, including choosing your lender. Because personal loans come in so many different shapes and sizes, you can narrow your scope by deciding on the type of lender you want to work with to secure your funding. Here are the top places to get a personal loan in Quebec.

• Banks

  The most traditional route to securing a personal loan is by working with one of Canada’s Big Five Banks and other major financial institutions. Personal loans issued by banks will come with lower interest rates compared to other lenders but you’ll need to keep in mind that they have strict eligibility requirements. If you have bad credit, you may have to rule out banks in your search for a personal loan.

• Credit unions

  Credit union personal loans are a little bit more flexible than big bank loans. You can start your search for credit unions in Quebec, or zero in on local credit unions within the province. You’ll usually need to apply to be a member of the credit union to get a personal loan. These loans typically have more competitive interest rates than big bank loans and some private lenders.

• Online lenders and brokers

  There is an abundance of personal loans on offer from dozens of online lenders or brokers. Across the board, these providers try to make the loans process as seamless as possible, via online-only applications, quick approvals and fast funding. Alternative lenders also offer flexible repayment terms and the ability to qualify regardless of your credit score. There is a catch though: the more complicated your credit history and income is, the higher your interest rate. Compare online lenders.

How much does a personal loan in Quebec cost?

Between interest rates, origination fees and other charges, the cost of your loan can quickly add up.

Lenders in Quebec aren’t allowed to charge more than the federal maximum limit of 60% interest on personal loans. The cheapest lenders are typically the credit unions and banks, which can charge rates as low as 9% on loans. However, they work mainly with borrowers who have good credit scores.

Online lenders can offer loans to borrowers with good or bad credit. They also have a much wider interest rate range, with rates between 6.99% and 46.96%. If you have great credit, your interest rate should fall on the lower end of the range. But keep in mind, the lowest rate that lenders advertise are usually reserved for the best type of borrower (excellent credit score, very high income, many assets and minimal debt).

Compare costs for types of personal loan providers in Quebec

Benefits of personal loans in Quebec

Personal loans can be a godsend if you’re stuck with a big-ticket purchase or emergency repair that you can’t afford. But they also come with other benefits too, including:

• Flexibility for using the funds. Whether you’re consolidating debts, buying a car, paying for a home renovation or taking a vacation, once your funds are sent over to you, you can use the cash at your discretion.
• Quick financing. After getting approved, lenders typically transfer over funds within one to two business days.
• Affordable payments. Pay less in interest than you might have to with a credit card or short-term loan (unless you have bad credit).
• Large amounts. Qualify for larger amounts of credit than you might be able to with a credit card or payday loan.
• Longer terms. Pay your loan off with consistent repayments over a longer term to make sure you stay within your allotted budget.
• Multiple lenders. Compare personal loans from a number of different lenders to find the best terms and rates for your unique personal situation.
• Bad credit can qualify. Quebecers may still be able to qualify for a loan with bad credit if you’re willing to accept higher interest rates, secure your loan with assets or enlist a cosigner.
• Build up your credit history. Taking out a personal loan and staying on top of payments creates a perfect opportunity to build up your credit score. As long as your account stays in good standing, you can show lenders you can responsibly manage a loan, and you may qualify for better interest rates and terms in the future.

What to watch out for

While personal loans can be convenient when you’re in a sticky situation with your finances, you should always tread carefully when you’re taking on more debt. Here are some red flags to pay attention to before you take out a personal loan in Quebec:

• High interest rates. You may end up paying high interest rates on your personal loan if you have bad credit or you borrow from a predatory lender.
• Origination fees and other charges. Between origination fees, administrative fees, prepayment fees, late fees and other charges, make sure you double check your contract so you’re aware of all the additional charges that may crop up with your loan.
• Large debt load. You may end up not being able to pay back the money you owe if you lose your job or run into unexpected costs that derail your budget.

If you do decide to take out a personal loan, it’s important to borrow only as much as you’ll be able to repay and to budget your repayments accordingly. If you default on your loan or the loan goes into collections, you’ll receive a negative mark on your credit score that can stay there for up to six or seven years. Make sure to use a licensed lender and budget for the amount of money you plan to take out.

Can I get personal loan in Quebec with bad credit?

Yes. Don’t be dissuaded if you have bad credit or no credit at all because you can still qualify for bad credit loans in Quebec. Your best bet to secure a bad credit personal loan in Quebec is through online lenders.

Simply apply online, providing information such as your employment history and income, and you should get a decision within the same day. Because you have bad credit or no credit history at all, these lenders will shift the focus to your monthly income and existing debts to determine if you can manage loan repayments.

Some online providers accept borrowers with credit scores that are as low as 300 to 550. They include Loans Canada and LoanConnect.

Keep in mind, these bad credit loans will come with higher interest rates. Be sure to compare rates, broker fees and admin fees before agreeing to a bad credit loan in Quebec.

Can I get a no credit check loan in Quebec?

Yes, but it’s not common since most personal loan lenders in Quebec will run a credit check to evaluate your ability to repay the loan. Lenders often use your credit score to help determine your loan’s features like term length, interest rate and the type of loan you qualify for. While some legit lenders offer no credit check loans, watch out for predatory or unlicensed lenders who often offer these types of loans as well.

If you’re worried about your credit score, a good option is to look into a lender that relies on a soft credit check since it doesn’t affect your credit score and takes less than a minute to complete. Many lenders are willing to work with bad- or poor-credit customers, so it won’t necessarily get you rejected.

Online broker LoanConnect, for example, can show you lender matches without affecting your credit score. Once you choose a lender, that lender will do a soft credit check. If the lender requires the extra step of a hard credit check, it will ask for your consent before proceeding.

How to apply for an installment loan in Quebec

You can apply for a personal loan online or at your nearest financial institution.

To complete your application successfully, you will need to submit some basic information such as:

• Personal details, including your name, date of birth, housing situation and a valid form of ID
• Contact details, such as your address, email address and phone number
• Details about your employment and income

How long does it take to get approved for installment loans in Quebec?

Depending on the lender, you may be able to receive your loan as soon as the next business day if you apply online. Some lenders may even be able to get you your money the same day, while banks and credit unions may take a few days up to a few weeks to approve and transfer your loan funds.

How can I tell if a lender in Quebec is legit?

Look for the following signs to make sure you’re working with a legitimate lender.

• The lender displays a Quebec licence number. Private lenders should be licensed by the province and display their licence number online and at all on-site locations.
• It provides contracts in the language you use to speak with your lender. Your lender should only provide contracts in a language that you speak fluently.
• It follows rate and fee regulations. Stay away from lenders that charge more than 60% interest on loans, and be sure to compare three to four providers to find the best deal.

Why choose a personal loan in Quebec over other financing alternatives?

When you’re in a financial bind, it’s a relief to know that you have options in Quebec to help you secure funding, such as home equity loans, lines of credit, credit cards and other alternative ways to source financing. Personal loans have their perks, though. If you’re on the fence, here’s a look at some key reasons to opt for a personal loan over other financing options.

• Lower interest rates. If you’re using a credit card to deal with a financial emergency or to make a large-scale purchase and you don’t have the funds to pay it all off, you could be committing to significantly high interest rates. This cost will drive up the price tag of whatever it is you’re buying. Personal loans tend to come with much lower interest rates.
• Long repayment terms. Personal loans in Quebec often come with repayment terms that are as short as 6 months up to 10 years. You can work with your lender to set the amount of time you’ll have to repay your loan. For this reason, personal loans are much more flexible compared to payday loans and credit cards, in which you may be making payments in a much more condensed period of time.
• Unsecured lending. If you don’t want to put your home, car or other assets on the line, unsecured personal loans are your best bet, especially compared to home equity lines of credit that let you borrow against the equity you’ve built in your home. If you default on your loan, you won’t put any of your assets in jeopardy.
• Processing time. With the rise of online lenders providing personal loans to Quebec residents, you may find it much easier to qualify for and receive funding for a personal loan, especially compared to home equity loans, credit union loans and small business loans. These loans tend to require more paperwork and more time to consider your application, while some lenders provide instant decisions on personal loans with funds released on the same day.

Personal loan alternatives in Quebec

If you’re not sure you want to take out a personal loan, you have other options. Here are some programs you might want to check out.

Quebec assistance programs

Quebec has some programs that can help lower the costs of everyday expenses for some residents and newcomers who are struggling to make ends meet.

• Social Assistance provides last-resort financial assistance to individuals who do not have a severely limited capacity for employment and who are unable to provide for their basic needs because of their financial situation.
• Child Assistance payment provides low-income families with financial assistance to cover expenses like medical bills, food, rent and utility bills.
• Resettlement Assistance Program provides financial assistance to refugees and protected persons for accommodation, essential clothing, household effects and living expenses.
• Disability Income Support helps people with disabilities in financial need to pay for living expenses, like food and housing.

Credit counselling

If you seem to be paying off your debts using more debt, or you can’t get your head above water, it might be time to enrol in a credit counselling program. These not-for-profit programs are designed to help low-income residents stay afloat, while managing and consolidating their debts.

Bottom line

If you want to make a large purchase or consolidate your debts, taking out a personal loan might be a possible solution. Be sure to compare lenders and familiarize yourself with the laws of Quebec to make sure you’re getting the best terms for your loan, and pay back your loan on time to avoid paying additional fees or interest.

Have more questions about personal loans in Quebec?

• How do I get fast approval on a personal loan in Quebec?

  The quickest way to get approved for a personal loan in Quebec is via online lenders that provide nearly instant loans in Quebec. With the application process done completely online, and often in less than 10 minutes, the online lending marketplace tends to be the fastest with issuing personal loans. Most even say they will provide a decision on your loan application in as little as 15 minutes to a few hours. Compare online lenders.

  If you're approved and you're happy with the terms and rates you've qualified for, you can sign loan documents electronically, and your lender can release the funds directly to your bank account within minutes to the next business day.

  If you decide to apply for a loan with a bank or a credit union, the process may involve more paperwork, even if you're a long-time client.

• How do I get short-term loans in Quebec?

  If you're in the market for a short-term loan in Quebec, you can apply to online lenders. Short-term loans come with terms that are about 3, 6 or 12 months long, instead of the conventional lengthier terms that start at 2 or 3 years.

• Can I get a payday loan in Quebec?

  Payday loans are not explicitly banned in Quebec, but lenders in Quebec cannot charge more than 35% annual interest.

• What can I use personal loans for in Quebec?

  You can use a personal loan for many purposes, such as consolidating debts, paying for a home renovation, buying a car or dealing with an emergency medical bill.

• Can I get a personal loan in Quebec if I'm unemployed?

  You could, although it'll depend on the lender and you'll need some form of income. You might be able to get approved for an installment loan if you receive a pension, disability, social security or other government benefits because many lenders consider these to be a type of regular income. You will have more trouble securing a loan if you don't have any money coming in at all.

• Can a lender have me arrested if I don't repay the loan?

  No. Lenders in Canada are legally prohibited from arresting you for unpaid debt. Lenders can sue for damages if you don't repay your loan, but this won't result in your arrest.

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Carmen Chai

Carmen Chai is a freelance writer at Finder, specializing in financial products. She is an award-winning Canadian journalist who has lived and reported from major cities such as Vancouver, Toronto, London and Paris. She has reported on personal finance, mortgages, and banking products for nearly a decade.

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