Learn how easy it is to apply for personal loans in Canada, whether private loans can be a good source of fast cash, and which lenders are the best in Canada. We also break down the best personal loan interest rates in Canada and discuss secured vs. unsecured personal loans in Canada.
Even the most financially savvy individual can run into a situation where they need to borrow money, and in those cases, a personal loan is usually the least expensive way to bridge the gap between your financial needs and your cash on hand. Personal loans in Canada are offered by financial institutions to individuals. This includes banks, credit unions, and other financial companies, and have terms and conditions attached to them.

No two lenders are alike and there are a plethora of products out there to suit your unique situation. Some personal loans (called secured personal loans) must be guaranteed by collateral, while others (called unsecured personal loans) do not. Finding the best personal loan interest rates in Canada can feel a bit overwhelming, as the interest rates and terms of personal loans depend largely on your financial situation and the lender you choose. To help make the decision easier, we’ve scoured the market and come up with the best personal loan providers in Canada.

Current Personal Loan Interest Rates in Canada 

Here is a comparison chart of the best personal loan interest rates in Canada.

LenderMaximum Loan SizeInterest RatesFunding TimelineStand-Out Loan FeaturesMore Info
Loans Canada$50,000Starting at 5.15%As early as same daySubmit one application to get instantly matched with multiple offersLearn More
Loan Connect$50,000 4.6%-46.96%Same dayGet connected with multiple lenders in as little as 5 minutes. Learn More
Meridian$35,000As low as 5.15%2 daysIn person lenderLearn More
Borrowell$35,000Average 11%-12%1-2 daysOffers unsecured personal loans in as little as 48 hours.Learn More
Refresh Financial$25,0005.95%-29.95%24 hoursOffers cash secured personal loans to help you rebuild your credit scoreLearn More

Why Consider Getting a Personal Loan?

Personal loans are an excellent option to bridge the gap between your cash reserves and your needs during an emergency. While it’s not wise to take out a personal loan to cover your everyday spending, there are many valid reasons to obtain a personal loan in Canada. Here are some common ones:

  • You’re invited to your best friend’s dream destination wedding
  • You have credit card debt or payday loan debt that you’d like to pay off
  • You have emergency expenses like car repairs or veterinarian bills
  • Your home requires urgent repairs
  • You must unexpectedly replace your car

Why apply for a personal loan instead of charging unexpected expenses to your credit card? The answer comes down to interest rates. Personal loans, both secured and unsecured, tend to have dramatically lower interest rates than credit cards, which result in less interest paid on the debt over time.

For example, most of the lenders on our recommended lender list have interest rates as low as 5.5%, whereas the average credit card has an interest rate of between 19.99% – 29.99%. It is possible to get a low interest credit card with a rock bottom rate as low as 8.99%, but whenever possible, always choose the credit tool with the lower interest rate.

If you want to crunch the numbers before taking on a personal loan, try using our loan payoff calculator.

Comparison of the Low Interest Loans in Canada 

Before signing on the dotted line, here’s a break down of the top personal loan providers in Canada, and what makes them the best of the bunch.

Best Overall: Loans Canada

Minimum Credit Score: None
Minimum Income: Not specified

 loans_canada_210x100Established in 2012, Loans Canada works as a search platform to find the best personal loans for your needs. The company doesn’t lend money themselves, but rather uses proprietary lender-matching technology in order to find the most suitable loan for your specific requirements based on the information you’ve provided in your application as well as your location within the country. Loans Canada offers loans up to $50,000 and interest rates start as low as 5.15%. To be eligible to apply, you need to be the age of majority in your province, have proof of employment, and either be a Canadian citizen or permanent resident. Loans Canada is the largest lender network in Canada and has helped hundreds of thousands of Canadians receive loans since its establishment.

Learn more about Loans Canada.


Best For Fast Cash: Loan Connect

Minimum Credit Score: None
Minimum Income: Not specified

LoanConnect_210x100Loan Connect is a Canadian search engine for personal loans. Loan Connect does not lend money itself. Instead, it connects borrowers with local lenders. By filling out a single application, you’re connected with dozens of borrowers in as little as five minutes. Loan Connect offers both secured and unsecured loans to borrowers, which makes them a good place to start even if you have a lower credit score, bad credit, or a history of bankruptcy.

To apply for a personal loan through Loan Connect, you’ll need to be the age of majority in your province and be a Canadian citizen. When you apply for a loan through Loan Connect, you can expect an interest rate as low as 4.6%, but depending on your financial profile, the interest rate may be higher.

Learn more about Loan Connect.


Best In-Person Lender: Meridian

Minimum Credit Score: None
Minimum Income: Not specified

Meridian_210x100Meridian is the third-largest credit union in Canada and the largest credit union in Ontario. They offer a variety of savings, chequing, and investment tools, along with personal loans. If you prefer a lender with a physical presence, Meridian may be the right choice for you, as they have over 1,900 employees in over 90 branches across Canada.

Meridian offers both secured and unsecured personal loans in Canada up to $35,000, with interest rates as low as 5.15%. You can apply for Meridian’s personal loans online and know whether you’re approved in seconds. Applying for a personal loan through Meridian won’t impact your credit score.

Learn more about Meridian.


Best Low-Rate Unsecured Loan: Borrowell

Minimum Credit Score: 660
Minimum Income: $20,000

BBorrowell_210x100orrowell is a Canadian company that offers unsecured personal loans in as little as 48 hours. You can borrow up to $35,000 from Borrowell with loan terms between three and five years. The interest rates at Borrowell are as low as 5%, but average between 11-12% for most borrowers.

It’s important to note that Borrowell is not available for residents of Saskatchewan or Quebec, and you must have a credit score of at least 660 or higher to qualify.

When you take out a personal loan with Borrowell, you’ll pay a loan origination fee of between 1% and 5% of the loan amount. You don’t pay this fee upfront. Instead, it is added to your total loan amount. For example, if you borrowed $5,000 from Borrowell and the loan origination fee was 1%, your total loan amount would be $5,050.

Learn more about Borrowell.


Best Loan for Bad Credit: Refresh Financial

Minimum Credit Score: None
Minimum Income: None

Refresh Financial_210x100If you have bad credit, Refresh Financial offers cash secured personal loans to help you rebuild your credit score. How it works: you take out a loan, but instead of receiving the funds immediately, you must make all of your payments before the funds are released. You’ll pay an interest rate of between 5.95% and 29.95% during this time, but your payments are to credit bureaus, which will improve your credit score. You can borrow between $1,600 and $25,000, and the loan terms range from 36 to 60 months.

Since this is a cash-secured loan, you do not need a co-signer, and there is no minimum credit score requirement. Once you pay back your loan completely, your funds are released. At that point, you should have rebuilt your credit score enough to qualify for a traditional personal loan.

Learn more about Refresh Financial.


Best Bad Credit Personal Loans in Canada

Got bad credit? Don’t sweat it – there are options for personal loans in Canada. We’ve rounded up The Best Bad Credit Loans in Canada, but here are a few lenders on our list:

Best All-Round Lender: Meridian

Meridian is our top choice to obtain a personal loan or line of credit. For one, they’re the first financial institution in Canada to offer unsecured loans that you can get 100% online. Their all-digital application process means you’ll find out whether you are approved quickly from wherever you are. Your application may be processed in mere minutes, and there’s no impact on your credit score.  You’ll also get a quote immediately, so you can work towards becoming debt-free sooner.

Learn more about Meridian.


Best for Rebuilding Credit: Refresh Financial

Refresh Financial_210x100If you have bad credit that you need to rebuild, Refresh Financial is an excellent choice. Since their personal loans are secured and designed to help you rebuild your credit, you are virtually guaranteed approval, and their loan structure is designed to help you succeed in repaying your loan on time.

Learn more about Refresh Financial.


Best for Fast Cash: Loan Connect

LoanConnect_210x100

If you need fast access to credit, Loan Connect will put you in touch with potential lenders speedily, and a single application means the process is streamlined to help you get your money as quickly as the next day.

Learn more about Loan Connect.


Best For Guarantor Loans: LendingMate

Lending MateLendingMate offers loans for Canadians between 19 and 75 years of age, and they can lend to anybody — no matter what your credit score — as long as they are not bankrupt or in an active consumer proposal. All you need to do is provide a suitable guarantor. That means if a friend or family member trusts you will make payments on time, they can be your guarantor and you can borrow the money you need over a more flexible term. LendingMate has a 95% approval rate and you can borrow up to $10,000 within 24 hours.

Learn more about LendingMate

Unsecured vs. Secured Loans 

Not all personal loans are the same, and it’s important to understand the differences between types of personal loans before signing on the dotted line. Depending on your financial situation, you may qualify for one of the following types of personal loans.

Unsecured loan

An unsecured loan is an amount of credit that is extended to you by a lender, and you don’t have to “secure” the loan with anything like cash or an asset (such as a car or your home). An unsecured personal loan requires a certain level of trust between you and the lender since if you default on payments, they don’t have collateral to seize as payment. As a result, you’ll need a good credit score and debt-to-income ratio to qualify for an unsecured personal loan.

Secured Loan

A secured personal loan is an amount of credit that is extended to you by a lender, and an asset secures that amount. That asset could be your house, your car, or even cash. The main benefit of a secured line of credit is that the interest rate is slightly lower since your lender can seize your collateral if you default on payments. If you have a low credit score or a high debt-to-income ratio, you may only qualify for a secured personal loan.

Reverse Loan

A reverse loan is designed to help you rebuild your credit score. It works by requiring you to secure a loan with cash, and you’ll rebuild your credit score by making regular payments against the “loan.” A reverse loan lets you build credit and save money at the same time, but their interest rates can be higher than secured or unsecured loans.

Personal Loans vs. Private Lenders vs. Payday Loans

You may have also come across two additional types of loans in your research: private loans and payday loans. A private loan is similar to a personal loan, but instead of coming from a bank or credit union, it comes from a private institution or an individual. Private lenders usually operate by their own rules, and as a result, can approve loans very quickly – within a few days in most cases.

Payday loans offer similar quick access to cash, but the downside of a payday loan is that the interest rate can be very high. Payday loans have extremely short loan terms (for example, two weeks, or your next payday) and the amounts are small, usually up to $1,500. If you fail to pay back your payday loan, you’ll pay interest and fees, and you may get stuck in a cycle of debt.

How to Apply for a Loan in Canada?

In Canada, not everyone can qualify for a personal loan. Different types of loans (for example, secured vs. unsecured loans) have extra qualification requirements, but generally, you must meet all the criteria below to qualify for a personal loan:

  • Be the age of majority (18 or 19 depending on your province)
  • Live in Canada and be a resident
  • Have a bank account
  • Have a valid driver’s license, passport, or some other form of photo ID
  • Have proof that you live in Canada, for example, a utility bill with your name and address
  • Have proof of income (for example, pay stubs or letter or employment)
  • Have an itemized budget that tallies your regular monthly expenses like rent or mortgage payments, cell phone bills, and car payments
  • Have a credit score and a credit history

The conditions above are the minimum requirements to qualify for a loan in Canada, but if you want to qualify for the best available interest rates, you should also have a credit score of at least 650, little debt, and you can’t have filed for bankruptcy. If you don’t meet those three additional criteria, you can still get a personal loan, but you may be limited to the types of loans for which you’ll qualify.

Should You Get a Personal Loan?

No one wants to contemplate the idea of taking out an emergency personal loan, but if you’re considering it, the options we’ve outlined above are good choices to help you bridge the gap between your financial needs and means. Once you qualify for a loan and get the funds in your bank, make sure to focus on paying back the loan quickly and starting a savings account ASAP. That way, you’ll have cash ready to go for your next big expense.

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