Unsecured Loans Canada: Let’s Compare
Agree, it would be great if you never had to take a loan. It’s wonderful when the salary is paid on time, and you don’t have to turn to friends or relatives and make them propose borrowing money. But from time to time, each of us finds ourselves in an uncomfortable situation. In this case, a personal loan can be the safest and least costly way to cover financial needs.
Unsecured loans in Canada allow borrowers to borrow a certain amount of cash without having to post collateral for collateral. If you choose this type of loan, then you do not risk losing the asset if you do not meet your payments.
But even this method has its drawbacks. Therefore, we have prepared this article for you so that you understand the topic better and can draw conclusions for yourself.
Best Unsecured Personal Loans in Canada
We have prepared for you a selection of the best lenders who provide unsecured personal loans. We evaluated them by whether they offered pre-qualification or not. It was also important for us to know what annual interest rates and loan amount the lenders provide to their clients.
Some financial institutions can provide you with funding the same day after your application is approved, while others may take several days. And the last significant factor is customer reviews. We have selected only the best lenders for you with good loan experience.
Loans Canada is the best deal for those borrowers who have a bad credit history. This online broker works with over 60 lenders, so you’ll always have the right loan terms for you. LC saves you time and sends your application for you.
Loan terms vary from 4 to 60 months. You can take out a loan ranging from $300 to $50,000. The annual interest rate depends on the term of the loan and your credit history.
You can get a personal loan offer that will have 5.4%, and you can get a maximum of 46.96% if you do not have a good credit score. All borrowers are required to have a steady source of income to qualify to apply. LC has been operating in the unsecured loans market since 2012.
The organization is a member of the Canadian Association of Creditors and is accredited by the BBB with an A+ rating.
Loan Away provides unsecured personal loans for clients with good or bad credit. You can also take out personal loans secured by housing or installment loans. The company serves borrowers from British Columbia, Ontario, Alberta and Newfoundland. Loan Away services are very fast – application approval usually comes in 30 minutes.
And all you need to do to get a positive answer is to prove that you are working with a stable income sufficient to cover the loan payments.
Unsecured personal loans are available to borrowers in the amount of $1,000–$5,000. The minimum loan term is 6 months. The maximum loan term is 36 months. The loan rate can be at least 19.90% if the borrower has an excellent credit history.
For lenders with poor credit ratings, the annual percentage can be as high as 45.90%. The penalty system may also apply, like late payment fee, potential prepayment penalty, NSF fee.
SkyCap offers swift approval and funding times for unsecured personal loan. What’s more, the customer service is professional and efficient. The company has existed in the financial market since 2013.
SkyCap is BBB accredited with an A+ rating. In 2022, the company was a finalist for the Canadian Association of Creditors’ Consumer Lender of the Year award. SkyCap customers get access to a free personal finance course.
SkyCap rates start at 19.99%, which is lower than most alternative lenders that offer personal loans. Lenders with poor credit score will, unfortunately, have a high annual percentage rate of 39.99%.
You can apply for a personal loan in the amount of $500 to $15,000 for a period of 9 to 60 months. SkyCap also requires borrowers to have a minimum monthly income of $1,666, full-time employment, or a pension.
goPeer is a Canadian-regulated P2P online lending platform. Your loan will be funded anonymously by regular Canadians. goPeer offers a competitive interest rate compared to banks and alternative lenders.
You can apply for an unsecured personal loan at a minimum APR of 8%. Such a low percentage is due to the fact that the company provides loans without the same costs, such as rent, staff and other costs associated with personal service.
The loan amount you can qualify for as a borrower varies from $1,000 to $25,000. The loan term is 36 – 60 months. goPeer requires borrowers to have an income of $40,000 per year and no credit card debt on a payday loan when applying for a loan application. Minimum credit score: 650. The average rate that customers pay is 15.9%.
Cash Money offers personal payday loans, installment loans and lines of credit to borrowers who are not eligible for a loan from a bank or credit unions. The company has been on the market for 30 years. The rating from the Better Business Bureau (BBB) is A+
When you apply for a personal loan, you need to provide proof of stable income and have a minimum credit score of 560 for cash installment loans. You can also apply online for a cash loan, at a local store, or by phone.
Cash Money makes it possible to get a loan from 100 to 10,000 dollars for a period of 6 to 60 months, depending on the income of the borrower. Funding can be received by Interac wire transfer, direct deposit or prepaid debit card. You can also repay an unsecured personal loan in full without any penalties or early repayment fees.
Spring Financial offers fast approval for unsecured personal loans and financing to borrowers who are not eligible for a bank loan. The borrower needs to have a minimum monthly income of $1,800 and should have been employed for the past three months.
Spring Financial operates entirely online. The application is submitted online or by phone. Spring does not have a system of fines.
Spring Financial issues personal loans ranging from $500 to $35,000 to cover any expenses. For example, paying tuition or bills, repairing and buying household appliances. You can fix the term from 6 to 60 months to reduce monthly payments.
A longer term will entail higher interest debt. Annual interest rates on personal loans start at 9.99% to 46.96%, which is higher than traditional lenders’ rates. You can also get loan insurance in case of death, illness, or job loss.
Lendful is an alternative to conventional lenders created by a fintech company in British Columbia in 2015. The company provides an opportunity to fill out a loan application at any time of the day without leaving home.
Lendful offers unsecured personal loans ranging from $5,000 to $35,000 with maturities ranging from 6 months to 60 months and annual interest rates from 9.9%.
Because these loans are unsecured, borrowers do not need to provide collateral to the lender in order to approve a loan application. All loans are credited to the borrower’s bank account within 24 hours.
Unfortunately, lending services from Lendful come with fees. Especially if you are late on your monthly payment or have insufficient funds, then other applicable fees will apply to you. This lender also has high interest rates for those borrowers who have a low credit score, low income or want to take out a loan for a short period.
Mogo stands out for its unique unsecured personal loan offer. You will be offered a trial period, which allows you to repay the loan amount within 100 days and return the interest and fees paid.
This is the only lender that proposes borrowing money and saves financial situation if you change your mind about a loan. The exception is loans for bad credit history.
The annual interest rate starts at 9.9% for borrower with good credit score. The maximum rate is 47% for poor credit history. The loan amount varies from $200 to $35,000 for a period of 6 to 60 months. The lender is required to have a minimum annual income of $13,000.
Unsecured Personal Loans in Canada: Let’s Sum Up
To summarize the information, we prepared a comparative table. It contains basic information on creditors.
|Lander||Interest rate||Loan Amount||Repayment Terms||Credit score|
|Loans Canada||from 5.4% to 46.96%||$300 – $50,000||from 4 to 60 months||300|
|LoanAway||from 19.90% to 45.90%||$1,000 – $5,000||from 6 to 36 months||300|
|SkyCap||from 19.99% to 39.99%||$500 – $15,000||from 9 to 60 months||575|
|goPeer||from 8% to 34%||$1,000 – $25,000||from 36 to 60 months||650|
|CashMoney||Varies by province||$500 – $10,000||from 6 to 60 months||560|
|Spring||from 9.99% to 46.96%||$500 – $35,000||from 9 to 48 months||500|
|Lendful||9.9%+||$5,000 – $35,000||from 6 to 60 months||640|
|Mogo||from 9.9% to 46.96%||$200 – $35,000||from 6 to 60 months||500|
Best Installment Loans in Canada
Installment loans are popular unsecured personal loans that can be found on the Internet. They have softer eligibility criteria than personal loans. Therefore, even alternative lenders without good credit scores can get their application approved. However, you will have to pay interest rates that are higher.
However, if you have unpaid expenses, then installment loans will quickly help you out. We have prepared for you a list of the best alternative lenders who provide personal loans in installments. We compared them and gave you a brief overview, so you can find the best deal for you.
SkyCap is an online lender that has been on the lending market since 2013. You can use it as an alternative to banks and credit unions even if you have a bad credit score. SkyCap is more interested in your employment and income than your credit history. It also has a high rating from the Better Business Bureau (BBB)
The starting annual interest rate in SkyCap for installment loans starts at 19.99%. If your credit history is not perfect, then this type of loan will suit you. You can borrow from $500 to $15,000.
The terms of personal lending vary from a minimum of 9 months to a maximum of 60 months. The annual interest rate depends on the income, payment ability of the client and other factors. The maximum you can get is 39.99%. You can also repay the loan early without penalty.
As we noted earlier, Loans Canada is a young organization with 10 years of history. LC is not a direct lender. It is an online platform that connects borrowers and lenders across the country. It currently specializes in finding suitable lenders for every Canadian with poor credit score, poor credit history, and in bankruptcy.
The lending conditions for installment loans are the same as for unsecured loans. The company will contact a network of lenders for you and select a suitable offer for you. It doesn’t matter what your credit history or income level is. LC allows borrowers to rate and view lenders. This allows you to weed out those who have a bad reputation.
FlexMoney is one of the most convenient and fastest lenders in Canada and alternative for credit unions. You can apply even if you do not have a permanent job or income from work. You just need to confirm that you have at least $2,000 in net income every month. After signing the personal loan agreement, the money goes to your bank account within 24 hours.
As for the loan amount and the annual rate, they depend on your credit history and other conditions. You can take out a personal loan in the amount of $500. The loan term can be 6 months or up to 60 months. An annual percentage from 18.90% to 46.93%.
We have already mentioned Mogo in our article. It offers a variety of loan, spending, and investment options, as well as the ability to track your credit score. More than 1.6 million Canadians use Mogo services.
No matter what your credit score is, you can still apply for a personal or installment loan. You will receive approval of your application within 1-2 business days.
You can take advantage of free credit tracking for 90 days. Or repay the principal amount of the loan within 100 days with all interest and commissions. Unfortunately, this is not available for MogoLiquid credits.
Loanz provides online installment loans for people with good or bad credit. It is owned by Consumer Genius Inc., which also includes other lending companies such as CarsFast and LendingArch.
Loanz makes it easy for you to apply for a personal loan and get a fast response. After confirming your application form and signing the personal loan agreement, the money will be transferred to your account within 15 minutes.
To qualify for most personal loans, you must have a minimum credit score of 579, a minimum monthly income of $1,200, and at least 3 months of work experience. Unfortunately, under any conditions, the annual interest rate starts at 29.90%, which is a very high figure.
For borrowers with bad credit history, the rate can rise to 46.90%. A personal loan is issued for a period of 12 to 60 months. You can borrow 1,000 – 15,000 US dollars.
Fairstone serves its clients throughout Canada except for Nunavut and has been in the personal loan market since 1923. The company’s portfolio includes many services: unsecured loan as well as secured loan, debt consolidation loans, and installment loans.
You can submit a no-obligation loan application that won’t affect your credit score and get approved in just one day.
As for installment borrows, you can take out a personal loan for amounts ranging from $500 to $25,000. The loan term can be from 6 to 60 months. The annual interest rate depends on your credit history and is quite high compared to other lenders. This starts at 26.99% and can go as high as 39.99%.
As a borrower, you are required to be able to make monthly payments into the loan account. Fairstone personal loans work in such a way that they can have the potential for additional fees.
Installment Loans in Canada: Let’s Sum Up
We have collected basic information about installment loans lenders. This table will help you choose the option that is right for you.
|Lander||Interest rate||Loan Amount||Repayment Terms||Credit score|
|SkyCap||from 19.99% to 39.99%||$500 – $15,000||from 9 to 60 months||660|
|Loans Canada||from 5.4% to 46.96%||$300 – $50,000||from 4 to 60 months||300|
|FlexMoney||from 18.90% to 46.93%||$500 – $15,000||from 6 to 60 months||500|
|Mogo||from 9.9% to 46.96%||$200 – $35,000||from 6 to 60 months||500|
|Loanz||from 29.90% to 46.90%||$1,000 – $15,000||from 12 to 60 months||570|
|Fairstone||from 26.99% to 39.99%||$500 – $25,000||from 6 to 60 months||660|
Best Payday Loans in Canada
Payday loans are personal loans work in order to help you out when your salary is delayed, or you don’t have enough money for emergency needs. However, you always need to be sure that your next pay cheque will be big enough to cover the entire cost of your payday loan.
Getting such a personal loan is simple because it does not matter what your credit history is. All you need to do is provide a stable income statement, a checking account, and proof of address. Payday courts are speedy – applications are approved within a day maximum.
We have selected for you the best lenders who provide payday loans. We analyzed their speed, availability, and reputation. But do not forget that such personal loans have very high interest rates and short repayment periods. Therefore, such alternative lenders are not suitable for everyone.
Cash Money helps meet short-term financial requirements and has been in business since 1992. In addition to an unsecured loan and consumer loans, it offers payday loans, as well as lines of credit and installment loans.
Credit can be taken online and in the store. Several payment methods are available: wire transfer, direct deposit and cash.
Borrowers are required to file a tax deduction for children, unemployment, disability, and a $1,000 minimum monthly wage report. You can take the loan payments in the amount of $100. Loan terms are very short – only from 5 to 40 days. The annual interest rate depends on the province, but in any case, it is very high since this is a payday loan.
iCASH provides short-term personal loans that can be applied for online. The repayment terms are very flexible, and there is a possibility of getting cashback. You can take out a personal loan, in addition to consumer loans, in the amount of $100 to $1,500.
The loan term is very short – from 7 to 62 days. The annual interest rate varies by province. You are required to have a minimum monthly income of $800.
There are various sources of income: social assistance, ODSP, child tax, AISH, CPP, provincial disability, OAS and employment insurance. The advantage of iCASH is electronic transfers in a few minutes and a free application. The support service works around the clock.
GoDay is based in Toronto and is located in Toronto and first started operations in 2012. In addition to personal loans and unsecured loans, Canadians can get payday borrows on the day they apply if they use online services. It offers payday credits the same day you apply online.
The company does not provide services in person, despite having several offices throughout Canada. GoDay has several payment methods available: direct deposit and wire transfers.
The company also accepts applications where government assistance is listed as the income of the borrower. You can apply for a personal loan when you don’t have enough money to pay your salary for up to 62 days.
The loan amount can be either $100 or $1500. You must have a regular source of income. The annual interest rate varies by province but is usually very high. In addition, you must have a direct deposit bank account.
Loan Express has been operating in the Canadian financial market since 2005 and offers unsecured personal loan and payday loan. The confirmation and loan agreement comes rapidly, and within five minutes, the money will go to your account. Loan Express has a mobile application through which it is convenient to track all transactions and payments.
You can receive your funds via bank transfer or wire transfer. The loan term is up to 62 days, and you can borrow from $100 to $1500 for your emergency expenses when you don’t have enough money to pay.
The annual interest rate depends on the province. You are required to submit an application stating a permanent source of income. This could be a pension, a disability, a child tax credit, most other regular government benefits, and just a regular job. You must also have a bank account to qualify for a personal loan.
Pay2Day is a payday lender that has been providing personal loans since 2006 and giving you cash when you visit one of its stores in British Columbia or Ontario. You can also apply online for a personal loan and receive an electronic transfer to your bank account within a few hours after signing the loan agreement.
The payday loan amount varies from $300 to $1,500. You can take out a loan for up to 62 days. The annual interest rate depends on the province.
You will be required to have a permanent source of income or retirement income if you want to be approved for a personal loan. Pay2Day guarantees you a refund within 48 hours if you change your mind. This credit institution has a mobile application through which it is convenient to track all transactions and every loan payment.
Speedy Cash is a payday lender that was founded in 1998 and has over 20 branches in Canada. In addition to providing payday loans and personal loans, it also offers online installment loans and checks cashing in all provinces except Quebec and PEI.
You can borrow money for your needs to take a personal loan in the amount of 250 to 1500 dollars for up to 62 days. All clients are required to have a regular source of income. The annual interest rate varies by province.
Like most payday lenders, it has a mobile application through which it is convenient to track all transactions and every loan payment.
Speedy Cash does not check the creditworthiness of its borrowers and accepts government aid as income. But, it is worth noting that the company calls employers to confirm employment details.
Payday Loans in Canada: Let’s Sum Up
We have collected basic information about lenders who provide payday loans. Most of them have no minimum credit requirements, so your choice becomes a little easier.
|Lander||Interest rate||Loan Amount||Repayment Terms||Credit score|
|Cash Money||Varies by province||$100 – $1,500||5 – 40 days||560|
|iCASH||Varies by province||$100 – $1,500||7 – 62 days||–|
|GoDay||Varies by province||$100 – $1,500||up to 62 days||–|
|Loan Express||Varies by province||$100 – $1,500||up to 62 days||–|
|Pay2Day||Varies by province||$300 – $1,500||up to 62 days||–|
|Speedy Cash||Varies by province||$250 – $1,500||up to 62 days||670|
What Unsecured Loans Are
An unsecured personal loan is a type of loan that does not require any collateral from the borrower. They are also called signed borrows. Lenders approve an unsecured personal loan based on the creditworthiness of the borrower. This allows them not to target the borrower’s assets as collateral.
Unsecured personal loans can be student credits and credit cards. As lenders take on more risk, they may charge higher interest rates and require a good or excellent credit score.
Since the lender has no collateral, if the borrower stops making every loan payment or defaults on an unsecured personal loan, the first one cannot receive anything as repayment. From this and such strict conditions for lending.
Example of Calculating Interest Rates of Unsecured Loans
Most personal loans are unsecured. Unsecured loans usually carry a higher interest rate to reflect the extra risk the lender takes on when they take out a personal loan. Since the interest rate for unsecured loans is always higher, you need to use a calculator.
It will help you figure out the correct amount. You need to collect the disclosure requirements in accordance with Regulation Z and prepare information about the calculation of interest on closed personal credits.
Typically, lenders use one of three methods to calculate interest on a personal loan: simple, compound, or incremental. It is enough for the borrower to know a simple method.
The distinguishing feature of simple interest is that the interest rate is always applied only to the principal amount. If you use simple interest and make monthly payments on time, the loan amount will decrease over time.
If you make early payments or make additional payments, then you will pay less interest. In this case, the personal loan will be repaid ahead of schedule. If you pay late, the amount of the payment related to interest increases. As a result, each payment applied to the principal amount of the debt is reduced.
Pros and Cons of Unsecured Loans
An unsecured personal loan is a good personal loan payments option for those who don’t want to pay a deposit and want to get their money back as quickly as possible. Unfortunately, this option is not a panacea and has its weaknesses and shortcomings.
Therefore, we have compiled a list of the advantages and disadvantages of unsecured personal loans for you.
- Simple to use. It usually takes a few minutes to apply for an unsecured loan. More often than not, you can simply fill out an application online and submit it for a credit check.
- No asset requirements. There is no need to collateralize the unsecured loan or risk losing an asset if you miss your monthly payment or fail to repay the unsecured loan.
- The unsecured loan amount is flexible. The amount you can borrow does not depend on your assets. You can get more money from a lender with an unsecured personal loan.
- Use funds for whatever you want. You can spend money on any purchases. No one requires you to report.
- Higher interest rates than secured loans. This situation arises because the lender is at great risk if you stop making loan payments.
- Difficult to qualify with bad credit. It may be harder for you to qualify for an unsecured loan if you have bad credit.
- Credit rating damage in case of default. Your credit score will deteriorate significantly if you don’t make your payments on time.
- Late payment fees. Many lenders have a system of late payment fees, which fines unscrupulous borrowers.
How to Get an Unsecured Personal Loan?
Getting an unsecured personal loan is very difficult even if you have experience with secured loans. But the procedure is easier if you prepare for it. The most important thing that interests lenders is the creditworthiness of the client. However, this is not the only item on their list. Prepare step by step to apply using our instructions.
- Check your credit score. To qualify for an unsecured loan, you basically need to have a credit score of 650 or higher. If your score is below this, do your best to improve it before applying for a personal loan.
- Source of income. Lenders want to know where you get the money to make your monthly payment. Therefore, you must prepare documents confirming a regular and stable income.
- Payment history. Lenders will definitely review your previous payment history.
- Co-signer. Using a guarantor is not a common process used by unsecured financial lenders, but it can make it easier to pay off a personal loan. The surety provides a personal loan agreement to pay off the higher interest debt if you fail to meet your obligations. This can positively affect the relationship with the creditor.
- Identity documents. You must verify your age. When you apply, you will need to provide a government-issued ID and proof of income.
Can I Get Unsecured Loan In Canada With Bad Credit?
Canadians may qualify for unsecured personal loans with poor credit history and ratings, although lenders prefer reputable clients. Unsecured installment loans and payday loans are also available to you if your score is below 660. But you have to accept that the interest rate will be very high.
You can also qualify for alternative unsecured loans for bad credit. These include prepaid credit cards or co-signed borrows. Nevertheless, you usually get higher interest rates if you apply for secured loan products. For instance, secured loans products include mortgages or lines of credit.
The procedure for applying for a personal loan with bad credit is the same as if everything was perfect. But it is better to enlist the help of a guarantor in order to increase your chances of a positive response from the lender.
Factors to Compare While Choosing Unsecured Loans in Canada
Choosing an unsecured personal loan is no easy task. An unsecured loan is most suitable for those who want to get money instantly and easily. However, it is very easy to get lost in the lists of the best lenders in Canada.
Every year their number is constantly growing. Everyone is trying to issue a personal loan under the best conditions. But borrowers also need to try to be able to make monthly payments and qualify for the best conditions.
That’s why we’ve put together a guide to help you find the right lender for your needs.
Decide for yourself how much you can afford and how much you want to borrow. Find a compromise. Then proceed to study offers from lenders. Different lenders have different minimum and maximum personal loan amounts offered. You need to get in between.
One of the most important readings in an unsecured personal loan is the interest rate. This is the cost that includes various administration fees that you will pay to borrow a certain amount of money. The annual interest rate can be very high if your credit score is low.
Therefore, you need to compare the conditions of each lender before making a decision. Read the information on the site, ask the manager, order a pre-credit qualification.
The term of your personal loan will depend on how much you borrow. The longer your unsecured loan term, the lower monthly payments you will have to make, but the total personal loan amount will be higher.
Interest rates are not the only important criterion when calculating the amount of a personal loan. You also have to look at commissions and other applicable fees. Some payday lenders include processing fees, late fees, reversal fees, administration fees, check return fees, and service taxes in the contract for each personal loan service they provide.
The most important of these is the processing fee. It ranges from 1% to 3%.
The last thing you need to pay attention to is the term of payment. This can be a monthly payment, bi-weekly payment, weekly payment, or semi-monthly payment. Bi-weekly payment is the least common. Choose what works best for your payment schedule.
Unsecured vs Secured Loans
The most significant difference between the two types is the deposit. Its presence or absence affects the chances of personal loan approval, rates and fees. Late payment of an unsecured personal loan can lead to a bad credit history.
A secured personal loan is used for larger purchases, as well as mortgages and car purchases. In such a personal loan, the interest rate is lower.
To make it easier to navigate their differences, we have compiled a comparative table:
|Unsecured Loan||Secured Loan|
|Not protected by an asset||Protected by an asset|
|No use of collateral||Use of collateral|
|Has a lower risk, but interest is higher||Has more risk because of the borrow’s assets|
|The amount of an unsecured loan is much lower||The amount of a secured loan is much higher|
Before taking out any loan or secured loans or unsecured loan, make sure you have a plan for how to repay them. After all, rash actions can lead to the fact that you are mired in credit card debt. Also, make sure that you are satisfied with the repayment terms.
Don’t rush into making a decision. Whether you decide to take out a secured or unsecured personal loan, be sure to select a few lenders and compare them. This will greatly improve your credit history.
- What is the easiest unsecured loan to get in Canada?
The easiest types of loans to apply for are payday loans, car loans, and credit builder loans.
- What are unsecured loans?
The unsecured loan that does not require collateral and has high interest rates.
- How much can I get with unsecured loan in Canada?
Most often, unsecured loans are issued in amounts ranging from $200 to $35,000.
- What personal loan is better: secured or unsecured?
Secured personal loan often has a lower interest rate than unsecured ones, but require collateral from the borrower. An unsecured personal loan has high interest rates. Therefore, the choice always remains with the client – he chooses what is best.
- When to choose installment loan in Canada?
Choose an installment loan when you need to solve your small financial problems quickly.