The Best Personal Loans in Canada for 2025: A Complete Guide

Key Takeaways

• What is a Personal Loan? A flexible way to borrow money as a one-time lump sum, which you repay through fixed monthly payments over a set loan term.
• Who Is It For? Ideal for consolidating debt, financing major purchases like home renovations, or covering significant unexpected expenses.
• What to Expect: Loan amount options typically range from $500 to $50,000+, with an interest rate from 9.99% to 35%. Your final rate is highly dependent on your credit score.
• Where to Get One: Available from traditional banks, credit unions, and a growing number of online lenders. Banks often have stricter requirements, while online lenders may offer faster approval.

When a Personal Loan is a Good Choice

A personal loan can be a great option because it provides flexibility and lower rates compared to other borrowing options. You can use the funds to cover unexpected expenses, large purchases, or for debt consolidation purposes, making it a flexible and useful borrowing option.

Why Personal Loans May Be a Better Option Than Payday Loans

Personal loans are typically a better choice compared to payday loans because they offer lower interest rates and longer repayment terms, making them more affordable and easier to repay. Payday loans come with very high fees and short repayment terms, making them quite expensive and difficult to pay back by the due date.

Further, you’ll be more likely to get a higher loan amount with a personal amount compared to a payday loan. Personal loans can be made for upwards of $50,000, while payday loans typically cap out at $1,500.

Why Personal Loans May Be a Better Option Than Credit Cards

Personal loans generally feature lower interest rates than credit cards, making them a more cost-effective borrowing option. You’ll also get a lump sum of money upfront with a personal loan, which can be useful for covering large expenses. Further, personal loans feature a fixed repayment structure, unlike credit cards which can be difficult for undisciplined borrowers to manage payments, which can lead to an accumulation of high-interest balances.

Why Personal Loans May Be a Better Option Than Lines of Credit

Personal loans provide a lump sum of money upfront and a fixed repayment term, making them a more predictable financing option compared to credit lines, which have flexible credit limits, variable interest rates, and a relatively unstructured repayment plan. While lines of credit may be useful for those who need a financial backup when the need for extra funds arises, personal loans are more suitable for those who need a large sum of money to cover large expenses and prefer the stability of regular and consistent repayments.

When to Consider Other Options

This type of credit is not free money. You should pause and reconsider if:

• You're borrowing for discretionary spending you can't truly afford, like a luxury vacation.
• You don't have a stable income to comfortably manage the loan payments.
• You haven't addressed underlying spending habits that led to the debt in the first place.

Reviews of Top Canadian Personal Loan Lenders

Bree

• Best For: Covering a very small, one-time cash shortfall to avoid a costly bank overdraft (NSF) fee when you are just a few days away from your next paycheque.
• The Real Cost: The service itself is interest-free. The "cost" comes from two optional sources: users are encouraged to leave a "tip" for the service, and you must pay an "express fee" (e.g., $5.99) if you want the funds instantly. Declining both and waiting 1-3 business days makes the service truly free.
• The Word on the Street: Bree is widely praised on forums as a legitimate and effective way to save on a ~$45 NSF fee. The most common advice shared is to ignore the push to tip and to only pay the express fee if it's an absolute emergency, otherwise the free option is best. The main warning is against dependency, as using it monthly indicates a larger budgeting issue.
• The Bottom Line & Who It's For: Bree is an excellent tool for a very specific, minor financial timing issue. This service is for you if: You have a one-time need for less than $500 to prevent an overdraft fee and can either wait for the free transfer or the express fee is still cheaper than the bank fee. Avoid this service if: You need more than a few hundred dollars or if you find yourself needing it every month, as this points to a need for budgeting rather than a cash advance.

easyfinancial

• Who This Loan Is For: This loan is designed for Canadian residents with fair-to-poor credit who have been declined by traditional banks but need a significant amount of money ($500 - $100,000) for a critical purpose, such as consolidating high-interest credit card debt or covering a major, necessary expense. It is specifically a tool for non-prime borrowers who see the loan as a way to access funds and potentially rebuild their credit history.
• The Real Cost: This is a high-cost lending option. You can expect an Annual Percentage Rate (APR) between 29.99% and 46.96%. On a $10,000 loan, this can translate to thousands of dollars in interest per year. A common point of caution is the "optional" loan protection insurance, which will be offered during the application process and can significantly increase your monthly payment if it is not firmly declined.
• The Word on the Street: Based on discussions on forums like Reddit, users confirm that easyfinancial is one of the main players for those who can't get bank financing. Many have successfully used it to get back on their feet. However, the most consistent piece of feedback is the shock at how quickly interest accumulates. The most frequent warning shared is to be prepared for a persistent sales pitch for optional insurance and to say "no" to keep costs down.
• The Bottom Line: easyfinancial is a powerful but expensive tool that should be treated as a financial last resort, not a first choice. Its high-interest rates necessitate a disciplined and aggressive repayment strategy to be effective. If you have access to any cheaper form of credit, you should take it.

Fairstone Financial

• Best For: Homeowners with fair-to-poor credit who can use their home equity to secure a loan, thereby accessing lower interest rates than typical unsecured options.
• The Real Cost: Fairstone has two distinct cost structures. For unsecured loans, the APR is high, ranging from 26.99% to 39.99%, making it comparable to other high-cost lenders. For secured loans, the rates are significantly lower, starting at 19.99% APR. As with competitors, be mindful of optional loan insurance products that will be offered and can inflate your costs if accepted.
• The Word on the Street: Forum users frequently compare Fairstone directly to easyfinancial. The consensus is that their secured loans are a much better deal if you qualify. For unsecured loans, they are seen as largely interchangeable. The most common warning is to fully understand the implications of a secured loan: you are putting your home on the line, and defaulting could have severe consequences.
• The Bottom Line & Who It's For: Fairstone is a tale of two products. Its secured loan is a strategic option, while its unsecured loan is a last resort. This loan is for you if: You are a homeowner, have been rejected by banks, and are comfortable leveraging your home equity for a more manageable interest rate. Avoid this loan if: You are not a homeowner (as their unsecured rates are very high) or if you are uncomfortable with putting your home up as collateral.

Spring Financial

• Best For: Tech-savvy borrowers with fair-to-good credit who want a completely digital, branch-free application process for a standard personal loan.
• The Real Cost: The interest rates on their standard loans are high, starting at 9.99% but frequently extending up to 34.95% for most applicants. Their most discussed product, "The Foundation," is a credit-builder loan which requires you to make payments before receiving the funds. While this builds credit, the "cost" is the lack of immediate access to cash, which can be confusing for applicants looking for a traditional loan.
• The Word on the Street: Users praise the speed and convenience of the online platform. The most significant point of confusion found in online discussions revolves around "The Foundation" loan. Many users apply thinking they will get cash upfront, only to find they've signed up for a credit-building program. It's a recurring warning to read the terms carefully to ensure you're getting the product you need.
• The Bottom Line & Who It's For: Spring Financial offers a modern, digital experience but requires careful attention to its product offerings. This loan is for you if: You are applying for their standard instalment loan, value a quick online process, and are prepared for high-interest rates. Avoid this loan if: You need cash immediately and accidentally sign up for their credit-builder program, or if you are uncomfortable with a lender that has no physical branches.

Fora

• Best For: Users needing ongoing, flexible access to cash for unpredictable expenses (e.g., gig workers, contractors) rather than a single, fixed loan amount.
• The Real Cost: Fora offers a line of credit, not a loan. The interest rates are high, ranging from 19.9% to 34.9%, and you only pay interest on the amount you have actually withdrawn. The real risk is cost-over-time; because there's no fixed end date, carrying a balance for an extended period can become extremely expensive.
• The Word on the Street: Users who need to manage cash flow appreciate the flexibility. The most common warning is about the lack of structure. Without the discipline of fixed monthly payments aimed at a zero balance, many users find it easy to get stuck in a cycle of only paying interest while the principal remains, turning it into a very long-term and costly debt.
• The Bottom Line & Who It's For: Fora is a specialized tool for cash flow management, not a traditional debt repayment solution. This product is for you if: You are highly disciplined, need to borrow and repay funds on an irregular schedule, and can create your own aggressive repayment plan. Avoid this product if: You need the structure of a fixed-term loan to pay off debt or if you might be tempted to continually draw funds without paying down the principal balance.

Mogo Finance

• Best For: Users who want an all-in-one financial app that includes free credit score monitoring and identity fraud protection, and see a small loan as a secondary feature.
• The Real Cost: The loan product itself is expensive for what it offers. The APR is high at 34.37%, and the loan amounts are small, capping out at $5,000. There is no cost for their other features like credit score monitoring, which is their main draw.
• The Word on the Street: Most online discussions center on Mogo's app and its free credit score feature, which is well-regarded. The loan is often an afterthought. When it is discussed, users generally consider it too expensive and too small to be useful for significant financial needs, viewing it more as an emergency add-on than a core product.
• The Bottom Line & Who It's For: Mogo is more of a FinTech app with a loan feature than a dedicated lender. This loan is for you if: You are already using the Mogo app for its other features and need a very small amount of money for a short-term emergency. Avoid this loan if: Your primary goal is to find the most cost-effective loan for a significant expense. Better rates and larger amounts are available elsewhere.

Money Mart / Cash Money

• Best For: Individuals needing immediate access to cash in hand from a physical, brick-and-mortar location, often outside of standard banking hours.
• The Real Cost: The cost is extremely high. While they offer larger instalment loans with rates up to 34.28%, they are infamous for their payday-style loans. The fees for these short-term products, when calculated as an Annual Percentage Rate (APR), often exceed 300-400%.
• The Word on the Street: Users acknowledge the undeniable convenience of getting cash instantly. However, these brands are consistently described as a "debt trap." Users warn that the ease of getting a small loan can lead to a dangerous cycle of re-borrowing to cover the repayment of the previous loan plus the exorbitant fees.
• The Bottom Line & Who It's For: These are high-convenience, extremely high-cost lenders of last resort. This service is for you if: You have a dire, time-sensitive emergency, have exhausted every other possible option (including family, friends, and credit cards), and need physical cash right now. Avoid this service if: At all possible. The cost is almost never worth the convenience and the risk of getting caught in a debt cycle is incredibly high.

Nyble

• Best For: Individuals with no credit history who want an easy way to establish a payment record with the credit bureaus, with the cash advance feature being a secondary benefit.
• The Real Cost: The basic cash advance service is free, but standard delivery takes up to 3 days. To get funds instantly (within 30 minutes), you must upgrade to a paid membership for a monthly fee (e.g., $11.99/month). The primary "cost" is this subscription if you require speed.
• The Word on the Street: Users see Nyble primarily as a credit-building tool, and it is well-regarded for that purpose. The cash advance is seen as a small, secondary perk. The subscription model is the main point of contention; users advise that if you just need an occasional advance, the subscription is more expensive than a one-time fee from a competitor like Bree.
• The Bottom Line & Who It's For: Nyble is a credit-builder first and a cash advance service second. This service is for you if: Your main goal is to build or repair your credit score, and you see the small cash advance as a minor bonus feature. Avoid this service if: Your only need is a quick cash advance, as the mandatory subscription for instant access is not cost-effective for one-off use.

How to Apply for a Personal Loan in Canada: A Step-by-Step Guide

Applying for a personal loan in Canada involves several steps, including meeting eligibility requirements, gathering necessary documentation, and submitting your application to a chosen lender.

Here's a breakdown of the process:

1. Check eligibility and prepare
   • Be the age of majority: You must be the age of majority in your province or territory of residence to be eligible for a personal loan.
   • Be a Canadian resident: You'll need to demonstrate proof of identity and Canadian residency.
   • Have an active bank account: Lenders will require your bank account details for depositing funds and scheduling repayments.
   • Have proof of steady income: Lenders assess your ability to repay the loan, so you'll need to provide evidence of regular income. This can include recent pay stubs, tax returns, or employment letters.
   • Be able to show proof of residence: A utility bill or rent receipt may suffice to demonstrate proof of your residence.
   • Have a credit score: Your credit score is a major factor in loan approval and interest rates. Lenders prefer applicants with a good credit score (typically 660 and above, according to NerdWallet).
   • Understand credit checks: Most lenders conduct a credit check as part of the application process. This helps them evaluate your ability to repay the loan.
2. Gather required documents While the exact documents may vary depending on the lender, generally you'll need:
   • Government-issued identification: Valid photo ID such as a passport or driver's license.
   • Proof of income or employment: This could be recent pay stubs, tax returns (if self-employed), or an employment letter.
   • Proof of address: A utility bill, bank statement, or other document with your current address.
   • Bank account details: For depositing funds and setting up repayments.
3. Compare lenders and apply
   • Banks and Credit Unions: You can apply in person at a branch, or sometimes online or over the phone. Ensure you bring all required documents for in-person applications.
   • Online Lenders and Brokers: Many online lenders and loan brokers like Spring Financial, Loans Canada, and LoanConnect offer online applications, often with quicker processing times. You may be asked to upload scanned documents.
   • Bad credit options: If your credit score isn't ideal, alternative lenders like Spring Financial, LoanConnect, or easyfinancial may be an option, but be prepared for potentially higher interest rates.
4. Review loan agreement
   • If your application is approved, carefully review the loan agreement before signing. Pay close attention to the loan amount, interest rate (APR), term, and any additional fees, according to Canada.ca.

Personal Loan Terms You Can Expect In Canada

Before you decide if a personal loan is right for you, it's essential to understand the key characteristics that define these financial products in the Canadian market. These three pillars—amount, interest rate, and term—will determine the cost and structure of your loan.

• Loan Amounts: How Much You Can Borrow The amount of money you can borrow with a personal loan varies significantly from one lender to another. At the lower end, you might find small loans starting around $500, designed for minor emergencies. On the higher end, major banks and some specialized lenders can offer amounts of $50,000, $100,000, or even more, particularly for borrowers with strong credit and high incomes. The final amount you're approved for will be a direct reflection of the lender's confidence in your ability to repay, based on your income, existing debt, and credit history.
• Interest Rates (APR): The True Cost of Borrowing The interest rate, often expressed as an Annual Percentage Rate (APR), is the primary cost of your loan. In Canada, personal loan interest rates occupy a middle ground; they are typically much lower than the 19.99% to 29.99% rates found on standard credit cards, but higher than the rates for loans secured by major assets, like a home equity line of credit (HELOC). You can expect to see rates ranging from as low as 9.99% for applicants with excellent credit at a major bank, to as high as 35% for those with poor credit histories using alternative lenders.
• Loan Term: Your Repayment Period The loan term is the length of time you have to pay back the loan. A common range for personal loan terms in Canada is between 24 and 60 months (2 to 5 years). However, this is flexible. Smaller loans may have terms as short as 6 or 12 months, while very large loans, especially for debt consolidation or home renovations, can have terms extending up to 7, 10, or more years to keep monthly payments manageable. Remember, a longer term means lower monthly payments, but you will pay more in total interest over the life of the loan.

Sources and Types of Personal Loans in Canada

Navigating the world of personal loans means understanding where to look and what types of loans are available. Your financial situation will largely dictate which path is best for you.

Where to Get a Personal Loan in Canada

You have three main sources for obtaining a personal loan in Canada, each with its own pros and cons:

• Major Banks and Credit Unions: Institutions like RBC, TD, Scotiabank, CIBC, BMO, and local credit unions are often the first stop for many. They typically offer the most competitive interest rates and highest loan amounts. However, they also have the strictest lending criteria. To get approved, you'll generally need a good to excellent credit score (typically 660+), stable employment, and a manageable level of existing debt. Credit unions may offer slightly more flexible terms to their members.
• Private and Alternative Lenders: This is a broad category of online-first lenders (like Fairstone Financial or Spring Financial) that specialize in serving borrowers who may not meet the strict requirements of major banks. They are often more open to applicants with lower credit scores, non-traditional income sources (like freelance or gig work), or higher debt-to-income ratios. The trade-off for this accessibility is a higher interest rate.
• Loan Brokers: A loan broker acts as a matchmaker. Instead of lending money themselves, they use your financial profile to shop around with their network of lenders to find you the best possible offer. This can save you time and potentially find you a better deal than you could on your own, especially if your credit situation is complex.

Understanding Secured vs. Unsecured Personal Loans

Personal loans primarily fall into two categories, defined by whether or not you pledge an asset as a guarantee.

• Unsecured Personal Loans This is the most common type of personal loan. It is granted based solely on your creditworthiness—your credit score, income, and overall financial health. You are not required to provide any collateral.
  • Pros: Your personal assets (like your car or home) are not at risk if you default on the loan. The application process is often faster and simpler.
  • Cons: Because the lender is taking on more risk, unsecured loans typically have higher interest rates. It can also be more difficult to qualify, and you may be approved for a smaller loan amount, especially if you have bad credit. In some cases, a co-signer may be required to secure the loan.
• Secured Personal Loans A secured loan requires you to pledge a valuable asset as collateral. This could be the equity in your home or a paid-off vehicle. This collateral acts as a security blanket for the lender.
  • Pros: Because you are guaranteeing the loan with an asset, you represent a lower risk. This often results in a significantly lower interest rate, a higher approved loan amount, and a better chance of approval, even with a less-than-perfect credit history.
  • Cons: This type of loan carries a major risk. If you are unable to make your payments and default on the loan, the lender has the legal right to seize and sell your asset to recoup their money.

How to Qualify for a Personal Loan in Canada

Qualifying for a personal loan involves more than just filling out a form. Lenders assess several key areas of your financial life to determine your eligibility and the terms of your offer. Here’s what they look at and what it means for you.

Getting a Personal Loan with a Bad Credit Score

Yes, it is possible. While major banks will likely decline an application with a credit score below 650, a large market of private and alternative lenders specializes in "bad credit loans." These lenders place less emphasis on your credit score and more on your current income and ability to make payments. Some may not even perform a credit check. However, be prepared for the trade-off: the interest rates for these loans are significantly higher to compensate the lender for the increased risk.

Qualifying for a Personal Loan with Low Income

A low income doesn't automatically disqualify you. Lenders are most concerned with your debt-to-income ratio—the percentage of your monthly income that goes toward paying debts. If you have low income but also very low debt, you may still be seen as a good candidate. Private lenders are often more flexible and may approve applicants with lower income levels or accept non-traditional income sources like government benefits (e.g., disability, pension) or gig economy work, as long as you can prove its consistency. The loan amount you're approved for will likely be smaller to ensure your payments are manageable relative to your income.

Getting an Emergency Personal Loan Quickly

When you need cash urgently, traditional banks are often too slow. This is where online lenders shine. Many alternative lenders offer streamlined online applications using Instant Bank Verification (IBV) to securely and instantly confirm your financial details. This technology allows for rapid decision-making, and it's common to receive approval within hours and have the funds deposited directly into your bank account via e-transfer on the same day or the next business day.

Standard Personal Loan Application Requirements

While every lender is slightly different, they almost all assess these core factors:

• Income and Employment: Lenders need to see that you have a consistent source of income to cover the loan payments. Most have a minimum monthly income threshold (e.g., $1,500/month) and prefer to see that you've been with your current employer for at least 3-6 months.
• Debt-to-Income (DTI) Ratio: This measures your ability to take on new debt. Lenders typically want to see a DTI of 44% or lower.
• Credit History and Score: Your credit report shows lenders how you've handled debt in the past. A history of on-time payments will result in a better interest rate, while missed payments or defaults will lead to higher rates or a decline.
• Collateral (for Secured Loans): If you apply for a secured loan, the lender will assess the value and ownership of the asset you plan to use as collateral.

Documents Required for a Personal Loan Application

To speed up the process, have these documents ready:

• Personal Identification: One or two pieces of valid government-issued ID (e.g., driver's license, passport).
• Proof of Income: Recent pay stubs, T4 slips, or letters of employment.
• Bank Account Information: A void cheque or pre-authorized debit form for setting up payments. Many online lenders now use a secure digital system called Instant Bank Verification (IBV), which allows them to view a read-only copy of your bank statements to verify your income and account details without you needing to upload any documents.
• Social Insurance Number (SIN): This is required for the lender to perform a credit check.

Your Personal Loan Borrowing Rights

As a borrower in Canada, you have certain rights when it comes to how you’re treated by lenders. In general, lenders are required to clearly stipulate the costs and terms of your loan. They also have limits in terms of how much they can charge you and restrictions on how they collect repayments. For instance, consider the following:

• Fee disclosures: Lenders must provide borrowers with details about all costs and loan terms, including interest rates, fees, and repayment schedules. This must be done before the borrower signs the loan contract.
• Fair payment collection practices: Lenders cannot harass borrowers when they attempt to collect unpaid dues. There are specific practices that lenders are allowed to use, and others that they are not.
• Right to cancel: Some loans allow borrowers to cancel their loan agreement within a certain period of time without penalties. This is known as the cooling-off period, and is usually around 48 hours after loan acceptance, depending on the province and the loan type.
• Interest rate limits: In Canada, the interest rate of a high-cost personal loan cannot exceed the criminal interest rate of 35% APR.

That said, you also have responsibilities when it comes to how you handle your loan. More specifically, you’re required to repay the loan as per the terms of your loan agreement. You also owe it to yourself to manage your debt responsibly so you don’t overleverage yourself and wind up spiralling in debt.

How to Spot and Avoid Predatory Loans and Scams in Canada

When you're looking for a loan, it's crucial to know the warning signs of predatory lenders and scams. A legitimate lender is professional and transparent; a scammer shows clear red flags. Here’s how to protect yourself.

1. The "Guaranteed Approval" Promise

No legitimate lender can guarantee loan approval without first assessing your finances. This promise is a major warning sign for either predatory interest rates or an outright scam.

2. Requests for an Upfront Fee

This is the number one sign of a loan scam. Legitimate lenders never ask you to send them money for "insurance," "processing," or "administration fees" before you receive your loan. Real fees are deducted from the loan proceeds, not paid by you in advance.

3. High-Pressure Tactics

If a lender pressures you to "sign now before the offer disappears," they are trying to stop you from reading the fine print. A reputable offer will always be valid for a reasonable amount of time, allowing you to review it properly.

4. No Credit Check (for a large loan)

While some small cash-advance apps may not do a hard credit check, any lender offering a significant personal loan without reviewing your credit is a major red flag. This indicates they are not following responsible lending practices and will likely charge extremely high rates.

5. Unprofessional Contact and Website

Look for a professional website with a clear physical address and corporate email addresses (not @gmail.com or @yahoo.com). Typos, broken links, and vague contact information are signs of a fraudulent operation.

What to Do If You Suspect a Scam

If a loan offer feels wrong, trust your gut.

• Stop all communication immediately. Do not send any more personal information or money.
• Verify the lender. Search the company's name online for independent reviews. Check provincial business registries to see if they are a legitimate corporation.
• Report the incident. File a report with the Canadian Anti-Fraud Centre (CAFC). This helps track scammers and protect others from becoming victims.

Frequently Asked Questions (FAQ)

How do I apply for a personal loan?

To apply for a personal loan, you first need to choose a lender to work with. If you choose an online lender, next you should fill out and submit their online application. If approved, you should hear back from the lender in a few days. You should also be prepared to provide further documents or information if the lender asks for it.

What should I do if I think I'm going to miss a payment?

‍Contact your lender immediately, before you miss the due date, as they may offer a temporary solution like a payment deferral. Waiting until after you've defaulted will result in late fees and a negative mark on your credit report.

How much money can I get from a personal loan?

Personal loans can be made for upwards of $50,000, depending on the lender and your overall ability to pay down your loan.

How long will it take for me to get my personal loan?

It can take anywhere from 1 to 3 days to get access to your funds. However, online lenders often provide same-day funding.

Do I need to provide an upfront payment to get my loan?

No. Asking for upfront payments in any form is illegal. If a lender ever asks you to do this, it is likely a scam. Do not provide them with your personal or banking information and report to the Canadian Anti-Fraud Centre.

Do I need to provide security or collateral for a personal loan?

No, not necessarily. This depends on the type of loan you apply for. Borrowers who can provide security, for example, a vehicle, can often get approved for a larger loan.

Can You Take Out Two Or More Personal Loans?

Unlike payday loans, there are no limits on how many personal loans you can take out with a lender. That said, it’s not ideal to take on too much debt at once as you’ll only be putting more stress on your finances.

I have bad credit, can I still get a personal loan?

There are many lenders all across the country who provide all Canadians, regardless of their credit, with the loans, credit, and debt relief products they need. Keep in mind that certain loan products may require a specific credit score and a credit check. No lender can or will check our credit without your express permission.

Are there penalties for paying off a personal loan early?

‍Most personal loans in Canada are 'open' and have no penalties for paying them off early, which can save you significantly on interest. You should always confirm this by checking the 'prepayment' clause in your loan agreement.

How can I make sure extra payments reduce my loan principal?

‍When you make an extra payment, contact your lender and specify that the funds should be applied directly to the principal balance. If you don't, some systems may automatically apply it to your next scheduled payment instead.