Filters
- Amount
- Up to $35,000
- Rate
- 9.99% – 34.95%
- Term
- 9 – 78 Months
- Amount
- Up to $60,000†
- Rate
- 19.99% – 34.99%*
- Term
- 6 – 120 months
- Amount
- Up to $10,000
- Rate
- Varies by product
- Term
- Varies by product
A loan is a great tool when you’re looking to spread the costs of a large expense or ease financial pressure when money is tight. However, it can be hard to choose the right loan when you start looking into your options, especially if you have poor credit or inconsistent income.
Let’s break down your choices and help you find and choose the loan and repayment plan that best fits your financial situation.
What Types Of Loans Are Available To Ontario Residents?
Ontario residents have plenty of loan options to choose from, including the following.
Personal Loans
A personal loan provides a lump sum of money that is paid back in fixed monthly installments over a set term. It’s usually unsecured, which means no collateral is required, and it can be used for just about any purpose.
Interest rates on personal loans depend on your credit score, income, and lender. Once approved, the money is deposited into your account and repayment begins. Payments include both principal and interest, and are made until the loan term ends and the loan is fully repaid.
Personal Loan Features
| Loan Amount | Most lenders offer between $500 — $35,000. |
| Interest Rate | Interest rates range around 9.99% — 35%. |
| Loan Terms | 3 months — 5 years |
Learn more: Best Personal Loans In Canada
Lines Of Credit
A line of credit is a flexible revolving type of financing that lets you borrow up to a set limit as needed. You only pay interest on what you borrow, then once the funds are repaid, you can borrow again.
Lines of credit are ideal for managing cash flow and covering emergencies, especially if you need money sporadically and prefer not to apply for additional loans as the need for money arises.
Line Of Credit Features
| Loan Amount | $5,000 — $100,000+, depending on your income, credit, and lender |
| Interest Rate | Typically variable interest rates, which are tied to the lender’s prime rate |
| Loan Terms | No set term; they’re open-ended and can be repaid at any time |
Learn more: Best Line Of Credit Rates In Canada 2025
Zero-Interest Loans
Some financial apps are available in Canada that offer small cash advances or lines of credit with no interest. With these options, you can get a quick advance of funds and enjoy zero interest.
| MoneyUp | MoneyUp offers up to $1,000 in instant credit with no interest or credit checks. |
| Nyble | Nyble offers a zero-interest line of credit up to $250, which can also be used to build credit without a credit check. |
| Bree | Bree offers up to $500 in instant cash advances with no interest, fees, or credit checks. |
| KOHO Cover | KOHO Cover offers a small cash advance of up to $250 interest-free, with no credit checks, though a small monthly subscription fee is required. |
Payday Loans
A payday loan is a high-cost, short-term loan for up to $1,500 that must be repaid in one lump sum by your next payday. Loan terms can range from 2 weeks to up to 62 days.
Payday loans are very easy to qualify for and typically don’t require a credit check. However, because of their high cost and short repayment term, they should be considered only after other options have been explored.
Payday Loan Features
| Loan Amount | Up to $1,500 (cannot exceed 50% of your net income) |
| Interest Rate | $14 per $100 borrowed |
| Loan Terms | Payment is usually due by your next paycheque, but terms can be extended up to 62 days. |
Learn more: Payday Loans In Ontario
Thinking About Getting A Loan? Here’s What Lenders Look For
Loan requirements vary from lender to lender. That said, there are a few common things all lenders look at:
- Residency: You need to be a resident in the province where the lender operates.
- Income: Lenders will want to see proof of income that shows you earn enough to cover loan payments on top of your existing bills.
- Employment: Most lenders require you to be employed for at least 3 to 6 months. However, some lenders, such as payday lenders, may approve your application even if you’re not currently employed, as long as you can demonstrate you have a consistent source of income. This may include non-employment income like government benefits or private pensions.
- Debt-To-Income (DTI) Ratio: Lenders use your bank statements to get an average of your DTI ratio to make sure your income is sufficient to cover additional loan payments.
- Credit Check: Many lenders conduct a credit check to verify your creditworthiness, though some lenders don’t, especially for payday loans.
Can I Get A Loan With Bad Credit?
Yes, you can get a loan with bad credit; however, you’ll generally need to apply with an alternative lender instead of a bank. Payday loans, in particular, are easy to get approved for even without good credit, as these lenders don’t typically conduct a credit check.
Learn more: Personal Loan Eligibility Requirements For Bad Credit Lenders
How Do I Apply For A Loan
To apply for a loan, follow these steps:
Step 1: Determine Your Loan Type
Personal, bad credit, secured, payday, line of credit, etc.
Choosing the right loan depends on your financial needs and credit profile, such as the following:
- Personal installment loans
- Bad credit loans
- Secured loans
- Lines of credit
- Payday loans
For instance, a personal loan may be suitable if you need a larger sum of money and have decent credit. A payday loan, on the other hand, may be worth considering if you have a small, urgent expense but lack the credit health needed for a traditional loan.
Step 2: Check Eligibility Requirements
Lenders assess your ability to repay the loan based on several factors as mentioned earlier, such as your:
- Income
- Employment
- Banking information
- Credit score
Make sure you meet the lender’s criteria before applying to avoid getting turned down for a loan.
Step 3: Compare Lender Offers
Shopping around for a lender can help you find the best deal. A quick and easy way to find a lender is by using an online loan comparison platform like Loans Canada, which allows you to view multiple offers at once. You can then compare interest rates, loan terms, fees, and funding speed.
Many lenders also offer pre-approval with a soft credit check so you can see what rate you may be charged without affecting your score.
Step 4: Complete The Application
Once you’ve decided on a lender, fill out their application form, either online or in person (depending on lender availability). You will also need to provide certain documents along with your application, such as your:
- Government-issued photo ID
- Proof of address
- Banking information
- Pay stubs
- Employment letter
Step 5: Get Approved
After submitting your application and documents, it’s time to wait for approval. Depending on the loan type and lender, approval times will vary.
For instance, online lenders often provide instant or same-day decisions, while banks and credit unions may take up to 3 business days or more to make a decision.
Step 6: Receive Your Funds
Once you’re approved, the funds may be sent to you either via direct deposit or e-Transfer. Some lenders offer same-day funding, while others may take a day or two.
Is There A Way To Guarantee Loan Approval?
No, there’s no such thing as guaranteed approval, but you can do things to improve your approval odds:
- Keep an eye on your debt-to-income ratio. Taking on too much debt is never a good idea. Always make sure your debt-to-income ratio is less than 35%. To calculate your ratio, figure out how much your debt is costing you per month, divide that number by your monthly income, then multiply by 100.
- Ask a friend or family member to cosign for your loan. If you’ve been declined for the loan you need, consider asking a trusted friend or family member to cosign your application, someone with a better income/financial standing. A good cosigner can help those who are unable to get approved because of financial issues.
- Choose the right lender for your financial situation. Many lenders in Ontario will work with anyone, regardless of their credit or financial standing, and there are many lenders that have stricter lending guidelines. It’s important that you choose the lender that is right for your unique needs.
| Is Bad Credit Holding You Back? If your bad credit score is making it difficult for you to access funding, consider taking steps to improve your score before applying for a loan. You can use credit-building tools such as secured credit cards, savings loans, or other specialized products designed to strengthen your credit profile. If you rent, you can also build credit through rent payments using services like Chexy, which report your rent to major credit bureaus. |
Ready To Apply For A Loan? Don’t Forget To Take This Into Consideration
Before submitting a loan application, take a moment to consider a few key factors that could impact your approval and long-term financial health.
Is Taking a Loan the Smart Move Right Now?
Before taking on debt, it’s important to consider whether taking on debt is worth it. Here are a few scenarios where a loan might make sense:
- To cover a large expense upfront that can be repaid over time.
- To pay for an emergency expense.
- To cover rent or other basic necessities.
Essentially, a loan might be worth it if you’re covering a pressing need. Leisurely expenses, like vacations or expensive toys, may not be worth taking on additional debt for.
Compare Offers And Get Pre-Approvals
Comparing loan offers helps you find the lowest rates and best terms, which can potentially save you hundreds of dollars or more over time.
Further, getting pre-approved gives you a clear picture of what you can comfortably afford, so you can shop confidently and avoid unpleasant surprises. It also strengthens your position with lenders, showing you’re financially capable.
Do You Have A Bank Account?
Having a bank account shows lenders you’re financially stable. It also provides a way for funds to be deposited for repayments to be withdrawn and tracked. Many lenders also use instant bank verification (IBV), which instantly confirms your bank account’s ownership, status, and transaction history to speed up approvals.
If you don’t have a bank account, you’ll be seriously limited in your loan options. Luckily, it’s easy and free to open a bank account. You can open a free bank account with digital banks like Simplii Financial, Tangerine, or Neo, which offer no monthly fees and no minimum balance. Simply apply online using your photo ID, Social Insurance Number (SIN), and address, and set up your new account in minutes.
Learn more: Where Can You Get Free Bank Accounts In Canada?
How Much Will Your Loan Cost You?
Your total loan cost will depend on the following:
- Interest Rate: The rate you’re charged is based on your credit strength and income.
- Loan Term: Longer loan terms allow you to spread out your payments over time, which means lower monthly payments compared to shorter terms. However, you’ll pay more interest over the life of the loan.
- Loan Amount: A higher loan amount means more money needs to be repaid, as well as more interest charged.
What’s The Difference In Cost Between A Personal Loan vs. A Payday Loan vs. A Line of Credit?
Here’s a comparison table showing the difference in cost between a personal loan, payday loan, and a line of credit for a $1,500 loan:
| Loan Type | Interest Rate (APR) | Term | Required Payment | Total Payment |
| Personal Loan | 15% | 12 months | ~$137/month | ~$1,644 |
| Payday Loan | $14 per $100 | 2 weeks | ~$1,710 lump sum | ~$1,710 |
| Line of Credit | 25% | Revolving (flexible) | ~$60/month (minimum payment) | ~$1,800 (if paid over 12 months) |
Is Your Lender Reputable?
Beware of fraudulent lenders in Ontario, especially within the bad credit lending sphere. Many predatory lenders target unsuspecting borrowers, particularly those with minimal access to credit who are in immediate need of financial help.
If you’re offered a large loan with low interest despite poor credit, it’s likely a scam. When a deal sounds too good to be true, it usually is.
To find a legitimate lender in Ontario, use the provincial government’s online database.
| Have You Been A Victim of Loan Fraud? If you’re currently dealing with loan fraud or personal identity fraud, please contact all of the following institutions: – Your bank – Your credit card companies – Local police – Both credit reporting bureaus (Equifax and TransUnion) – Any organizations that might have your information or credit accounts in your name Contact the Ministry of Consumer Services of Ontario for help and more information. |
Need More Financial Support? Check Out These Financial Assistance Programs
While a loan can help in many financial emergencies, it’s not always the best choice if you’re struggling to pay your bills every month. Instead, consider speaking to a credit counsellor for the best debt relief programs for you. You can also look into various government benefits and non-profit services to get extra financial assistance.
Additional Government Benefits Available In Ontario
Bottom Line
Even if your credit isn’t perfect or your income is unpredictable, that doesn’t mean you’re out of options. There are still many lenders offering flexible loan programs designed for challenging financial situations. If you’re in need of a loan, regardless of your credit or financial profile, do some research on lenders in Canada who work with borrowers like you, which can be done quickly and easily using Loans Canada.
