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While those in Alberta make a higher salary (on average) than all other provinces, that doesn’t mean they are immune to bad credit and other financial related issues. In fact, a high salary can often lead to overspending, which is one of the leading causes of debt and thus, bad credit.
Here are the top 5 reasons why Canadians are in debt.
So what do you do if you’re stuck with bad credit but need to secure a loan?
Did you know that bad credit can affect your daily life? Learn more here.
Bad Credit Loans in Alberta
If you are struggling with bad credit and are worried about qualifying for a loan, you can breathe a sigh of relief. There are several different borrowing options for those with bad credit in Alberta. Your local bank branch shouldn’t be your first stop when looking for bad credit loans in Alberta, instead consider one of the following options:
Local Lenders in Alberta That Don’t Check Credit
Lenders that don’t do credit checks or ones that specifically deal with individuals that have bad credit are both great options. Furthermore, there are countless online lenders who don’t check credit and who work with a wide range of individuals in Alberta, regardless of past credit mistakes.
For more information about loans with no credit check in Canada, click here.
Secured Loans in Alberta
While some secured loans may require a credit check, offering up collateral, for example, a vehicle, is another great way for credit-constrained consumers in Alberta to get the loan they need. Collateral often makes a consumer a less risky borrower and therefore a lender may be willing to accept a lower credit score.
Home Equity Loans
Home equity loans or lines of credit are types of secured loans. But, in order to apply for one of these options, the borrower in Alberta must own a house.
Want to know how you can buy a house in Canada with bad credit? Find out here.
Get a Co-signer
Asking someone you trust, who has good credit, to cosign a loan for you can open up so many more financial doors. A cosigner with good credit can provide you with the financial stability and creditworthiness you need to get approved.
When assessing your loan eligibility, your lender might look at these elements.
Credit Score Ranges in Alberta
Now that you know there are loan options for those with bad credit in Alberta, how do you know if you have bad credit or not? Well, there is no official or exact credit score that is considered bad in Alberta, as all lenders have their own rules as to which credit scores are acceptable and which are not. But, with that in mind, there are some bad credit facts that everyone should know.
- Canadian credit scores range from 300 up to 900 (the higher the better)
- Generally, any credit score over 650 is considered good
- A credit score between 600-650 is considered fair
- And a score that is lower than 600 is considered bad
- You can view your credit score fairly easily by reaching out to the bureaus
Interested in knowing the average credit scores by age in Canada? Check this out.
What Causes Bad Credit in Alberta?
As for what causes bad credit, it can be any number of different issues or bad financial habits.
- Are you making your payments on time?
- Do you have several maxed-out credit cards?
- Have you applied for many credit cards or loans within a short period of time?
- Are there errors in your credit report?
- Is your credit utilization ratio too high?
- Are you carrying around too much debt?
If you answered yes to one or more of these questions, those are likely the cause of your bad credit score.
Check out this infographic to learn how your credit score is calculated.
How Can You Improve Your Credit
So, while going with a bad credit loan is okay and often the only choice for many consumers, you might be interested in improving your credit to get a better chance at qualifying for a better loan. While it won’t happen overnight, you are definitely able to do some things that will help improve your credit over time.
Create a Budget
Making sure you’re budgeting your money properly and spending responsibly should the number one step you take. This will help you save money and get better financially so you won’t have to rely on credit and risk lowering your score even further.
Pay Down Debt
Next, you want to pay off any active debt that you have. Once you are credit card debt-free, be sure to use your credit cards responsibly going forward. Over time, with responsible use, your score will begin to climb, giving you access to cheaper loans.
Here’s how to increase your credit score without increasing your credit card debt.
Choose The Right Lender in Alberta
Keep in mind that you should always treat bad credit lending products as a way to work on improving your credit score. So make sure your lender reports to one of Canada’s two credit bureaus and always make your payments on time.
Once you’ve found the right lender, you can apply for a personal loan in Alberta.
Is a personal loan or a payday loan better if I have bad credit?
Can I get a no credit check loan in Alberta?
How much can I borrow with bad credit?
The Right Bad Credit Loan For You
Having a better understanding of bad credit loans in Alberta is your first step to breaking free from your bad credit. If you require some help in choosing the right loan for your unique situation in Alberta, Loans Canada can help.