A Guide To Getting A Loan In Prince Edward Island
Filters
- Amount
- Up to $35,000
- Rate
- 9.99% – 34.95%
- Term
- 6 – 84 Months
- Amount
- Up to $60,000†
- Rate
- 19.99% – 34.99%*
- Term
- 6 – 120 months
- Amount
- $500 – $10,000
- Rate
- Up to 34.99%
- Term
- Up to 60 months
Choosing the best financing solution can be challenging, given all the options available. Picking one is especially tough if your credit history is sketchy or your income isn’t steady or sufficient. In this guide, we’ll look at various loans in PEI and help you identify the one that fits your financial situation best.
What Types Of Loans Are Available To Residents Of PEI?
Many loan programs are available to residents of PEI, including the following:
Personal Loans
A personal loan provides borrowers with a fixed amount of money that is repaid via installments over a set term with interest. These loans are often unsecured, which means they don’t require collateral. Funds can be used for various purposes, such as debt consolidation, home improvements, or emergency expenses.
Personal Loan Features
- Loan Amounts: $500 — $35,000+
- Interest Rates: 9.99% — 35%
- Loan Terms: 3 months — 5 years
Learn more: Your Guide To Personal Loans Prince Edward Island
Lines Of Credit
A line of credit is a flexible financing program that lets you borrow funds up to a set limit, similar to a credit card. You can withdraw as much money as you want as needed — up to the credit limit — then repay it on your own schedule. You only pay interest on the amount you actually use, and not the full credit limit.
You can continue borrowing and repaying from your credit line repeatedly, similar to how a credit card works.
Line Of Credit Features
- Loan Amounts: $5,000 — $100,000+
- Interest Rates: Typically variable rates, tied to the lender’s prime rate
- Loan Terms: Open-ended with no set term
While lines of credit may come with high credit limits, interest, and credit checks, some unique options may be more accessible for bad credit borrowers and those in need of smaller loans, like the following:
| MoneyUp | MoneyUp offers a line of credit up to $1,000 with no credit check. It’s meant to help users manage short-term cash needs affordably. |
| Nyble | Nyble provides a no-interest line of credit of up to $250 without requiring a credit check. Users can use Nyble to also build credit history. |
Learn more: Guide: Line Of Credit
No-Interest Cash Advances
A no-interest cash advance is a short-term loan that allows you to borrow a small amount of money without paying any interest on the borrowed funds. These advances are often offered through online platforms and don’t require a credit check, making them accessible to bad credit borrowers. While there’s no interest, some providers may charge a small monthly subscription or transfer fee.
Here are a couple of noteworthy options:
| Bree | Bree offers interest-free cash advances of up to $500 with no credit checks. |
| KOHO Cover | KOHO Cover provides instant, interest-free cash advances up to $250 through a subscription that also includes financial coaching. |
Payday Loans
Payday loans are short-term, high-cost loans, typically available for up to $1,500. They’re easy to qualify for, often requiring no credit check, but come with very high fees that make them among the more expensive loan options out there. Borrowers receive quick cash with few requirements, but must repay the full amount plus fees within a very short period of time, which can lead to a cycle of debt.
Payday Loan Features
- Loan Amounts: Up to $1,500
- Interest Rates: $14 per %100 borrowed
- Loan Terms: Up to 62 days
Learn more: How To Get A Payday Loan In Prince Edward Island
Thinking About a Loan? Here’s What Lenders Look For
Loan eligibility criteria can differ depending on the lender, but most will look at a few key factors before approving your application:
- Residency: You must live in the province where the lender operates and show proof of address.
- Income Verification: Lenders typically require documentation showing that your income is sufficient to cover loan repayments as well as your current expenses.
- Employment Status: Lenders prefer applicants who have held a job for at least a few months to show employment stability.
- Debt-To-Income Ratio (DTI): Your bank statements help lenders evaluate how much of your income is already dedicated to paying existing bills to ensure you can handle additional payments.
- Credit History: A credit check is typical, though some lenders — especially payday lenders — usually skip this step.
Can You Qualify With Poor Credit?
Yes, it’s possible to get approved for a loan even with a low credit score. While you may be turned down by traditional banks, alternative lenders often serve bad credit borrowers.
How To Apply For A Loan In Nova Scotia
When you’re ready to apply for a loan, follow these steps:
Step 1: Review Your Credit Score
Understanding your credit score before applying can give you insight into your borrowing power. You can get your score for free using various online tools, like Loans Canada’s CompareHub, to help you determine your eligibility.
Step 2: Compare Lenders
Take time to research different lenders and loan products, paying particular attention to interest rates, repayment terms, and qualification criteria. Online loan comparison platforms like Loans Canada make it easy to view multiple offers side-by-side based on your financial profile.
Step 3: Submit Your Application
Complete the application form and provide all required documentation. Many lenders now use secure instant bank verification (IBV) to confirm your income and identity, streamlining the process.
Step 4: Receive Your Funds
Once approved, carefully read through the loan agreement to ensure you’re comfortable with the terms and your obligations. After signing, the funds will be deposited directly into your bank account via e-transfer or direct deposit.
Learn more: How To Apply For A Loan
Can I Be Guaranteed Loan Approval?
No legitimate lender will promise automatic approval without some level of vetting. Even payday lenders will still want to ensure you can repay your loan, which requires some assessment of your financial health. That said, there are things you can do to boost your chances of loan approval:
- Monitor Your Debt-To-Income Ratio: Avoid overextending yourself financially and taking on more debt than your income can handle. Aim to keep your debt-to-income (DTI) ratio below 35%.
- Consider A Cosigner: If you can secure a loan by your own merit, ask a financially stable friend or relative to cosign your loan. A strong cosigner can help reduce the lender’s risk and improve your approval odds.
- Pick The Right Lender: Not all lenders have the same loan criteria. In PEI, some lenders specialize in working specifically with borrowers who have poor credit or irregular income, while others have strict standards. Working with a lender that aligns with your financial and credit profile is key.
| Struggling With Bad Credit? If you have bad credit, improving it before applying for a loan can open more doors. Try using tools like secured credit cards, credit-builder loans, or rent-reporting services to strengthen your credit history over time. |
How Do I Find A Reputable Lender In PEI?
PEI has its fair share of dishonest lenders looking to take advantage of vulnerable and unsuspecting borrowers. If you receive an offer for a large loan with unusually low interest — especially when you didn’t expect to qualify — it could be a scam. Use your gut instincts and learn the signs of loan scams before proceeding with a loan from these lenders.
To find a legitimate lender in PEI, consider these steps:
- Check PEI’s Corporate Registry: Use the PEI Business / Corporate Registry to see if the lending company exists legally in PEI.
- Contact Financial & Consumer Services Division, PEI: This entity is responsible for overseeing many financial licensing issues in PEI. You can use this source to ask if a specific lender is licensed or regulated.
- Ask for License Number: Ask the lender for proof of licensing or registration. They may also post their license number on their website or storefront.
- Check Out Online Reviews: Use online review sites to see if there are complaints about the lender.
| Have You Been The Victim Of A Loan Scam? If you have become a fraud victim or have had your personal information stolen and used against you, there is an organization located on Prince Edward Island that can help you: Mail: Financial & Consumer Services Shaw Building, 1st Floor North 105 Rochford Street PO Box 2000 Charlottetown, PE C1A 7N8 Email: ccs@gov.pe.ca Telephone: 902-368-4550 Fax: 902-368-5283 |
Can I Get A Loan In Person?
If you’re looking to apply for a loan from an alternative lender, you’ll find that most of them operate solely online. However, a handful also offer in-person services in PEI for those who prefer face-to-face service, including the following:
| Locations | |
| Fairstone | — 201 Buchanan Dr., Unit 6, Charlottetown, PE C1E 2E4 — 454 Granville St., Suite 11, Summerside, PE C1N 4K7 Find a Fairstone branch near you. |
| easyfinancial | — 9 Babineau Ave, Charlottetown, PE C1A 0C9 — 505 Granville St, Summerside, PE C1N 6V7 Find an easyfinancial branch near you. |
| Money Mart | — 417 University Avenue Charlottetown, PE C1A4N7 Find a Money Mart branch near you. |
Thinking About Applying For A Loan? Here’s What To Keep In Mind
Before you move forward with a loan application, make sure to consider a few important factors that could affect both your approval chances and your financial health:
Is Now the Right Time to Borrow?
Taking on additional debt can be helpful, but you’re also adding to your overall financial burden. Make sure you weigh whether a loan is truly necessary. If you need the money to cover essentials, then it might make sense. Otherwise, if you’re spending money on leisurely things, it may be better to hold off.
Compare Lenders & Get Pre-Approved
Shopping around for loan offers can help you find the best rates and terms, potentially saving you hundreds or more over time. Getting pre-approved also gives you a clearer idea of what you can afford and shows lenders that you’re financially strong, which may improve your chances of approval.
Do You Have A Bank Account?
Having an active bank account is often a requirement for loan approval. It allows lenders to deposit funds and make automatic repayments. Lenders may use instant bank verification (IBV) to confirm your account details and transaction history quickly. If you don’t yet have a bank account, your borrowing options will be limited.
That said, opening a bank account is quick, easy, and often free. Online banks like Simplii Financial, Tangerine, and Neo offer no-fee accounts with no minimum balance requirements. You can apply online using your SIN, photo ID, and address.
Learn more: Where Can You Get Free Bank Accounts In Canada?
What Will Your Loan Cost?
The total cost of your loan depends on several factors, as noted, including the interest rate, loan term, and loan amount. Consider crunching the numbers to see if your loan can fit within your budget. You can make these calculations quickly and easily using an online loan calculator.
Personal Loans, Payday Loans, & Lines Of Credit: What’s The Difference In Cost?
Here’s a comparison table displaying the difference in cost between personal loans, payday loans, and lines of credit on a $1,500 loan:
| Loan Type | Interest Rate (APR) | Term | Required Payment | Total Payment |
| Personal Loan | 9.99% | 12 months | ~$132/month | ~$1,584 |
| Payday Loan | $14 per $100 borrowed* | 2 weeks | ~$1,710 lump sum | ~$1,710 |
| Line of Credit | 7.99% | Revolving (flexible) | ~$130/month (minimum payment) | ~$1,560 (if paid over 12 months) |
*in all provinces except Quebec and the territories.
Need More Financial Support? Look Into These Financial Assistance Programs
| Employment Insurance (EI) | Learn More |
| Canada Child Benefit (CCB) | Learn More |
| Maternity/Parental Leave | Learn More |
| Federal Disability Tax Credit | Learn More |
| Compassionate Care Benefits | Learn More |
| GST/HST Tax Credit | Learn More |
| Green Tax Credits | Learn More |
Bottom Line
Loans can be a powerful financial tool when money is tight or simply to achieve certain financial goals, like buying a home or car. With the right approach, loans can provide you with the financial support you need when you need it most. Be sure to do your research to make an informed decision.
