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What can I use a Vancouver personal loan for?
It’s no secret that Vancouver is one of the most expensive places to live in Canada – and among the top 10% of the most expensive cities across the whole world. So although the average salary in the city is 14.3% higher than the national average, a massive 48% of BC residents report being just $200 from insolvency. Unsurprising, given that it can cost upwards of $2,517 a month per person just to cover the essentials.
It’s therefore very useful to know that a personal loan can be used for almost any expense. That includes: daily living costs, such as rent, mortgage payments, property taxes, utilities, groceries, and transit; emergency expenses, such as medical or dental care, car repairs, and so on; and discretionary purchases like vacations, weddings, and home improvements. As long as you make your personal loan repayments on time, you can use the funds however you wish.
How much can I borrow with a personal loan in Vancouver?
The average Vancouverite holds $22,818 in non-mortgage consumer debt; this is one of the highest levels in all of Canada, and it’s noticeable that credit card debt is particularly high in the metro area, at an average of $12,332. On top of this, mortgage debt is also very high across the city, both in absolute terms and relative to the rest of the country.
All of this existing debt may leave locals wondering if they’ll be able to borrow any more money; the good news is that the amount any individual can borrow is not solely determined by how much they already owe in loans. Factors such as income, credit score, assets, type of personal loan, and lender rules all influence how much a person can access via a personal loan. In general, loans of up to $35,000 are usually available on an unsecured basis, to those who qualify.
What credit score do I need to get a personal loan in Vancouver?
Credit score can be an important factor in qualifying for certain personal loans; however, not every lender will do a credit check, and among those that do perform one, the minimum required score to qualify for a loan can differ quite a bit. So you always need to check a lender’s terms before applying.
Vancouver has the second highest average credit score of any city in the country, at 705 – significantly higher than the national average of 672. This is easily high enough to pass the credit score requirement of most banks (650), as well as the more widely-held requirement amongst online lenders (560). However, even those falling below this level have options, via bad credit personal loans.
What income do I need to get a personal loan in Vancouver?
There is no single income level that will guarantee approval for a personal loan in Vancouver; this is because most personal loan providers base loan approval on multiple factors, only one of which is income. So even if you earn more than average (the median income in the city is $96,423), you still need to take into account your other financial characteristics, like credit and existing debt levels.
The opposite is also true; income inequality in Vancouver is the third highest in the country, and the unemployment rate is 5.1%. But even if you are working in Canada’s most expensive city for minimum wage, or are without employment entirely, you may still qualify for certain personal loans. You just need to find the right lender.
What’s a HELOC and can I get one in Vancouver?
In a city where so much of people’s wealth is tied up in real estate (the average property sells for nearly $1.3 million, double the price seen in most other major Canadian cities), it’s unsurprising that people want to use their home to help them get a loan. This is why the prevalence of HELOCs (home equity lines of credit) is rising in Vancouver, even as residents reduce the size of their auto loans and other lines of credit.
A HELOC can provide low interest access to flexible amounts of capital. They’re not quick to get, so don’t work for those who need cash in a hurry, but for longer term borrowing they’re a great option. Just remember that, as with any type of secured loan, your collateral (in this case, your home) will be at risk if you fail to make your loan repayments.
Written by:
Amy Orr
Amy Orr is a professional writer and editor with over 10 years of experience in the Canadian, U.S. and U.K. financial markets. She has written for numerous publications on topics as diverse as economic literacy, corporate finance, and technical analysis of numerical data. Prior to transitioning to full-time writing, she worked in the hedge fund sector. Her academic background is astrophysics, and she has a Masters in Finance from the University of Edinburgh Business School.
Reviewed by:
Jenna West
Jenna West is Smarter Loans' in-house financial writer and content director. She has been covering the Canadian FinTech and finance industry since 2017, including financial trends analysis, industry surveys, regulatory updates and changes in Canadian consumer behaviour when it comes to finance.
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