Loan Companies

Financing plays such a large role in Canada. Think about it, with over 36 million citizens, each one of them is affected by a loan whether it’s a mortgage or business loan. That is why it is absolutely crucial for folks to be aware of the options ahead of them when it comes to work with loan companies. At Smarter Loans, we have a wide range of loan companies we work with that specialize in a variety of circumstances. Whether it is personal or business applications, our loan companies handle it all.

When connecting with our loan companies, you can expect friendly rates to work with and fantastic customer service. In fact, most of our applicants are able to see their funds within days of applying. It’s normal to be concerned your credit score before applying but the truth is that as long as you connect with the right loan company, you have a high chance of being approved. This is because every provider specializes in different types of loans and is prepared to handle applicants in unique circumstances. In order to ensure your success, we’ve created a much more efficient method for you to discover and apply directly to a loan company that can handle your loan request. You can review all of you need to within the directory below. Things like interest rates, offerings and customer reviews are available for you directly below.

After choosing a suitable option, you can apply directly by clicking “Apply Now” and after completing a set of questions to qualify, your loan will be on it’s way. However, if you can’t seem to decide, you can alternatively pre-apply with Smarter Loans. We’ll select the best loan company in Canada for you and your current predicament!

We can help connect you with the top loan providers in Canada.

Pre-Apply For A Personal Loan Now

Top Loan Companies Providers in Canada

Interest Rate
$500 - $15,000
29.99% - 47.72%
12 - 60 Months
$120 - $15,000
29.90% - 46.90%
12 - 60 Months
$500 - $30,000
19.99% - 39.99%
6 - 120 Months
$5,000 - $35,000
Starting at 9.9% (Good Credit Only)
6-60 months
$500 - $10,000
12.99% - 39.99%
9 - 36 Months
$500 - $1,000
3 - 6 months
$5,000 - $50,000
Starting at 5.75% (Good Credit Only)
1 to 7 Years
$1,500 - $12,500
19.99% - 34.99%
12 - 60 Months
$1,000 - $5,000
19.9% - 45.9%
12 - 36 months
$1,500 - $20,000
19.99% - 46.8%
12 - 60 Months
$2,000 - $10,000
34.9% - 43%
12 - 60 Months
$100 – $15,000
19.99% - 46.93%
Open Line of Credit
$500 - $10,000
Open Line of Credit

Loans: The Basics

What Is a Loan?

A loan is a sum of money (or asset) which is borrowed from an institution, bank, company or person, to be repaid at a future date. The vast majority of loans in Canada are provided by dedicated financial institutions, and have well-defined terms and expectations. Almost all loans come with interest on the amount borrowed, so it costs money to borrow money.

Applicant/borrower is you, the person hoping to get a loan.

Lender/provider is the company giving you the loan.

Unsecured refers to loans that do not have any backing, so in the event of a default the lender is left with nothing.

Fees are the one-off amounts you pay for certain actions, such as applying for a loan, starting a loan, and so on.

Interest is the amount you pay for the loan, calculated as a percentage of the amount borrowed. Interest rates can be fixed (meaning you pay the same amount of interest over the life of the loan) or variable (meaning the interest rate varies over time). The APR is the annual percentage rate.

Downpayment is the amount of money you contribute towards a purchase, on top of the loan you use to complete the purchase. A downpayment can help you secure better loan terms, and some loans require a downpayment – for example, a mortgage.

Penalties are amounts you pay when you do not meet the loan terms.

Principal is the core amount of money borrowed, excluding interest.

Default is what happens when you do not make your loan payments, and are considered to have broken the loan contract.

Secured refers to loans that are backed by an asset or collateral, so that in the event of default the lender can seize the asset in lieu of payment.

Loan term is the lifetime of the loan – how long you have it for. Some loans are open-ended (like a credit card) while others have a set term (like a mortgage).

Payment schedule gives details of your payments on the loan – how often you must make payments, and how much those payments are. Payments are usually principal plus interest.

Loans in Canada: The Stats

  • 73.2% of Canadians have some type of outstanding debt.
  • A mortgage is the most common and the largest type of debt held by Canadians. 40% have one, and the median amount owed is $200,000.
  • 56% of Canadians have outstanding debt other than a mortgage or home equity line of credit.
  • The median non home related debt amount owed by Canadians is $30,000.
Source: Statistics Canada 2019

Types of Loans

Loan types fall into two main categories: secured, and unsecured. But after this designation, there also comes short term and long term loans, open-ended and closed-ended loans, personal and business loans, and so on. There are many different designations and ways to look at loans, so for simplicity we have grouped them by use:

Personal, General Loans

Personal, general loans are loans that are for personal use, but that can be utilized for almost any reason: one off expenses, emergency funds, to pay monthly bills, to aid with cash flow, as a money management mechanism, or to aid with a purchase. There are few restrictions on how these loans can be spent, and they can be either secured or unsecured. 

Specifics vary by lender, but interest rates can range from 4% to 20%+, with the average sitting at 9.5%. Most personal loans have an upper borrowing limit of $50,000. Terms range from weeks to years (or open-ended), and eligibility criteria depend on the lender and the borrower’s personal circumstances.

Popular types of personal loans include:

  • Personal Loans
  • Credit Cards
  • Bad Credit Loans
  • Emergency Loans
  • Cash Advance Loans
  • Payday Loans
  • Online Loans
  • Same Day Loans
  • Home Equity Lines of Credit
  • Lines of Credit

Personal, Purpose-Specific Loans

There also exist loans for personal use, but that are geared towards a specific need – either a purchase or a problem. Two of the most common loans in Canada (mortgages and auto loans) fall into this category, and while these two are secured, many others are not.

Loan terms vary widely depending on the type of loan; mortgages can have interest rates as low as 2% and terms that last 25 years, while others, such as debt consolidation loans, have much higher rates and shorter lifespans. Eligibility requirements also fluctuate depending on the loan’s use; mortgages are large, long term instruments with a lot of requirements, while auto loans can be short-lived and easy to qualify for. 

Purpose-specific loans include:

  • Mortgages
  • Auto Loans
  • Student Loans
  • Debt Consolidation Loans
  • Car Repair Loans
  • Appliance Loans
  • Dentist Loans
  • Wedding Loans
  • Home Improvement Loans
  • Vacation Loans

Business-Related Loans

If you are not seeking financing for personal use but for your business, then there are plenty of options for you too. Business loans have some different eligibility requirements than personal loans, but can be used for just as varied reasons. Terms depend entirely on your business’s circumstances, need, size, assets, revenues and age.

Common types of business loans include:

  • Commercial Mortgages
  • Business Loans
  • Small Business Loans
  • Business Lines of Credit
  • Business Credit Cards
  • Merchant Cash Advances
  • Working Capital Loans
  • Inventory Loans
  • Equipment Loans
  • Invoice Loans
  • Vehicle Loans
Source: Statistics Canada 2019

Types of Loan Providers

Loan providers come in many shapes and sizes. Broadly speaking, they fall into one of a few major categories:

Banks and Credit Unions

Banks and credit unions are perhaps the most obvious source of financing, and they cater to the majority of Canadians seeking a loan – especially when the loans are large and long term, as with mortgages. However banks and credit unions typically have stricter eligibility requirements than other types of lender.

Other Financial Companies

There are literally hundreds of financial companies in Canada apart from banks and credit unions, of all sizes and in every conceivable specialty. These include general loan companies, payday lenders, credit card companies, equipment or vehicle specialists (or even dealers, who sometimes offer their own financing), merchants, and financial service providers of all kinds. They can have quite diverse loan terms, depending on the specialty (if any) and the type of borrower they cater to.

Online Lenders

Lastly, there exist a fairly new category of lenders: online-only. These are companies who offer, service and manage all of their loan offerings via an online platform, with no brick-and-mortar locations at all. These companies have the advantage of lower overheads, and so can sometimes offer better rates or more flexible terms than more traditional lenders. However there are predatory lenders in this category, so it’s important to always check a company’s reputability before borrowing from them.

Source: Statistics 2019

What Affects Loan and Provider Type?

When applying for a loan, there are some factors to take into account that will influence what kind of loan you can get, from whom, and what the terms are likely to be. Make sure you have a good grasp of:

  • Your credit score
  • Your past financial history, including any bankruptcies or consumer proposals
  • Your income level
  • Your existing debt levels
  • Your assets and existing savings

Once you know all of this, you can narrow down your list of possible providers and start comparing loans to find the best option for your needs.

Frequently Asked Questions About Loans

What’s the average interest rate on a loan?

Interest rates on loans vary depending on the type of loan, your personal circumstances, and the lender you use. Rates can vary from as little as 2% to as much as 20%+. The average for a personal loan is 9.5%.

What are the types of loan provider?

Loan providers come in all shapes and sizes; the most common place to get a loan is a bank or credit union, but there are also many online lenders and other financial providers (such as payday lenders, general lenders, auto loan specialists, and so on) who can help you get a loan.

What kind of loan do I need?

There are loans for almost every conceivable need, and the kind of loan you want will depend entirely on what you’re going to use it for. It is personal, or for your business? Is it for a one-off purchase, or for more general use? Will you need it on an ongoing basis? Are you able to pay it off very quickly? All these factors and more influence the type of loan that best suits your circumstances.

What do I need to apply for a loan?

To apply for a loan in Canada, you don’t need much, just proof of residency, ID (showing that you are age of majority), and proof of address. After that, you will probably also be required to show proof of income or some other financial information. Exact requirements vary by lender, and details of required supporting paperwork will be shown on a loan’s application form.

How much can I borrow with a personal loan?

A personal loan usually tops out at $50,000, although larger amounts than this are available to those with excellent credit or other extenuating circumstances.
My bank won’t lend to me. What can I do?
Banks have strict lending requirements that usually start with a minimum credit score. If you don’t pass this threshold, it’s likely your bank won’t be able to help you. But never fear, there are still plenty of lenders who will work with you. Bad credit lenders exist purely to service those with poor credit scores, a history of bankruptcy, and other difficult circumstances.

Can I get a loan if I have no income?

Yes, it is still possible to get a loan if you have no income, although it is worth remembering that you may not be able to borrow as much as if you had a salary, and the interest rates may be higher to offset the lender’s risk.

How much will my loan payments be?

Your loan payments depend on the amount you borrowed, your interest rate, and your loan term. Generally speaking, your payments will include some portion of the principal you’re paying down, plus interest charges. Check online loan calculators to see what the exact numbers will be in your case.

Written By Smarter Loans Staff

The Smarter Loans Staff is made up of writers, researchers, journalists, business leaders and industry experts who carefully research, analyze and produce Canada’s highest quality content when it comes to money matters, on behalf of Smarter Loans. While we cannot possibly name every person involved in the process, we collectively credit them as Smarter Loans Writing Staff. Our work has been featured in the Toronto Star, National Post and many other publications. Today, Smarter Loans is recognized in Canada as the go-to destination for financial education, and was named the “GPS of Fintech Lending” by the Toronto Star in 2019.

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