The size of loan you qualify for will depend on the type of loan and your personal circumstances, including your credit score and income.
How do I get a loan in NWT?
There are only three absolutes when it comes to qualifying for a loan in NWT:
- You must be at least 19 years old
- You must be a resident of the province
- You must have an active bank account
If you meet these requirements, you must then address the specific terms of your chosen lender, which usually relate to income and credit score. The average resident in NWT shouldn’t have any trouble qualifying for most loans, as the average household income ($125,657) is 33% higher than the national average – making it one of Canada’s most prosperous regions. In addition, the average credit score is 637, above the 600 threshold most lenders require. However, if your income is lower than average or you have poor credit, there will still be loans you can qualify for. You may however need to try an alternative or niche lender with more flexible criteria.
Where can I get a loan from in NWT?
NWT may be remote, but its wealthy population ensures an active financial services market. There are many different loan providers available in the territory, including:
- Credit unions
- Online lenders
- Payday lenders
- Other financial service companies, like
- Mortgage companies
- Vehicle and equipment specialists
- Credit card companies
- No credit check lenders
- Bad credit loan providers
- Government of Canada
- Government of NWT
The best lender for you will depend on the type of loan you need and your financial situation.
Can I get a business loan in NWT?
NWT is rich with mining and construction businesses, many of whom rely on external financing to weather tough times and meet new challenges. Thankfully, the business community has a lot of support from public and private bodies hoping to ensure a continued thriving economy. If you are seeking a business loan from a traditional lender, like a bank, you will need to be able to show:
- A business history lasting at least two years, including bank statements and tax returns
- A business plan
- Proof of revenues, profitability, and projected future revenues
- Collateral (for property, equipment, invoice and vehicle loans)
- Credit history for the business and the business’s owners
Alternative lenders will be able to help businesses with more niche needs, like startup loans or bad credit commercial loans. And there are federal and provincial programs for qualifying businesses. These are typically targeted at Indigenous businesses, new ventures, or companies in the agricultural, mining, tourism or film industries.
How do I choose the right loan provider in NWT?
Choosing the right loan company starts with understanding what type of loan you need. Not every lender offers every type of loan! So step one is finding a loan provider in NWT who has what you need. Step two is understanding your personal financial situation – your credit score, your income, your collateral, and your other debts. These factor into which companies will work with you. Every lender has their own set of eligibility criteria, so narrow down your list of possibilities by comparing their requirements against your position. Now you have a list of providers who can offer you what you need, and who will work with you. Step three is finalizing your choice: compare each company’s rates, terms and reviews to find a reputable company with a product you can afford. As NWT has a smaller loan market than the provinces, interest rates may not be as competitive, so always remember to check online for the best deals.
Can I get an NWT loan if I’m unemployed?
NWT may have a high average income, but it also has high unemployment, at 8.2%. This is coupled with high consumer debt, averaging $41,086. This, plus the difficult living conditions, can combine to make unemployment particularly stressful in NWT. But while qualifying for a traditional loan requires proof of income, not all loans demand this, so if you’re in financial difficulty in NWT and facing tough times you do have financing options. These usually come from alternative lenders, who may have other qualification criteria for you to meet before they approve your no income loan.
What’s the deal with payday loans in NWT?
Payday loans are not regulated in NWT in the same way as in the provinces. Instead of territory-specific rules, payday lenders only have to comply with federal laws. This means that payday lenders can charge much higher interest rates, punitive fees, and have higher lending amounts than elsewhere in the country. However, because of this many local banks and credit unions have adapted their rates and terms to eliminate the competition from predatory payday lenders. They even offer credit builder programs to provide small, short term loans to help residents build their credit score, and so become eligible for other, larger financial products. So if you’re in need of a small, short term loan, don’t assume that your bank won’t be able to help!
How is financing different in NWT than the rest of Canada?
NWT has a number of financial relief programs for its residents, aimed at helping the most vulnerable in its communities during times of need. This includes a Northern Bonus for students, an Income Assistance Program to help families afford the basics, a Child Benefit for low income families, and several Senior Citizen initiatives. This all means that residents have greater public support than in some other parts of the country, and so finding financial help via a private loan is potentially less necessary.