The Most Affordable Personal Loans in Canada

The Most Affordable Personal Loans in Canada

September 22, 2015 2878 13

Maybe you need money for a sudden emergency, everyday expenses, to pay down high interest credit card debt or to consolidate a bunch of loans.

Regardless of the reason, a promising roster of new online lenders is cutting out the middle man – banks and credit unions – and offering faster, simpler, cheaper personal loans Canada has eagerly anticipated.

With personal loans as high as $35,000 and rates as low as 5.6%, companies like Borrowell are taking on Canadian banks in the same way ING once took on bank deposits – with lower costs and greater convenience.

With loans between $300 and $10,000 lenders like Affirm Financial are offering credit where only pay day lenders used to play – at much lower rates.

In less than 2 minutes, you can apply for an installment personal loan from the comfort of your home and within seconds get approved with the rate, loan size and monthly repayment schedule, with no impact to your credit score.

Personal loans are especially convenient for larger borrowing sums, a short term cash crunch or reducing current interest rates. They also make sense if you want to make one monthly payment over a fixed term, helping you budget over the long term, without having to worry about multiple payments and accumulating interest.

The promising news? Borrowell claims it saves the average customer $5,300 in credit card interest per loan – validating Canadians are finding value.

These personal loans are designed for customers with excellent, good, average and poor credit scores. Borrowell is serving customers with credit scores as low as 660 and Affirm goes even lower.

Affirm Financial VS Borrowell

 Affirm FinancialBorrowell
Loan Size$300-$10,000$1,000-$35,000
Loan TypeMonthly InstallmentMonthly Installment
Loan Term6 months to 5 Years3 & 5 Year Terms
APR Range29.9%-39.9%5.6%-25%
Minimum Credit ScoreNot available660
Minimum IncomeEmployement or Regular Income No Min (all income is reviewed)
Funding2-4 business days24-36 Hours
Closing/Origination FeesNone1-5%
Early Payment FeesNoneNone
Get a Quote

Based on how fast & easy it is to get a quote, if you think you have a good credit score and you’re looking for a personal loan, we’d recommend getting a quote from Borrowell first. Because Borrowell performs a soft credit inquiry, there is absolutely no impact on your credit score when you get a quote.

If you get approved for a loan with an interest rate you like from Borrowell, complete the process. If you don’t get pre-approved, then you can try applying for an Affirm loan, which comes with a higher interest rate, but a better chance of approval.

The Personal Loans Canada Has Been Waiting For:

  • Fast and easy application: Borrowell offers you a personalized quote, with no impact to your credit score. It will show you the interest rate, size of the loan and payment schedule, and you’ll never need to visit a branch to complete your application.
  • Flexible financial tool: You can use your personal loan to pay off high interest credit cards, pay for major purchases, finance home improvements, fund small businesses, pay for vacations, weddings or other financial objectives.
  • Low fixed rates & payments with no hidden fees: Interest rates depend on your credit profile and risk, with rates as low as 5.6% for Borrowell to 29.9% for Affirm. Compared to credit card interest rates of 19.9%+ and payday loans with annual interest over 500%, they can offer significant savings.
  • Prepay and save: You can prepay your loan at any time, and you’ll never have to pay a prepayment fee or penalty.
  • Single, convenient monthly payment: Loan payments are automatically scheduled every month, as pre-authorized payments directly from your bank account. No checks or wire transfers, or remembering to pay each of your credit card bills.
  • Boost your credit score: Did you know that paying off your credit cards or consolidating your debt can increase your credit score? One peer-to-peer lender claims that 77% of borrowers experience an average FICO  increase 21 points within 3 months of obtaining their loan (a result of decreasing utilization rates)!
  • Get funded within 24 hours: You will receive your funds between 24 to 36 hours from Borrowell and 2-4 business days from Affirm after approval.

Once you’ve been approved for a loan and received a quote, you’ll have to verify your income to get funded.

Borrowell is really simple. They will require that you 1) scan or take a photo of your two most recent pay stubs and upload or email them. If you don’t have pay stubs, you can submit the “Notice of Assessment” from your last two tax returns. 2) Securely provide your bank account number to Borrowell’s deposit partner, VersaPay.

Affirm will actually verify your identity over the phone, making things a little simpler. They will require a copy of a void check. However, they may not require a copy of your pay stubs, depending on the strength of your application.

Approval Criteria

While we don’t know the exact approval criteria for Borrowell and Affirm, the criteria below are pretty certain disqualifiers. Borrowell has a higher standard than Affirm. The big advantage with Borrowell is that they will pre-qualify you and provide you with your rate, without impacting your credit score at all, so you might as well give them a shot first.

Disqualifying Criteria:

  • Be a Canadian citizen or permanent resident
  • Not currently in bankruptcy or consumer proposal
  • No outstanding loans with a pay day lender such as Mogo or Money Mart
  • No unpaid debts currently in collection

While personal loans can be a great option to pay off credit card debt, we’d still recommend you explore doing a balance transfer at 0% for 12 months first. However, when the 0% promotional balance transfer rate expires at the end of 12 months, or, if your balance transfer credit line is not high enough, use a personal loan to pay down the rest of your balance.

If you’ve gone through the application process or have taken a loan with Borrowell or Affirm, we’d love to hear about your experience.

Article comments

Armand G Laforest says:

Looking to bowrow 5000 for. Late payment

Trudy Wilson says:

I require a $20,000.00 loan until I sell my house.
I need to buy a house & my downpayment is close to $40,000.00. I have $20,000.00 at the moment.
Might you be able to help me with this personal loan?

GreedyRates says:

Hi Trudy,

GreedyRates does not issue loans itself. However, you can apply for a loan from one of the lenders featured on our site. Why not try to borrow from Borrowell or Grow? Better yet, do you have any available line of credit on your primary mortgage?

GreedyRates Staff

Andrew says:

Hey can i use a loan on a down payment for a house? are there any restrictions?

GreedyRates says:

Hi Andrew,

The cash is yours to do what you want with. That said, without knowing your financial situation, just make sure you have the monthly cash flow / income, to meet the monthly payments of your personal loan and your mortgage at the same time. There will be many housing expenses that may catch you by surprise if you’ve been a renter – such as municipal taxes, school taxes, possibly utilities and of course unexpected fixes. Leave yourself a little room.

GreedyRates Staff

Richard Monteith says:

I would like a 10000 dollar loan unsecured. I need the money to pay off debts.

GreedyRates says:

Hi Richard,

You will have to apply directly with one of the lenders above. Click through one of the links and get a free quote. If you get a quote at an interest rate and monthly payment you can afford, complete the application and you’re good to go!

Hope that helps,

GreedyRates Staff

Dee says:

I have had a very disappointing experience with Grouplend, now called Grow. They are not very transparent in their marketing. I got pre-approved with a personalized quote. Then I submitted all the documents they requested. Then no news from them. I emailed them and asked about the status of my application and they replied that “sorry, we cannot offer you a loan at this time”! I was dumbstruck as no where on their website do they mention that once, you have a personalized quote, you are still not certain to receive the loan. And I emailed back to ask on the basis of what was I not approved, they did not bother to reply. Very misleading! You don’t need a “hard hit” on your credit by going to Grow/Grouplend. Be careful is what I would recommend!

GreedyRates says:

Thanks for sharing your experience Dee. That does seem troubling. The whole point of the soft hit quote, is to avoid a decline that could negatively impact your credit score. Not sure what information their pre-approval/soft-quote system doesn’t capture that their final adjudication process does. Seems to be a gap their that is going to legitimately frustrate a lot of applicants.


GreedyRates Staff

Rosalie Skead says:

We would like to see if we could borrow up to 20,000 to pay off our credit cards

Rosalie Skead says:

I would like to pay off me and my husbands credit cards We need to borrow around 20,000. I am working and my husband is applying for disability

GreedyRates says:

Hi Rosalie,

We would first recommend trying to get a balance transfer credit card. A balance transfer promotional rate of 0% for 12 months with the MBNA platinum plus mastercard will be better than any personal loan or line of credit – nothing beats 0%. Of course make sure to make all your payments on time. You can only transfer up to 98% of your available credit line, so if you’re not given a high enough credit limit to transfer the entire $20,000, get a lower interest personal loan to paydown the rest.

Does that help?

GreedyRates Staff

Hyacinthe says:

You forgot to compare with Mogo, too.