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Best Debt Consolidation Loans In Canada

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Last updated on January 21, 2021

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Are you looking for the best debt consolidation loan in Canada? A debt consolidation loan is one of the best tools for people who want to get out of their debt. It can help you lower your monthly payments, keep your monthly payments more manageable, and save on your interest payments. A debt consolidation loan, if done properly, can be extremely useful and can help you pay back your debt and make you debt-free.

Continue reading to find out some of the best debt consolidation loans in Canada.

Debt consolidation loan: What is it?

A debt consolidation loan is a loan that you use to pay off your debt from previous credit card balances, overdue bills, and loans. This loan can be used for both business and private purposes. All in all, debt consolidation loans are a great way to resolve an unsteady financial situation.

Best Debt Consolidation Loans In Canada

Here are some of the best debt consolidation loans that will help you get out of your debt as fast as possible.

Loans Canada

Loans Canada

Maximum borrow amount: $50,000

Features: Get multiple offers from one application. Free to apply. Fast approval.

When can you get the funds? As early as same day

Loans Canada offers one of the fastest and easiest methods of getting any kind of personal loan. You can borrow up to $50,000 and can get the funds as early as the same day. Fill out the application once (free to apply) and get multiple offers you can choose from.

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Loans Canada is a Canadian lending portal for individuals looking for a debt consolidation loan. The best thing about this online loan platform is that it works with all kinds of credit histories and credit scores. Even if you do not have excellent credit, you can possibly find a loan provider who is ready to approve you for a debt consolidation loan within this network.

LoanConnect

LoanConnect

Maximum borrow amount: $50,000

Interest rates: As low as 4.6%

When can you get the funds? Same day

LoanConnect has one of the largest borrow amounts in Canada of up to $50,000. They don't directly fulfill the loans themselves, but they work with dozens of different lenders in Canada to provide Canadians with the best offers. As a result, you can get interest rates as low as 4.6% and get access to your funds within the same business day.

Learn more

LoanConnect is a search engine that helps you find the best rates and debt consolidation loans possible. The loan amount ranges from $500 to $50K. The annual interest rate starts at 10%. It is a good idea to search with this search engine if you are searching for a debt consolidation loan. LoanConnect is painless, free, and fast.

Besides, since it works with various loan lenders, you are more likely to find a debt consolidation loan that works for you. What’s more, the online platform uses advanced security programs to protect your financial data. It sends out your information only to those loan providers who match your profile. The search engine sends information via an encrypted channel and only available at that specific time.

LendingMate

This lender provides easy application, quick approval, and less strict eligibility needs. This makes it a good choice for individuals who have bad credit. However, it is important to note that their interest rates are slightly greater than other lenders with stricter eligibility needs. The lender works with guarantors, people who co-sign on your debt consolidation loan and agree to pay back your debt should you fail to make repayments.

The loan amount ranges from $2,000 to $10,000. The lender charges an annual interest rate between 34.9% and 43%. The best part is that the lender will not charge you for making larger payments; therefore, you can complete your debt consolidation loan repayment plan earlier.

Ferratum

Established in 2005, Ferratum is a well-known debt consolidation loan company in Canada. The loan amount ranges from $500 to $15,000. The annual interest rate starts from 18.9%. The lender usually approves and deposits the debt consolidation loans within 24 business hours. The best part is that the lender will not charge you for prepayments. And you will receive a payout fast once your debt consolidation loan is approved.

To qualify for the debt consolidation loan, you should have a credit score of 600, be more than 20 years old, earn $2,500 every month while employed full-time for 90 days before applying.

Borrowell

If you have a good credit history and a credit score, Borrowell is perfect for you. Founded back in 2014, Borrowell offers credit monitoring services and debt consolidation loans to Canadians. The lender will provide you low-interest rates if you can fulfill the eligibility requirements. It offers a loan amount of up to $35,000 and charges an annual interest rate between 5.6% and 29.9%.

Above all, the lender offers credit monitoring that allows you to view your credit score and monitor it each month. The credit monitoring service is useful if you are thinking about taking out a debt consolidation loan and are unsure that your credit score is good enough to be eligible for the lowest available rates.

Tips to select the right lender and debt consolidation loan

With so many different kinds of debt consolidation options, it can be difficult to determine which loan is right for your situation. The terms of the loan will be a perfect indicator of whether or not it is the right kind of debt consolidation loan for you. Here are some of the features you should consider when looking for a debt consolidation loan.

Fees

You should know about all the fees involved and compare them alongside the annual percentage rates. It is important for you to know that a high prepayment penalty and a high origination fee found in the contract will cancel out a low-interest rate.

Loan amount

Some lending institutions are ready to give you big amounts, while other loan providers will cap the amount you can borrow. Therefore, you should look for a lending institution that works with your debt requirements.

Annual percentage rate

It is the interest rate you will pay all year long on your debt consolidation loan. The greater the annual percentage rate, the more interest you pay.

When are debt consolidation loans the best option?

Debt consolidation loans may not be the best solution for all. However, if you are ready to repay the loan responsibly and have many kinds of debt, a debt consolidation loan is the right option to handle everything simultaneously.

Tips to get a debt consolidation loan

Taking out a debt consolidation loan is extremely easy.

  1. First, you should compare loan providers or lending institutions. Then, you need to take into account how stringent their policies are for failing to make a payment, accessibility to company representatives, interest rates, and how disciplined you will have to be in paying back the debt consolidation loan.
  2. After that, you should apply for a debt consolidation loan online from the loan provider who suits your requirements.
  3. You should wait for the lending institution to approve your loan.
  4. Get your funds and use them to pay off your current debts.
  5. Establish a method of making payments every month toward your new loan.

Frequently asked questions about debt consolidation loans

Are these loans safe?

A debt consolidation loan is safe as long as you are able to repay your loan on time. However, loans that are based on security are risky because if you fail to make payments, you risk losing your valuable asset. On the other hand, if you apply for an unsecured loan and pay back your loan on time, debt consolidation is safe.

Will your credit score be affected by debt consolidation loans?

A debt consolidation loan may hurt your credit score if you fail to make monthly payments on your debt consolidation loan, or continue carrying a credit card balance from one month to another. But it is worth knowing that a debt consolidation loan can improve your credit score if you carefully manage your personal loan, decrease your debt, and repay your loan on time.

Can you get a debt consolidation loan even if you have a bad credit score?

There are several loan providers in Canada that will work with those who have poor credit. As a matter of fact, there are lending institutions or loan providers in Canada that are ready to help people who have undergone financial hardships. However, it is important to note that a poor credit score might make your interest rates soar.

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