Get an Installment Loan in Ontario

Getting an installment loan in Ontario is a fast and easy process. With online lenders, getting approved for an installment loan can be done in just a few minutes by filling in a simple online application and scanning a few documents. Approval can take just a few hours and funds are often deposited within a day or two. 

Preparing any necessary documents ahead of time can help speed up the approval process. Some of the documents lenders in Ontario ask for include:

• Valid form of ID: For example, an Ontario driver’s license

• Proof of residency: For example, utility bills or a tenancy agreement

• Proof of employment and income: For example, bank deposit slips, bank statements, or a letter of employment

• Social Insurance Number

Not sure where you should apply? Use Borrowell to quickly compare loans, rates, and lenders that you are likely to qualify for based on your credit profile.

In Ontario, lenders are bound by Canadian law limiting interest rates to no more than 60%. Interest rates on installment loans in Ontario range from 3-50% depending on loan amount and loan terms.

Traditional personal loans can be out of reach for borrowers with bad credit. But with more relaxed criteria, even applicants with bad credit can get an installment loan in Ontario. By comparing lenders online, borrowers can secure an installment loan, however the range of offers may be more limited and interest rates might be less favourable.  

Credit scores over 660 have the best chance of getting approved for loans. If your credit score is below 660, there are still installment loan options available. Sign up for Borrowell to see what loan options are available based on your credit score.

Borrowers in Ontario get installment loans for a wide range of financial needs. The flexibility of installment loans is attractive, offering a variety of amounts and term lengths, so borrowers are likely to find an offer that suits their unique needs. 

Some ways that installment loans are used for in Ontario include:

• Debt consolidation

• Car purchases

• Home improvement projects

• Bills or taxes

• Vacations and travel 

• Milestone events

• Car, home, or appliance repairs

• Funding large purchases

When managed properly, an installment loan can help you improve your credit score. 

Paying down an installment loan contributes to your payment history, which over time can help raise your credit score. Of course, this depends on whether you’re able to make on-time payments towards your loan or not.

Installment loans contribute to a diversified loan portfolio. Instead of using more revolving debt, like credit cards, installment loans demonstrate a diverse credit mix which can also improve your credit score over time. 

Another way that an installment loan in Ontario can improve your credit score is by lowering credit utilization. Reducing credit utilization below 30% can increase credit scores, so using an installment loan to consolidate and manage other types of debt can significantly improve your financial health.

To track your credit score progress, sign up for Borrowell and see your credit score improve over time.

It’s important to understand the differences between secured and unsecured loans. While it is possible to find a secured installment loan in Ontario, most alternative and online lenders offer unsecured loans. Secured loans require that borrowers offer collateral as insurance against defaulting on loan repayment. Collateralized loans include mortgages and car loans. While these types of loans typically have lower interest rates, they can be hard for borrowers with bad credit to secure. 

Unsecured installment loans in Ontario do not require collateral. Instead, lenders charge a higher interest rate to make up for their increased risk.

One of the popular uses for installment loans is to consolidate debt. Having many small, high interest debts can quickly become unmanageable. Installment loans offer lower interest rates and set repayment terms, making it easier to keep track of finances and improve credit health. 

Consolidating debt into one loan lets borrowers know exactly what the total loan cost will be and what they will be required to pay at each installment.

Installment loans in Ontario give borrowers a set amount of money that is repaid in weekly, biweekly, or monthly installments. The installment amount is usually a fixed amount consisting of both principal and interest according to the agreed upon interest rate. With credit cards, borrowers can repay whatever they have spent in full and not be charged interest, however if less than the full balance is repaid, interest is charged. Interest on credit card debt is also compounded, so the longer the total balance goes unpaid, the more the borrower will have to pay.

Installment loan terms in Ontario are limited in term, with most loans ranging from 6 months to 5 years. Credit cards, on the other hand, are a form of revolving debt. Borrowers are not limited to any term. Instead, as long as credit card holders don’t reach the established credit limit, they can continue borrowing.

Payday loans are generally very short term, as the name implies. Most must be repaid within one month. Installment loans, on the other hand, are more long term, ranging from 6 months to 5 years.  

Installment loans also offer larger loan amounts. While payday loans are often for just a few hundred dollars, installment loan amounts can go as high as $35,000.

While payday loans are repaid in full, installment loans are paid back over time. Installment schedules are widely varied, giving borrowers more choice.  

Payday loans are known for very high interest rates and fees. Installment loan lenders in Ontario charge a range of interest rates, but borrowers will likely find them to be much lower than payday loans.

nstallment loan lenders in Ontario offer borrowers flexible loan repayment schedules and terms. Loans can be paid weekly, biweekly, or monthly, and loan terms vary widely. The cost of the loan and the amount that a borrower will have to pay back at each installment is determined by the loan amount, agreed interest rate, and loan term. 

Borrowers can conveniently set up payments to be automatically withdrawn, or can pay installments manually. An added benefit of installment loans is that many lenders let borrowers pay down installment loans quicker without penalty.