With mountains and beaches, rainforests and islands, and tens of thousands of miles of gorgeous coastline, British Columbia has a lot going for it. All these features and then some may be why you chose to make BC your home. The province’s stable economy doesn’t hurt either. In fact, due to its stability, residents have access to various types of financing with favorable terms and rates, including personal loans.
Applying for personal loans in BC is fast and simple, as most lenders now use online applications. When you use LoanConnect’s loan search engine, you can simplify the process even more. We scan our database for the most competitive matches that are most likely to suit your needs. You can compare lenders, terms and rates all from the comfort of your own home. Only once you feel confident in an offer do you submit the official application and undergo a credit check.
At LoanConnect, it is our mission to match aspiring borrowers with Canada’s most trustworthy and reputable lenders. We want borrowing to be affordable and accessible to all, which is why we carefully vet our lenders and eliminate any who don’t share our values. When you search for a personal loan through us, you assume control of your financial future.
Who Qualifies for Personal Loans in British Columbia?
Eligibility criteria for personal loans vary vastly from lender to lender and borrower to borrower. However, borrowing from a larger, more traditional institution, may require a credit score of at least 650. You may also have to prove you have a healthy debt-to-income ratio and a low to non-existent bankruptcy ratio.
If you want the best rates, your score may have to be significantly higher, at around 740 or above. However, several private lenders are willing to lend to subprime borrowers with scores of around 550. But, if you do not want to be stuck in a cycle of costly debt, you should wait until your score is at least 600 to apply.
What Can You Use Personal Loans For?
The great thing about personal loans is that you can use them for just about anything. Many people only turn to personal loans for major expenses, such as buying a car, home renovation or tuition costs. However, personal loans in BC can be used to cover medical bills, or other unplanned expenses; or simply used to increase your spending capacity during a notoriously expensive time of year.
What Are the Average Interest Rates for Personal Loans in BC?
Several factors affect the interest rates borrowers receive on personal loans, including credit score, employment status and debt-to-income ratio. However, the average rate range on personal loans in Canada is between 9.30% and 22.16%. Of course, this range changes between credit score tiers, with average rates as follows:
- 760 or higher: 9.30% APR
- 720 to 759: 13.32% APR
- 680 to 719: 17.82% APR
- 640 to 679: 22.16%
If your credit score is lower than 640, or you don’t have credit history, your APR may exceed 30.00%. However, know that interest rates on personal loans cannot exceed 60% in Canada.
Can a Personal Loan Help You Build Your Credit?
In many cases, yes, a personal loan can help to improve your credit score. For instance, personal loans contribute to your credit mix, which accounts for about 10% of your FICO score. If you use a personal loan to consolidate credit card or medical debt, it can help reduce your utilization ratio, which accounts for 30% of your credit score. Finally, if you make payments on time, you can establish a positive payment history, which accounts for 35% of your credit score.
However, as with any type of debt, a personal loan can adversely affect your credit score if used irresponsibly. If you borrow more than you can afford, default on your payments or apply for one loan after another, you could cause damage that may take months or even years to repair.
Do You Need Collateral To Get a Personal Loan?
In most cases, no, personal loans do not require collateral. This means the lender will not require you to put your home, vehicle or other assets up as insurance in the event that you default. This protects your assets against any legal claims that may arise as a result of your lender/borrower relationship. However, if you do default, the lender can sue you for the amount owed and/or garnish your wages.
How Long Does It Take To Receive Funds From Personal Loans in British Columbia?
If you apply with a major bank, the approval process can take anywhere from two to four days to complete. After that, it may take the bank another five business days to distribute your funds.
When you go through an online lender, such as the ones we partner with at LoanConnect, the process is much quicker. In some cases, applicants obtain approval in as little as five minutes. In almost all situations, borrowers receive their funds within 24 hours of submitting the application. Personal loans are a great source of funding for individuals who need financial assistance. If you think a personal loan is right for your situation, begin the application process today.