The best debt consolidation loans in Canada help you manage your payments better and save money. Banks and credit unions offer debt consolidation to people with good to excellent credit. They’re a strong option if your finances are in good shape. If you can’t or don’t want to qualify with a traditional lender, however, you can turn to alternative lenders.
This guide focuses on alternative lenders that offer some of the best debt consolidation loans in Canada.
10 best debt consolidation loans in Canada
1 - 10 of 10
How we found the best debt consolidation loans
Finder experts collected more than 70 points of data for more than 60 lenders operating in Canada. Finder used this data to create a proprietary weighting formula that scores each lender based on rates, fees, terms, loan amounts, application process, funding speed, customer support, and reputation, among other features. The providers shown on the best list are those who scored highest based on this data-driven methodology. They are providers that are available and not available through Finder, with partners listed first. These loans are not representative of the entire market. Read more about the Finder personal loan ratings and review methodology.
We also completed the Finder: Personal Loans Best-in-Class Awards 2024 and the Finder: Personal Loans Customer Satisfaction Awards 2023, which recognize the top personal loan lenders in Canada.
Learn more about each loan, including why it won, where it’s available and what to watch out for.
1. Fig
Fig offers unsecured personal loans to prime borrowers, which you can use to consolidate debt.
Suited for: Borrowers with good to excellent credit
Why it’s one of the best
Competitive rates. Fig’s rates start at 8.99%, which is competitive against other lenders in its category.
Easy digital process. Fig offers borrowers an easier online application process than many financial institutions. The process is fully digital and doesn’t require a phone call with an agent, unlike many other lenders.
Fast. Get a pre-approval offer within minutes without affecting your credit score. Once you’ve submitted your loan contract, you can get your money within two business days.
Eligibility requirements: Min. income $5,000/month, 6+ months employed, min. credit score 700
Accepts bad credit: No
Where it’s available: Alberta, British Columbia, Manitoba, New Brunswick, Northwest Territories, Nova Scotia, Ontario, Prince Edward Island, Quebec, Saskatchewan
Rate is guaranteed for seven days
No fees aside from a $45 NSF fee
Flexible repayment options
Fair or bad credit may not qualify
2. Spring Financial
Spring Financial is one of the more established direct alternative lenders in Canada. Its primary product is its unsecured personal loan, which you can use for debt consolidation.
Suited for: Borrowers with low credit looking for fast approval and funding
Why it’s one of the best
High loan amounts. Borrow as much as $35,000, which is high for an online lender of unsecured loans.
Low starting rate. Rates start at 9.99%, which is competitive against others in its category.
Fast and easy. Fill out an online application in less than 10 minutes, get a response right away and get your money as soon as the same day. E-transfer funding is available.
Loan types: Secured and unsecured debt consolidation loans
Eligibility requirements: Min. income of $2,000 /month, 3+ months employed
Accepts bad credit: Yes
Where it’s available: All of Canada
Simple online application
Experienced lender
Flexible loan amounts
No prepayment penalties
Widely available
High rates for bad credit
3. LoanConnect
LoanConnect is an online loan search platform. It maintains a large database of lenders that can finance borrowers with good or bad credit. Lenders are generated based on your unique profile.
Suited for: All types of borrowers who want to compare offers
Why it’s one of the best
Get more than one offer. It’s possible to get multiple offers depending on the strength of your profile. From there, you can choose the best debt consolidation loan for your situation.
Low starting rate. LoanConnect’s rate starts at 8.99%, which is competitive.
Options for all credit. You can apply even if your credit score is low. LoanConnect is partnered with lenders who work with bad credit borrowers.
Loan types: Secured and unsecured debt consolidation loans
Eligibility requirements: Steady source of income
Accepts bad credit: Yes
Where it’s available: Across Canada
Funding in 24 to 48 hours
Get your matches within minutes
BBB accredited
Not a direct lender
High rates for bad credit
5. SkyCap Financial
SkyCap Financial is an online private lender that provides debt consolidation loans.
Suited for: People with fair to bad credit who want friendly, professional customer service
Why it’s one of the best
Great service. SkyCap is well known for offering friendly and professional customer service.
Flexible. Instead of fixating on your credit score, it takes a more holistic approach to approving applications by looking at factors such as your credit history, employment and income.
Fast decisions. SkyCap offers near-instant loan decisions with official approval in as little as 24 hours.
Eligibility requirements: Min. monthly income of $1,666.67, full time employment/pension, min. credit score of 575
Accepts bad credit: No
Where it’s available: All provinces and territories except Quebec and Nova Scotia
BBB accredited
Lower starting rate than other alternative lenders
No prepayment fees
Exclusive financial literacy course
High rates for bad credit
Higher rates than traditional lenders
May not improve your credit score
6. goPeer
goPeer is an online P2P lending platform that connects Canadians looking for a loan with other Canadians looking to lend money. Borrow up to $35,000 with goPeer’s online loans to repay your debt.
Suited for: People with good to excellent credit looking for competitive rates
Why it’s one of the best
Competitive rates. goPeer is a peer-to-peer network that strives to offer better interest rates than the competition. It offers low-cost loans to borrowers with strong finances. Since it operates online, goPeer also cuts down on operating costs and transfers those savings back to borrowers.
Regulated. goPeer is subject to the provincial laws where it funds loans, and on the federal level, it is subject to statutes enforced by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC).
Fully online. You don’t need to leave your home to get a debt consolidation loan from goPeer.
Eligibility requirements: Min. income of $35,000/year, min. credit score of 700
Accepts bad credit: No
Where it’s available: All of Canada
15-day grace period for unexpected events
Anonymous application
Secure platform
No prepayment penalties
High credit score required
Rates as high as 34.99%
Origination fee baked into APR
If your finances aren’t strong, you may not get the amount you want
7. Mogo
Apply for a Mogo Personal Loan of up to $35,000 with terms ranging from 6 - 60 months.
Suited for: People looking to get quick online quotes with no impact to credit
Why it’s one of the best
Money-back guaranteed of 100 days. Mogo offers a unique perk to eligible borrowers: If you change your mind, you can return your principal within 100 days and get your paid interest and fees back.
Easy process. Get a quote within minutes without affecting your credit score. If you choose to proceed, get your money as soon as the same or next business day.
Options for good and bad credit. Whether your credit score is great or isn’t great, Mogo has loan options available.
Eligibility requirements: Min. income of $35,000 /year, min. credit score of 600
Accepts bad credit: Yes
Where it’s available: BC, AB, SK, MB, ON, NB, NS, PE, NL, YT, NT, NU
Low starting rates
Free quote with no impact on credit score
Funding in one to three business days
Repay loan anytime without penalty
What to watch out for
High rates for bad credit
Some negative Mogo reviews online
Not all borrowers are eligible for the 100-day trial
8. easyfinancial
easyfinancial is one of the biggest and most well-known alternative lenders in Canada. It offers debt consolidation loans online and in hundreds of branches across Canada. It has been in business since 2006 and its parent company, goeasy, is listed on the Toronto Stock Exchange.
Suited for: Borrowers with bad credit looking to consolidate high-interest loans
Secured and unsecured options. People with fair to bad credit can apply, and you can secure your loan to increase your chances of approval and lower your rate.
Streamlined process online or in person. Apply online and get your money as soon as the same day, or walk into one of easyfinancial’s hundreds of locations.
APR: 9.99% - 35.00%
Loan amount: $500 – $100,000
Loan term: 9 - 240 months
Loan types: Unsecured debt consolidation loans
Eligibility requirements:
Accepts bad credit: Yes
Where it’s available: all provinces
BBB accredited with an A+ rating
Fast approval and funding
Rebuilds credit score
2% rate reduction with a co-applicant
Could lose your home if you default on a secured loan
Steep interest rates
9. Fairstone
Fairstone provides secured and unsecured personal loans that you can use for debt consolidation. It’s one of the biggest alternative lenders in Canada and is owned by Fairstone Bank of Canada, a Schedule 1 bank.
Suited for: People with fair credit looking for quick quotes
Why it’s one of the best
Established lender. Fairstone is an established direct lender, having been around for almost 100 years. It is widely available in Canada, and you can apply online or in person.
Secured and unsecured options. When you apply to Fairstone, you can choose between a secured and unsecured debt consolidation loan.
Fast quote. Get a no-obligation quote within minutes when you apply.
APR: 19.99% - 34.99%
Loan amount: $500 – $60,000
Loan term: 6 - 120 months
Loan types: Unsecured debt consolidation loans
Eligibility requirements: , min. credit score of 525
Accepts bad credit: No
Where it’s available:
Completely online
Get funding in 24 to 48 hours
Get a loan offer with no impact on credit score
Homeowners preferred
Higher rates for lower credit scores
Secured loans require a visit to the branch
10. Magical Credit
Magical Credit is an online-only private lender offering installment loans of up to $20,000. It has been providing loans since 2014 and has offices in Concord, Ontario, and North York, Ontario. Magical Credit doesn’t do direct debt consolidation, but you can still use its loan to pay off your smaller debts.
Suited for: People with fair to bad credit receiving regular non-employment income
Why it’s one of the best
Flexible eligibility requirements. You can apply with bad credit, and Magical Credit is open to many non-employment incomes, such as employment insurance, CPP, OAS, child tax credit and private disability benefits. To increase your chances on a debt consolidation loan, however, it’s better to have employment income in addition to your non-employment income.
Flexible loan amounts. Borrow $1,500 to $20,000.
Easy online application. Speed up the process via instant bank verification, which requires little to no documents.
APR: 19.99% - 46.80%
Loan amount: $1,500 – $20,000
Loan term: 12 - 60 months
Loan types: Unsecured debt consolidation loans
Eligibility requirements: Min. income of $1,200 /month
Accepts bad credit: Yes
Where it’s available: Canada-wide (excluding Manitoba, Saskatchewan and Quebec)
Minimal to no documents required
A+ BBB rating
High interest rates for bad credit
Must not have active payday loans
How to get the best debt consolidation loan in Canada online
Compare lenders. Compare several features such as interest rates, fees, loan amounts, loan terms and eligibility requirements.
Apply to your best picks. Fill in the online applications to get personal loan pre-approval. You’ll need to provide personal details such as your name, contact information, housing information and employment. If you want to get multiple offers via one application, apply to a loan broker.
Compare offers. Compare quotes and choose the best offer.
Submit documents. If required, submit documents to your top choice to verify your income and identity.
Get approved. Get an official loan offer. Review the contract carefully, making sure you’re aware of how much the debt consolidation loan may cost you overall.
Get funded. Your debt consolidation lender will pay out your creditors, and you’ll make repayments to the lender.
Plans to get a debt consolidation loan in 2023
According to data released in the Finder: Consumer Sentiment Survey, fewer Canadians are focused on managing their debt with 3% planning to take out a debt consolidation loan in the third quarter of 2023, compared to 17% in the second quarter of 2023.
How to compare the best consolidation loans in Canada
To find the best debt consolidation loans, compare the following features:
Interest rates
Get an annual percentage rate (APR) that’s lower than what you’re currently paying for all your debts. If, for example, you’re paying 20% APR on credit card debt, and are offered a debt consolidation loan with a 39% APR to pay off that debt, you’ll pay more with the debt consolidation loan. That’s why it’s important to carefully compare the best debt consolidation offers and not simply assume you’re getting a better deal on a new loan.
APR is the annual interest rate plus fees you must pay to get the debt consolidation loan. Some lenders advertise the annual interest rate separately from the fees, but you should instead look at the APR so you know the total cost of the loan. Compare personal loan rates in Canada.
Fees
The best debt consolidation loans have little to no fees. Watch out for fees to process your loan, such as origination or admin fees, which may be included in the APR. Also look out for NSF fees ($25 to $50 is common), late payment fees (fixed dollar amount or a percentage of the outstanding payment), loan insurance and prepayment penalties (uncommon for debt consolidation loans).
Loan amounts
Choose a lender that can approve the amount you need. Lenders differ in how much they can offer a borrower. If you find that you can’t get approved for the full amount you need to consolidate your debt, it may still be worth consolidating even a part of it. Remember that the goal of getting the best debt consolidation loan is to save money and pay off your debt faster. Even a smaller consolidation loan can help accomplish that.
Loan terms
When deciding on the best debt consolidation loan in Canada for your needs, you’ll need to find the balance between monthly payments and the shortest loan term you can afford. Even if a long loan term and smaller monthly payments may seem appealing, you could end up spending a lot more money in interest in the long run.
Eligibility requirements
If you have fair or bad credit, focus on lenders that specialize in loans for your credit score. Many of the best lenders listed in this guide also offer bad credit debt consolidation loans in Canada, including Loans Canada, SkyCap Financial and LoanConnect. If you have good to excellent credit, focus on lenders that offer low-interest loans.
Reputation and customer service
Lenders of the best debt consolidation loans will not pressure or rush you to sign and will make sure you understand the terms of your loan.
Improves credit score
The best debt consolidation loans will increase your credit score as you make on-time payments. Prioritize lenders that report payments to the credit bureaus.
Secured vs unsecured
An unsecured debt consolidation loan is the more common way to consolidate debt, but some lenders also offer secured debt consolidation loans.
Pros and cons of a debt consolidation loan
Pros
One payment. Easily track your expenses and never miss a deadline with one easy-to-manage payment.
Save on interest. The best debt consolidation loan in Canada for you will come with a lower rate than what you currently pay.
Boost your credit. Pay off all of your debts and make on-time payments on your new loan to increase your score.
Earlier payoff. Depending on your term and APR, you may find it’s faster to pay off your debts with a fixed monthly payment (instead of a minimum payment).
Cons
Does not eliminate debt. Even if you get the best debt consolidation loan, you’re shifting existing balances to a new loan.
Can hurt your credit. Using a debt consolidation loan to pay off credit cards or lines of credit could leave you to overspend and default on your payments.
No intro period. Unlike balance transfer credit cards, debt consolidation loans don’t offer low or 0% interest intro periods.
Potentially higher monthly cost. A loan might get you out of debt faster but repayments are often higher than the monthly minimum on your credit card.
Less flexibility. Your new loan will have a fixed monthly payment instead of a monthly minimum repayment like credit cards.
What are the requirements of a debt consolidation loan?
Requirements vary by lender but you typically need to meet the following criteria:
Criteria
Sample of documents required
Canadian citizen/resident and the age of majority in your province (18 or 19 years old)
Government-issued ID, like a passport or driver’s licence
Meet minimum income requirements
Pay stubs, bank statements, tax returns
Meet minimum credit score requirements
Consent to have your credit score checked and provide your Social Insurance Number in some cases
Active bank account
Direct deposit information
Are there guaranteed consolidation loans in Canada?
No. Steer clear of lenders offering guaranteed consolidation loans in Canada because this could be a scam. Legitimate lenders will first take a look at your finances before approving.
You can increase your chances of getting approved for a debt consolidation loan if you offer collateral or have a guarantor or cosigner, but if you’re facing legitimate financial hardship and struggling to keep up with your debts, you may want to look into debt relief options.
The results of the Finder: Consumer Sentiment Tracker Q3 (CSTQ3) were collected through an online Pollfish survey conducted between August 10 to 21, 2023. In the survey, 1,013 Canadians from across the country were asked about their current debt obligations, among other questions regarding money goals and financial confidence. The estimated margin of error for the survey is +/- 3%, 90% of the time.
The results of the Finder: Consumer Sentiment Survey Q2 (CSTQ2) were collected through an online Pollfish survey conducted between April 27 and April 29, 2023. In the survey, 1,011 Canadians from across the country were asked about their past use and current plans to use personal loans and other forms of credit. The estimated margin of error for the survey is +/- 3%, 19 out of 20 times.
Frequently asked questions
Consolidating debt can be a good idea if you get a lower interest rate than what you're currently paying. The best debt consolidation in Canada will help you save money, not just get you an easy-to-manage payment.
It depends on which lender you apply with. Some lenders have strict eligibility criteria that can make it difficult to qualify if you have a low credit score or a low/less traditional form of income. Others are more lenient and will accept bad credit in exchange for higher interest rates. Learn more about debt consolidation loans for bad credit.
Yes, debt consolidation loans are common loan products. You can get a debt consolidation loan from the big banks, such as RBC, BMO and TD. You can also get a debt consolidation from credit unions, such as FirstOntario and Vancity.
ATB, BMO and Laurentian Bank are some of the best banks for debt consolidation. This is based on our Finder: Best-in-Class Awards methodology.
Yes and no. When you apply for a debt consolidation loan, your score may go down temporarily when your lender checks your credit. However, the overall effect of debt consolidation should be positive if you make on-time payments and change your spending habits.
You can definitely use your credit card after debt consolidation, but you should be careful to avoid overspending. Keep your credit card balance low to avoid taking on more debt than you can afford.
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To make sure you get accurate and helpful information, this guide has been edited by Romana King as part of our fact-checking process.
Leanne Escobal is a publisher for Finder. She has spent over 11 years working with financial products and services, specializing in content and marketing. Leanne has completed the Canadian securities course (CSC®) as well as the personal lending and mortgages course by the Canadian Securities Institute. She has a Bachelor of Arts (Honours) in English literature and creative writing from Western University. See full bio
Claire Horwood was a writer at Finder, specializing in credit cards, loans and other financial products. She has a Bachelor of Arts in Gender Studies from the University of Victoria, and an Associate’s Degree in Science from Camosun College. Much of Claire’s coursework has focused on writing and statistics, with a healthy dose of social and cultural analysis mixed in for good measure. In her spare time, Claire enjoys rock climbing, travelling and drinking inordinate amounts of coffee. See full bio
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