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What counts as “bad credit” in Canada?
Credit scores in Canada range from 300 to 900. Generally, a score below 660 is considered subprime, and below about 560 is poor. With a lower score you can still borrow — but you’ll usually pay a higher interest rate to offset the lender’s risk.
Can you get a personal loan with bad credit?
Yes. Alternative and online lenders look beyond your credit score and assess factors like:
- Your monthly income and how stable it is
- Your employment status
- Your existing debt and monthly obligations
- Whether you have a co-signer or collateral
Some lenders offer smaller amounts (for example up to $2,000–$5,000) with automated approval and fast e-Transfer funding, which is a common starting point for bad-credit borrowers.
What rates and amounts to expect
Bad-credit personal loans typically carry higher APRs — often in the 25% to 47% range — and smaller limits than prime loans. Always confirm the full cost: the APR, any fees, and the total you’ll repay over the life of the loan.
How to improve your approval odds
- Add a co-signer with stronger credit to lower your rate.
- Apply for less — request only what you truly need.
- Show steady income with recent pay stubs or bank statements.
- Consider a secured loan using a vehicle or savings as collateral.
- Fix report errors — check your free credit report and dispute mistakes.
Watch out for predatory lending
Be cautious of any “lender” that asks for an upfront fee before funding, guarantees approval regardless of your situation, or pressures you to act immediately. Reputable lenders disclose the APR and total cost clearly before you sign. Payday loans, while easy to get, carry extremely high costs and should be a last resort.
How to apply
- Gather proof of income, ID and your banking details.
- Use a comparison service to match with bad-credit-friendly lenders.
- Submit one application and review the offers you receive.
- Pick the lowest total cost you can comfortably repay.
Frequently asked questions
What’s the minimum credit score for a personal loan in Canada? Some lenders have no hard minimum and focus on income instead, though rates rise as scores fall.
Will applying hurt my credit? Pre-qualification usually uses a soft check; a full application may trigger a hard inquiry.
Can a loan help rebuild my credit? Yes — making every payment on time builds a positive payment history over time.
Bad credit? You still have options. See lenders that may approve you →
Disclaimer: LoanWave.ca is an affiliate / comparison website. We are not a lender and do not provide loans. We may earn a commission from partners. Rates and terms are set by lenders. Informational content only, not financial advice.