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- Car loan:<\/strong> Financing specifically for the purpose of purchasing a vehicle<\/a>. Interest rates for this type of loan generally range between 3% and 15%.<\/li>\n<\/ul>\n
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- Student loan:<\/strong> Can cover education expenses and is available from the government and private lenders.<\/li>\n<\/ul>\n
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- Personal loan:<\/strong> Can be put towards any kind of expense and often used to consolidate debt. Personal loans can be secured<\/a> (backed by collateral) or unsecured<\/a> (rely on your credit rating).<\/li>\n<\/ul>\n
You can get an instalment loan from:<\/p>\n
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- Traditional banks: <\/strong>This is an excellent place to start if you have good credit. If you need an instalment loan, visit your personal bank first as they may have low interest rates for current customers.<\/li>\n<\/ul>\n
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- Credit unions: <\/strong>Credit unions typically offer better rates than traditional banks. Keep in mind you\u2019ll need to become a member of the credit union to take advantage of its products.<\/li>\n<\/ul>\n
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- Online lenders:<\/strong> Trusted online lenders are emerging as the best option if your credit isn\u2019t great and you need money quick. You can shop around for the best rates and apply for a loan from the comfort of home.<\/li>\n<\/ul>\n
What are the benefits of instalment loans?<\/h2>\n
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- Predictable monthly payments: <\/strong>Credit cards can be hard to manage as the amount on your statement can change depending on how much you spend. With instalment loans, your payments stay the same so you know exactly how much you owe every month. This offers more predictability and makes it easier to budget. Most instalment loans also use fixed interest rates which provide peace of mind as you don\u2019t have to worry about the rate increase.<\/li>\n
- Flexible payment schedules: <\/strong>Customizable repayment plans give you flexibility and freedom. You can pick a longer term if you want to make lower monthly payments or agree to a shorter period to save on interest.<\/li>\n
- Quick access to funds:<\/strong> You\u2019ll most likely need money fast when a financial crisis hits. Lenders understand this which is why funds are normally released within 24 hours or less upon approval.<\/li>\n
- Relaxed eligibility requirements: <\/strong>It\u2019s easy to qualify for an instalment loan in Canada with a trusted lender, especially online. You need to be a Canadian resident, at least 18 years of age, possess an active bank account, and have proof of your income, residence, and expenses.<\/li>\n
- Credit building:<\/strong> Unlike payday loans<\/a>, instalment loans can help you build credit if you use them wisely. Every on-time payment will be reported to the credit bureaus and this activity will help boost your credit score.<\/li>\n<\/ul>\n
How can an instalment loan help my credit rating?<\/h2>\n
According to the Equifax credit bureau, the five main factors involved in calculating a credit score are payment history, credit utilization, credit history, inquiries, and public records.<\/p>\n
![\"\"](\"http:\/\/wp.springfinancial.ca\/wp-content\/uploads\/2023\/09\/60ea1eb98f3cc.png\")
<\/p>\n - Flexible payment schedules: <\/strong>Customizable repayment plans give you flexibility and freedom. You can pick a longer term if you want to make lower monthly payments or agree to a shorter period to save on interest.<\/li>\n
- Predictable monthly payments: <\/strong>Credit cards can be hard to manage as the amount on your statement can change depending on how much you spend. With instalment loans, your payments stay the same so you know exactly how much you owe every month. This offers more predictability and makes it easier to budget. Most instalment loans also use fixed interest rates which provide peace of mind as you don\u2019t have to worry about the rate increase.<\/li>\n
- Online lenders:<\/strong> Trusted online lenders are emerging as the best option if your credit isn\u2019t great and you need money quick. You can shop around for the best rates and apply for a loan from the comfort of home.<\/li>\n<\/ul>\n
- Credit unions: <\/strong>Credit unions typically offer better rates than traditional banks. Keep in mind you\u2019ll need to become a member of the credit union to take advantage of its products.<\/li>\n<\/ul>\n
- Traditional banks: <\/strong>This is an excellent place to start if you have good credit. If you need an instalment loan, visit your personal bank first as they may have low interest rates for current customers.<\/li>\n<\/ul>\n
- Personal loan:<\/strong> Can be put towards any kind of expense and often used to consolidate debt. Personal loans can be secured<\/a> (backed by collateral) or unsecured<\/a> (rely on your credit rating).<\/li>\n<\/ul>\n
- Student loan:<\/strong> Can cover education expenses and is available from the government and private lenders.<\/li>\n<\/ul>\n