Using a Personal Loan for Debt Consolidation
Juggling several credit cards or high-interest debts each month makes it easy to lose track of what you owe and pay more in interest than necessary. A debt consolidation loan combines those balances into one fixed payment, often at a lower overall rate. It's one of several reasons Canadians borrow that we cover in detail.
What It Typically Covers
- Multiple credit card balances
- Existing high-interest personal loans
- Store cards and line-of-credit balances
- Overdraft or collections balances
Eligibility Requirements
- 18 years or older (19 in BC, NB, NL, NS, NT, NU, and YT)
- Canadian citizen or permanent resident
- Valid Social Insurance Number (SIN)
- Active bank account in your name
- A regular source of income
How Much Do You Typically Need?
For debt consolidation, borrowers often look at around $5,000 — though the right amount depends on your specific situation.
Pros
- Fast approval — often within minutes
- Soft credit check only, so checking rates doesn't hurt your score
- Repayment term sized to the amount, keeping payments manageable
- Available to a wide range of credit profiles
Things to Consider
- Compare the new loan's APR against the weighted average of your current debts — consolidation only helps if the new rate is genuinely lower.
- Avoid re-accumulating balances on cards you've just paid off; consider closing or freezing them.
- A longer term can lower your monthly payment but increase total interest paid — check both numbers before deciding.
How to Apply for a Debt Consolidation Loan
Step 1
Apply in 2 minutes
Tell us you're covering debt consolidation and a bit about your situation. No paperwork.
Step 2
Compare offers
See real offers from vetted lenders, matched to your credit profile.
Step 3
Get funded
Accept an offer and funds typically land within 24 hours.