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10 best debt consolidation loans in Canada in 2025
Discover the top consolidation loans to tackle your debt and simplify your finances.
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 try an alternative lender.
This guide primarily focuses on alternative lenders that offer some of the best debt consolidation loans in Canada. They tend to provide easier approval than banks, but they may also charge higher rates.
- Accepts bad credit borrowers
- Quotes from multiple lenders
- Pre-approval in 5 minutes
- Funds in as little as 24 hours
10 best debt consolidation loans in Canada
1. Spring Financial
Spring Financial is one of the more established 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 online 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.
2. 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.
3. Loans Canada
Loans Canada is an online loan search platform based in Toronto, Ontario. It’s been in business since 2012.
Suited for: People of all credit scores, but especially those with poor credit.
Why it’s one of the best
- Large lender network. Loans Canada has a large database of lenders, which is especially helpful if your financial situation is not very strong.
- Fast. Fill out one online application in less than 10 minutes to get matched with lenders open to financing you.
- Low starting rate. Loans Canada’s rate starts at 9.99% if you have good to excellent credit, which is competitive.
4. Cashco Financial
Cashco is a private direct lender with online and in-person applications available.
Suited for: People with fair to bad credit who need flexible payments.
Why it’s one of the best
- Good service. Cashco has been consistently praised for its friendly, professional customer service.
- Flexible. Cashco will work with you so that your loan payments fit with your budget.
- Fast. You can get a decision within minutes of submitting your online application.
5. FlexMoney
FlexMoney is an online-only direct lender of personal loans, which you can use to consolidate debt.
Suited for: People with fair to bad credit looking for fast online funding.
Why it’s one of the best
- Fast. You can get your loan funds as soon as the same day or the next day.
- Easy application. FlexMoney offers a simple application, with little to no documents required, thanks to instant bank verification.
- Fully online. You don’t need to leave your home to get a debt consolidation loan.
6. 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.
Suited for: Borrowers with bad credit looking to consolidate high-interest loans.
Why it’s one of the best
- Established. easyfinancial has been in business since 2006, and its parent company, goeasy, is listed on the Toronto Stock Exchange. It also has hundreds of branches across the country.
- 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.
7. 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, especially homeowners.
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.
8. CIBC
CIBC is one of Canada’s largest banks, with a strong presence across the country and decades of lending experience. It offers flexible options if you need to consolidate debt.
Suited for: People with good to excellent credit and a debt-to-income ratio under 40%.
Why it’s one of the best
- Established lender. Get peace of mind knowing you’d be borrowing from a well-known, reputable brand.
- High loan amounts. Borrow up to $200,000, depending on your financial situation.
- Online application. Unlike other banks, you can apply online for a debt consolidation loan.
9. LM Credit
LM Credit is a Mississauga-based lender, specializing in debt consolidation loans for bad credit.
Suited for: People who have debts in collections that need to be paid off.
Why it’s one of the best
- Debt consolidation experience. LM Credit has specific experience in lending to people who are struggling with loans in collections.
- Non-employment incomes may be accepted. You don’t necessarily have to be employed full time to qualify. LM Credit is open to incomes like government benefits and private pensions.
- Easy application. Apply online and get a no-obligation quote within three minutes.
10. Fig
Fig offers unsecured personal loans to prime borrowers, which you can use to consolidate debt.
Suited for: Borrowers with good to excellent credit who want a bank alternative.
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.
How we found the best loans
Finder experts collected 17 points of data for more than 40 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.
Must read: Best debt consolidation loans for bad credit
Key takeaways
- Debt consolidation loans allow borrowers to combine multiple debts into one manageable payment, potentially saving money on interest.
- Approval depends on factors like credit history, income and debt levels, with both traditional and alternative lenders available. There are no guaranteed debt consolidation loans. Lenders need to review your finances before approving.
- Comparing interest rates, fees, and repayment terms is essential to finding a loan that best suits your financial needs.
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.
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 35% 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 and Spring Financial. 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 overspending and defaulting 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 minimum monthly 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.
Must read: Top debt relief companies
Plans to get a debt consolidation loan
According to data released in the Finder: Consumer Sentiment Survey Q2 and Q3 2023, fewer Canadians were 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.
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