How Loan Interest Is Calculated: A Plain-Language Explanation
Loan interest is the cost of borrowing, calculated from the principal, the rate, and the time you hold the money.
Read guide →Canadian borrowing guides
111 guides covering loans, credit, debt and mortgages in Canada. Every factual claim is attributed to an official source, and each page shows when it was last updated.
Borrowing basics
What Is APR? The Number That Makes Loans Comparable
APR is the annual percentage rate: the yearly cost of borrowing, including interest and certain fees.
Read guide →Instalment or installment: which spelling is correct in Canada?
In Canada, the standard spelling is instalment, with one l. Installment, with two, is the American form.
Read guide →Co-signer and Guarantor: How Liability and Credit Impact Differ in Canada
A co-signer shares the loan and the payments; a guarantor only pays if the borrower defaults.
Read guide →What It Means to Be a Co-signer or Guarantor on a Canadian Loan
A co-signer in Canada is legally on the hook for the full debt if the primary borrower stops paying.
Read guide →How Fast Can Loan Funding Arrive — And What Does Speed Cost In Canada?
Some Canadian lenders can fund a loan within a day, while others take several.
Read guide →How Long Does Loan Approval Take, and When Does the Money Arrive?
Loan approval in Canada often takes minutes to a few business days.
Read guide →How to Run a Proper Loan Comparison Using APR and Total Cost of Credit
A proper loan comparison means ranking offers by APR and total cost of credit, not by the advertised rate alone.
Read guide →How Interest Rate Negotiation Works: Asking a Lender for Better Terms
For most Canadian borrowers, interest rate negotiation means asking for a lower rate with evidence, and success depends on your…
Read guide →How to Read a Loan Agreement in Canada Before You Sign
Reading a loan agreement means checking total borrowing cost, every fee, and any clause that lets a lender change the deal.
Read guide →The Canadian Loan Application Journey: From Pre-Qualification to Funding
In Canada, a loan application moves from pre-qualification to document checks, underwriting, and funding.
Read guide →Understanding Online Loan Lending and Lender Legitimacy in Canada
An online loan in Canada is applied for digitally and funded after checks.
Read guide →How Prepayment Penalty and Early Repayment Rules Work in Canada
A prepayment penalty is a fee some lenders charge when you pay a loan off early or pay more than your contract allows.
Read guide →Small Loan Basics in Canada: Costs, Credit Checks and Repayment
A small loan in Canada is a modest sum repaid over a set term.
Read guide →Government student loan programs vs private borrowing: what repayment looks like
Government student loans are need-based, no-collateral public funding; private lending depends on credit.
Read guide →Budgeting
Building an Emergency Fund That Actually Holds
An emergency fund is money set aside for unexpected costs so you do not have to borrow.
Read guide →Making a Budget That Fits Real Canadian Life
A budget is a plan for your money. Track what comes in and what goes out, set realistic categories and review it monthly so it…
Read guide →How Canadians Can Lower Everyday Bank Fees
Bank fees are common, but many are avoidable. Match your account package to your habits, meet waiver conditions, and ask your…
Read guide →Business financing
How to get a small business loan in Canada
A small business loan is money borrowed to fund a business and repaid with interest over an agreed term.
Read guide →Business line of credit vs term loan: which to use
A term loan gives you a lump sum repaid on a fixed schedule, while a line of credit gives you a limit you can draw on, repay and…
Read guide →Personal guarantee explained for Canadian business owners
A personal guarantee is a promise to repay a business debt if the business does not.
Read guide →Canadian small business financing programs explained
Government financing programs usually work through lenders rather than lending directly.
Read guide →How Business Credit and Personal Credit Scores Differ in Canada
Business credit is a separate file from your personal credit score and works differently.
Read guide →How Equipment Financing Works for Canadian Businesses
Equipment financing lets Canadian businesses acquire equipment without paying the full cost upfront.
Read guide →Invoice Factoring and Receivables Financing: How They Compare to a Business Loan
Invoice factoring turns unpaid invoices into cash; a loan advances funds you repay.
Read guide →Consumer protection
Loan Approval Red Flags Every Canadian Borrower Should Know
Legitimate lenders disclose costs in writing and never promise approval.
Read guide →Credit
Rebuilding Your Credit: A Practical Canadian Guide
Rebuilding credit in Canada means fixing report errors, paying on time and lowering balances.
Read guide →Understanding Your Canadian Credit Report Line by Line
A Canadian credit report lists your accounts, payment history and inquiries from Equifax Canada and TransUnion Canada.
Read guide →The Factors Behind Your Canadian Credit Score
Your Canadian credit score is shaped by payment history, how much of your available credit you use, how long your accounts have…
Read guide →Hard and Soft Credit Checks: What the Difference Means for You
A hard credit check happens when a lender assesses an application and may affect your score.
Read guide →Correcting Errors on Your Canadian Credit Report
You can dispute a credit report error in Canada for free. Under PIPEDA you have the right to access your file and ask the bureau…
Read guide →How a Balance Transfer Credit Card Promotion Works in Canada
A balance transfer card moves existing debt onto a new card at a low promotional rate.
Read guide →How a Credit Alert Helps You Guard Against Identity Theft in Canada
A credit alert flags your credit file so lenders verify your identity before new credit is issued.
Read guide →How Credit Scores Work in Canada and What the Ranges Signal to Lenders
Your credit score is a three-digit rating, generally 300–900 in Canada, that lenders use to judge lending risk.
Read guide →How Negative Items Affect Your Credit Report and How Long They Linger
Most negative items stay on a Canadian credit report for a set period.
Read guide →How Canadians Can Check Their Credit Score and Report for Free
You can check your credit score and report in Canada for free, directly from a national credit bureau.
Read guide →How to Strengthen Your Credit Score Before a Mortgage Application
Strengthen your credit score before a mortgage by fixing report errors, lowering balances and paying on time.
Read guide →How Credit Inquiries Affect Your Canadian Credit Report — and When They Can Be Removed
A hard credit inquiry stays on your Canadian credit report for a set period.
Read guide →Line of Credit or Credit Card in Canada: Which One Fits Your Borrowing?
A line of credit usually costs less for ongoing borrowing; a credit card wins on convenience.
Read guide →How a Secured Credit Card Works to Build or Rebuild Credit in Canada
A secured credit card is a deposit-backed card that reports to Canada's credit bureaus, so responsible use can build or rebuild…
Read guide →Debt management
How to break the payday loan cycle: a step-by-step plan
The payday loan cycle repeats when one repayment leaves a gap that the next loan fills.
Read guide →Debt consolidation explained: how combining debts works
Debt consolidation combines several debts into one payment, usually to lower the interest you pay or simplify your budget.
Read guide →Consumer proposal or bankruptcy: how the two formal options differ
A consumer proposal is a negotiated settlement with your creditors. A bankruptcy is a formal assignment of assets.
Read guide →Credit counselling or debt settlement: which one actually helps
Credit counselling is usually non-profit and focuses on budgeting and a repayment plan.
Read guide →How to consolidate credit card debt without making it worse
Consolidating credit card debt means replacing several card balances with one payment.
Read guide →Debt-to-income ratio explained for Canadian borrowers
A debt-to-income ratio compares your regular debt payments with your gross income.
Read guide →How to prioritize debt repayment when money is tight
The order you pay off debts can change how much interest you pay and how long it takes.
Read guide →Debt Repayment Methods Compared: Avalanche Versus Snowball
Debt repayment is a choice: clear the highest interest first (avalanche) or the smallest balance first (snowball).
Read guide →How to Tell If Your Debt Level Has Become Unsustainable
Your debt level is too high when payments crowd out essentials, ratios exceed lending thresholds, or you borrow to cover basics.
Read guide →How creditor negotiation works when you cannot pay in full
Creditor negotiation in Canada means asking a creditor to accept a revised payment plan or settlement when you cannot pay in…
Read guide →How the Limitation Period on Debt Works Across Canadian Provinces
The limitation period on most Canadian debts is set by provincial law, so where you live decides how long a creditor can sue you.
Read guide →What Is Wage Garnishment and How Can It Affect Your Pay?
Wage garnishment is a legal process that lets a creditor collect money from your pay.
Read guide →What Happens After a Loan Default in Canada?
Defaulting on a loan in Canada triggers collections contact, credit-report damage and possibly legal action.
Read guide →Home equity
HELOC Explained: How a Home Equity Line of Credit Works
A home equity line of credit lets you borrow against the equity in your home, usually at a lower rate than unsecured credit.
Read guide →HELOC vs Home Equity Loan: Which Fits Your Needs?
A HELOC is a revolving line of credit, while a home equity loan is a lump sum repaid in fixed instalments.
Read guide →Using Home Equity to Consolidate Debt: Benefits and Risks
Home equity can consolidate high interest debt into one lower cost payment, but it turns unsecured debt into secured debt.
Read guide →Risks of Secured Borrowing: What You Are Putting on the Line
Secured borrowing uses an asset, often your home, as collateral in exchange for a lower rate.
Read guide →Mortgages
Fixed vs Variable Mortgage: Which Should You Choose?
A fixed mortgage keeps your payment steady for the term, while a variable mortgage moves with the lender prime rate.
Read guide →How Much Mortgage Can You Afford in Canada?
How much you can afford is not the same as the maximum a lender will approve.
Read guide →Mortgage Pre-Approval: What It Is and How to Get One
A mortgage pre-approval tells you roughly how much a lender would lend and often holds a rate for a set period.
Read guide →Minimum Down Payment in Canada: How Much You Need
The federal minimum down payment is tiered by purchase price, and any down payment below 20% means the mortgage must be insured.
Read guide →The Canadian Mortgage Stress Test, Explained Simply
The mortgage stress test requires federally regulated lenders to qualify you at a rate higher than your contract rate.
Read guide →Mortgage Renewal: How to Get Better Terms
A mortgage renewal is when your term ends and you choose new terms and a new rate.
Read guide →Closing Costs When Buying a Home in Canada
Closing costs are the fees and taxes you pay around the purchase of a home, on top of the down payment.
Read guide →How Mortgage Rate Differences Arise Across Canadian Provinces
Mortgage rate offers vary by province due to local competition, rules, taxes and housing markets.
Read guide →How Canadian Home Buyers Can Build a Down Payment and Prove It to Lenders
Your down payment can come from savings, gifts, or eligible assistance.
Read guide →How Canadian Lenders Assess Mortgage Eligibility Beyond the Headline Rate
Mortgage eligibility rests on income, debts, credit, down payment and the property — not the headline rate.
Read guide →How Your Mortgage Payment Is Divided Between Principal and Interest
Each mortgage payment is split between interest, which the lender keeps, and principal, which cuts your balance.
Read guide →How Mortgage Insurance Works for Canadian Home Buyers
Mortgage insurance protects the lender if a high-ratio borrower defaults.
Read guide →Understanding How a Mortgage Penalty Is Calculated and Reduced
Mortgage penalty is the prepayment charge for breaking a closed mortgage early.
Read guide →How to Compare a Mortgage Quote in Canada: Rate, Term, Penalties and Fees
Compare a mortgage quote on three things first: the interest rate, the term length, and the penalty and fee structure.
Read guide →How Mortgage Term and Amortization Period Work Together in Canada
A mortgage term is your current contract length; amortization is the total time to repay the loan.
Read guide →How a Mortgage Refinance Works in Canada — and When It Pays Off
Refinancing a mortgage swaps your loan for a new one, often to cut your rate or tap equity.
Read guide →How Rent to Own Agreements Work in Canada — and What Buyers Risk
Rent to own is a lease with an option to buy later, but the lease and the purchase are separate contracts.
Read guide →What Really Determines Your Mortgage Payment in Canada — and What You Can Change
Your mortgage payment depends on the loan amount, rate, amortization and payment frequency.
Read guide →Personal loans
How to Get a Personal Loan in Canada: A Practical Walkthrough
A personal loan gives you a lump sum you repay in fixed instalments.
Read guide →Personal Loan vs Line of Credit: Which Fits Your Situation?
A personal loan pays you a lump sum with fixed instalments, while a line of credit lets you draw funds as needed.
Read guide →How Much Can I Borrow? What Lenders Look At
How much you can borrow depends on your income, debts, credit history, and any collateral.
Read guide →Fixed vs Variable Rate Loans: How to Choose
A fixed rate locks your payment for the term, while a variable rate can move with the market.
Read guide →Secured vs Unsecured Loans: What the Difference Means for You
A secured loan is tied to an asset the lender can claim if you default; an unsecured loan is not.
Read guide →Promissory notes
What is a promissory note in Canada?
A promissory note is a written promise by one party to pay a sum of money to another on demand or at a specified time.
Read guide →Promissory note vs loan agreement: which one do you need?
A promissory note is a simple unconditional promise to pay, while a loan agreement sets out the full terms of a loan.
Read guide →Is a promissory note legally binding in Canada?
A promissory note can be legally binding in Canada when it meets the Bills of Exchange Act and contract law.
Read guide →Promissory Note Enforcement in Canada: What Happens After Default
If a promissory note is unpaid, the holder may demand payment, sue, or enforce judgment.
Read guide →How to Write a Promissory Note in Canada: Required Elements and Common Pitfalls
Write a promissory note in Canada with a signed, unconditional promise to pay a set sum, plus parties, date and terms.
Read guide →How Promissory Note Interest Works in Canada and Where the Legal Ceiling Sits
Promissory note interest in Canada follows the note's terms, capped by the criminal rate of interest.
Read guide →Promissory Note or IOU: Which Document Fits Your Situation?
A promissory note is a signed, unconditional promise to pay a set sum, while an IOU only acknowledges that a debt exists.
Read guide →Short-term lending
Instalment loan vs payday loan: how the two compare in Canada
An instalment loan is repaid in scheduled payments over months, while a payday loan is a single lump-sum repayment, usually…
Read guide →How instalment loans work: payments, rates and terms explained
An instalment loan gives you a lump sum that you repay in scheduled payments over a set term.
Read guide →Payday loan cost by province and territory in Canada
Since 1 January 2025, payday loans in provinces with a payday regime are capped at $14 per $100 borrowed, with a $20…
Read guide →Payday loan alternatives in Canada: cheaper ways to cover a cash gap
Payday loans carry the highest cost of almost any consumer credit.
Read guide →Emergency loan options in Canada when you need cash quickly
When an urgent cost lands, the cheapest option is usually the one you already have.
Read guide →How to File a Consumer Complaint About a Payday Lender or Financial Service in Canada
A consumer complaint about a payday lender starts with the lender, then escalates to a provincial regulator or federal agency.
Read guide →Credit Card Cash Advance vs Payday Loan: What Canadian Borrowers Should Know
A cash advance is credit-card cash with interest from the transaction date.
Read guide →What To Do When You Cannot Make A Payday Loan Repayment On Time
Act before the due date: contact your lender, ask about a repayment plan, and know your provincial rules.
Read guide →Tax instalments
CRA quarterly tax instalments: how the payment schedule works
CRA quarterly tax instalments are advance payments due four times a year, on March 15, June 15, September 15 and December 15.
Read guide →Who has to pay CRA tax instalments in Canada?
You may have to pay CRA tax instalments if your net tax owing is more than $3,000 for 2026 and in either 2025 or 2024.
Read guide →How to calculate your CRA tax instalments
To calculate CRA tax instalments you can use the no-calculation, prior-year or current-year option.
Read guide →CRA instalment interest and penalties explained
CRA instalment interest applies when your payments are late or too low.
Read guide →How to Read a CRA Instalment Reminder and Choose a Calculation Option
A CRA instalment reminder (INNS1) shows what you owe in quarterly tax prepayments and offers three calculation options.
Read guide →How to Make a CRA Tax Instalment Payment and What to Do After a Missed Due Date
You can make a CRA tax instalment payment online, by phone or at your bank by each quarterly due date.
Read guide →How to Lower or Stop CRA Tax Instalments After an Income Change
CRA tax instalments can be reduced or stopped when income drops, but you must update your estimate and ask the CRA to…
Read guide →Why You Still Owe Tax When Tax Instalments and Payroll Deductions Do Not Match
Tax taken at source can miss side income, investments, or multiple jobs.
Read guide →Why the CRA Requests Tax Instalments and How You Can Reduce Them
Tax instalments are quarterly CRA prepayments based on net tax owing.
Read guide →Vehicle financing
How to finance a car in Canada, step by step
Car financing in Canada usually comes from a dealership, a bank or a credit union, and the total cost depends on the rate, the…
Read guide →How car loan term length changes what you pay
Car loan term length is the number of months you take to repay, and it shapes both your monthly payment and your total interest.
Read guide →Dealer financing vs a bank loan: which fits you
Dealer financing is arranged at the dealership, while a bank or credit union loan is arranged directly with the lender.
Read guide →Used car financing checklist for Canadian buyers
Used car financing works like any car loan, but the vehicle history and condition matter more because they affect the lender…
Read guide →How Car Loan Refinance Works in Canada: When It Helps and What It Costs
Ideally, a car loan refinance lowers your interest cost or monthly payment; it can also backfire by stretching your term or…
Read guide →Getting a Car Loan in Canada With Little or No Credit History
Thin or empty credit files are common, and they do not automatically disqualify you from a car loan in Canada.
Read guide →When a Car Loan Becomes Unaffordable: Selling, Refinancing, or Surrendering the Vehicle
Selling works if the car is worth more than the car loan; refinancing lowers the payment; surrender is a last resort.
Read guide →Important legal information
Promissory.ca is not a lender, bank, mortgage broker or credit counsellor. We do not make lending decisions and we do not charge you a fee to use this service.
Submitting an application does not guarantee approval. All applications, rates and terms are set and approved solely by the individual lender or licensed professional.
Rates, fees and loan amounts vary by lender, province, loan type and your credit profile. Advertised rates are the lender's lowest offered rate and may not be available to you.
Lenders may perform a credit check with one or more credit bureaus, including Equifax and TransUnion. A hard credit inquiry may affect your credit score.
There is no obligation to accept any offer presented to you. Review every agreement carefully before signing.
Borrow only what you can reasonably afford to repay. Late or missed payments may result in additional fees, collection activity and negative credit reporting.
We handle personal information in accordance with the Personal Information Protection and Electronic Documents Act (PIPEDA). See our Privacy Policy for how we collect, use and protect your information.
If you are struggling with debt, consider contacting a non-profit credit counselling service or a Licensed Insolvency Trustee before borrowing more.