The Core Criteria
Requirements differ lender to lender, but nearly all of them evaluate the same four things: your identity, your income, your credit history, and your existing debt load. Knowing these ahead of time is what lets you prepare properly.
Canadian lenders operate under federal and provincial consumer lending rules that require identity verification and a real assessment of your ability to repay — protections that work in your favour, not just paperwork.
Identity and Residency
Identity verification is mandatory under anti-fraud and anti-money-laundering rules.
- 18 or 19+ depending on province
- Canadian citizen or permanent resident
- Valid government photo ID
- Proof of current address
- A valid SIN for the credit check
Income
Income verification is arguably the single most important piece — lenders need to know you can make the payments without strain.
Most Canadian lenders set a minimum monthly income somewhere between $800 and $1,500. Accepted sources include employment wages, self-employment income (with a CRA NOA), EI, CPP, OAS, disability income, pensions, and sometimes support payments.
- Recent pay stubs, usually the last 2-4 periods
- CRA Notice of Assessment for self-employed applicants
- 2-3 months of bank statements showing regular deposits
- Benefit award letters for government income
- An employment verification letter, if the lender asks for one
Credit Score
Your score influences both approval and rate, though there's no single universal cutoff.
Canadian scores run 300-900. Major banks generally want 650+; online and alternative lenders will often go down to 500-550, and some evaluate applications with no strict minimum at all.
| Lender Type | Typical Minimum Score | Rate Range |
|---|---|---|
| Major bank | 650-680 | 6%–15% APR |
| Credit union | 580-640 | 8%–18% APR |
| Online lender | 550-600 | 12%–30% APR |
| Alternative/subprime lender | 500-550 | 25%–35% APR |
Debt-to-Income Ratio
Your DTI is total monthly debt payments divided by gross monthly income.
Most lenders want 40% or below, new loan included. Earning $3,000/month with $800 in existing debt puts you around 27% — add a $150 payment and you're at roughly 32%, still comfortably within range for most lenders.
If your DTI runs too high, paying down existing debt, boosting income, or requesting a smaller loan can all bring it back in range.
Bank Account
You'll need an active account, both for receiving funds and for automatic repayment.
It should be in your name and open at least 1-3 months. Some lenders look at your recent activity — regular deposits, no frequent overdrafts — as part of the assessment.
What to Have Ready
Assembling everything in advance saves real time.
- Government photo ID
- SIN
- Proof of current address
- Recent pay stubs or income documents
- 2-3 months of bank statements
- A list of current debts and payments
- Your employer's contact info, if requested
- CRA Notice of Assessment, if self-employed
Scan or photograph everything before you start the application — it can cut processing from days to hours.