Overview
Installment loans are small-dollar, unsecured loans repaid over a series of installments. Designed for subprime and near-prime borrowers, installment loans can provide quick financial relief for individuals living in Victoria, British Columbia.
The Cost-of-Living Crisis in Victoria, BC
The cost of living in Victoria is 21% higher than the national average. The living wage in Victoria is estimated at $26.78 per hour, which is much higher than the provincial minimum wage of $17.40 per hour. The projected minimum wage increase to $17.85 per hour is unlikely to change the workers’ situation drastically. Ranked Canada’s third most expensive city in 2023, behind only Toronto and Vancouver, Victoria also happens to be situated in Canada’s least affordable province.
How Installment Loans Can Help
Installment loans can provide quick funds to help subprime and near-prime borrowers – those whose credit scores fall below 660 – cover a cash shortfall between paycheques. These types of loans feature a longer repayment period and potentially lower interest rates and fees than payday loans. Subprime and near-prime borrowers may lack access to more traditional credit, so alternative lenders provide installment loans to meet an unmet need in the market.
Factors that Lead to Lower Credit Scores
Lower credit scores may be the result of several factors, including the following:
- A credit utilization ratio consistently above 30%
- Defaulting on payments
- Late payments
- Missed payments
- High credit card balances
- Maxed-out credit cards
Lower credit scores may result in higher perceived credit risk, which may result in higher interest rates and fees.
Below, we will consider some pros and cons of obtaining an installment loan online.
Pros of Installment Loans
- Faster access to funds
- Faster approval
- Simple and easy online application process
- No credit check during the online application process
- Encryption technology is used to protect personal information
- Convenience of applying from the comfort of your own home
Cons of Installment Loans
- Late or missed payments may result in additional fees
- Higher perceived credit risk may result in higher interest rates and fees
Tips to Improve Your Credit Score
Many financial products and services are only accessible to individuals with higher credit scores. To improve your credit score, you may want to consider the following tips:
- Keep your credit utilization ratio below 30%.
- Consistently pay your bills on time.
- Keep older accounts open to build a longer credit history.
- Request a credit limit increase to give yourself more spending room.
- Use services like Credit Verify automatically to detect mistakes on your credit report.
Tips to Improve Your Financial Situation
While navigating the cost-of-living crisis in Victoria has never been more challenging, you may want to consider the following tips to help improve your financial circumstances:
- Consider more affordable housing alternatives such as shared housing.
- Minimize frivolous expenses such as buying coffee at large coffee chains.
- Consider ditching car ownership for public transportation due to the high costs associated with car ownership e.g. fuel costs and car insurance.
- Regularly set aside money, even if it’s only $10 a week. Even a small amount of savings will accumulate over time.
- Build an emergency fund, ideally at least three to six months’ worth of expenses.
- Increase your income by retraining for a new career, starting a side hustle, or taking on a part-time gig. Many online certifications are available for a small fee or even for free.
The Bottom Line
If you need quick funds in Victoria, BC, consider applying for an installment loan online via LendProConnect. The online application process is quick and easy, and we don’t check your credit score or credit report during the application process.
