Life is full of surprises. Sometimes those surprises are pleasant, like extra vacation days or your significant other proposing marriage. But some surprises are shocks — such as a car accident or your basement flooding. Whether pleasant or unpleasant, life’s surprises are something we all need to deal with. Now, we can choose to roll with the punches or let them beat us down. To help with the former, you can get a personal loan.
What is a loan?
A loan is an amount of money you borrow from a bank or lending institution. You then repay the loan amount in instalments based on a pre-decided schedule. Apart from paying back the loan amount, you also need to pay some amount as interest. The amount of interest you pay depends on the interest rate you agreed upon while taking the loan. It is usually a percentage of the loan amount. For example, if you had taken a loan of $10 with an interest rate of 5% then you would have to pay back an additional $2. In total, you would pay back $12.
Bear in mind that these interest rates can be a fixed interest rate or fluctuating interest rate (known as floating interest rate). Each type of interest rate has its own advantages. A floating interest rate is dependent on the prime rate. If the prime rate goes up, then your interest rate goes up too and you must pay a higher amount as interest. If the prime rate goes down, then you can get away with paying a lesser amount as interest. However, if your interest rate is fixed, then you will have to pay a fixed interest rate no matter how high the prime rate climbs.
What is a personal loan?
You can get specific loans for specific purposes. You can get an auto loan for buying a car, or a home loan or mortgage to purchase a house. You can even get an education loan for any education-related expenses like getting a higher degree. A personal loan, however, is a catch-all loan used for, you guessed it, personal reasons like urgent repairs, home renovations, or to splurge on a much-needed family holiday abroad.
What are the benefits of personal loans?
Personal loans come with a host of benefits, such as:
- You have access to emergency funds to meet all of life’s unpleasant surprises
- You can indulge in once-in-a-lifetime experiences like a lavish wedding or family vacation you can’t afford to pay for all at once
- You can purchase what you need now versus saving and waiting for what could take a very long time to achieve your target amount
While personal loans are wonderful in many ways, not all personal loans are equal. Some may involve cumbersome application processes with tons of paperwork. Some involve too many eligibility criteria, come with steep interest rates, have taxing repayment schedules, or worse. So what is getting a loan from Innovation like? Let’s find out.
What are the advantages or benefits of getting a personal loan from Innovation Federal Credit Union?
You can enjoy a quick and easy online application process
At Innovation, you can easily apply for a personal loan in minutes simply using your smartphone, tablet, laptop, or desktop. Not only is it as simple as filling out some information and clicking a few buttons, but it’s also a hassle-free, speedy process. You can also apply for a personal loan right over the phone if you’re more comfortable speaking to an advisor.
You pay low interest rates
Remember how we said that interest rates determine how much extra money you would have to pay back when you take a loan? Well, at Innovation our rates are extremely competitive. That means we offer some of the lowest interest rates in the market! This allows you to enjoy affordable payments, which ultimately means worry-free debt.
You can choose from flexible payment options
When you take a loan, you usually must pay it back according to a pre-decided schedule. Your payments may be monthly, bi-monthly, or weekly. Some lenders may even charge you a penalty if you make payments out of schedule, such as trying to make more frequent payments so your loan repayment term can end quicker. Not us! At Innovation, we offer truly flexible borrowing. You can choose to pay back your personal loan as you deem fit. Want to make monthly payments? That’s up to you. Want to make weekly or even bi-weekly payments? Your call to make!
You can pay off your loan faster
Just like some lenders may charge a penalty fee if you want to pay out of your pre-decided schedule, some may even charge you for trying to pay more than the agreed-upon amount in each instalment. Sometimes, you may come into some funds through a bonus at work or income tax returns and want to use it to pay off your personal loan and be debt-free. However, paying off your loan earlier than expected by paying a lump sum amount is not accepted by many lenders. This is because it would affect the amount you pay as interest over the long term. At Innovation, we put our members' well-being before any kind of profit. Therefore, we allow you to pre-pay your loan without any penalty. So, any additional payments you choose to make (beyond the instalments agreed upon) are completely unlimited and penalty-free!
You can earn cash dividends
When you become a member of Innovation, you automatically get enrolled in our Member Rewards Program. This is a special kind of rewards program where our members can earn cash dividends simply by banking with us. So, if you take a personal loan from us, you will earn cash dividends. In fact, the more you bank with us, the more you can earn in terms of cash dividends. Talk about rewarding banking!
As you can see, getting a personal loan from Innovation comes with many perks. But we’re sure you have some questions too. Let’s look at some of the most common questions we get about personal loans at Innovation Federal Credit Union
FAQs
How do I apply for a personal loan?
Once you submit your loan application through our quick and easy online application process, you will be contacted by our team. If you’d like to connect with our advisors to ask any questions or need an update on your application, you can easily call them at 1.866.446.7001.
What are the main eligibility criteria to get a personal loan from Innovation Federal Credit Union?
To be eligible to get a personal loan from Innovation, you need to be at least 18 years of age. Apart from being of legal adult age, you would also be required to be a Canadian resident.
What do I need to apply for a personal loan?
To ensure your loan application process is quick and easy, it’s best to provide the following information and documents. Bear in mind that if you nominate a guarantor for your personal loan, you would be required to provide their information and documents too:
- Driver’s license or passport
- Loan details, for example, purchase information on what you need your loan for or recent loan/credit card statements if you’re consolidating debt
- Employment information (name of employer, legal/physical address, phone number, occupation, total time with employer/time in the sector, employment status (full time or part-time; hourly or salary)
- Income verification (a current paystub AND recent T4 slip/final paystub from the previous year)
- 3 years of income tax and Notice of Assessment (if you’re self-employed)
- List of assets and liabilities
- Disclosure of previous bankruptcy, judgements, consumer proposals, alimony, child support
- Residence details (homeowner/renter, mortgage/rental payments, annual/monthly property tax, energy bills needed if on equalized payments)
How do I access my personal loan?
Once approved, your loan funds will be deposited into your chequing account.
How can I make additional loan payments to pay my loan off faster?
With Innovation, paying off your loan faster is penalty-free as you already know. Follow the steps below to pay your loan off quicker:
- Log into digital banking
- Select Payments & Transfers > Transfers > Transfer Money
- Choose the account you’d like to make your loan payment from (e.g. your No-Fee Bank Account)
- Choose your personal loan from the Transfer to option. Your transfer will be a principal-only payment. If you’re paying your entire Personal Loan balance, call us to get the correct payment amount to cover all outstanding interest
- Enter the amount you want to pay
- Continue and confirm!
Ready to get your personal loan? Apply now! Or if you have any questions, you can always call, chat or message us to contact us and we’ll help you in any way we can.