Loans and Credit
There are three ways to apply for credit at TD Canada Trust:
* We are not able to process Applications from Quebec Residents online for the following Personal Credit Products: Loans (including RSP) and Lines of Credit.
* We are not able to process Joint Applications online for the following Personal Credit Products: Loans (including RSP) and Lines of Credit.
- What information will I need to provide when I apply for credit?
In order to process your application quickly, you may be asked to provide --
- The purpose for your application, such as home renovations or a new car purchase
- Personal details such as your name, address, birth date and Social Insurance Number (SIN optional)
- Employment and income details
- Details about a co-signor, if applicable
- Your assets, such as a car, bank accounts, investments, houses, etc.
- Your liabilities, including any loans, credit card balances, mortgages, etc., and the total of your monthly payments
Also, you will need to provide the following additional documents if you are using your home as security --
- Property tax confirmation
- A copy of your fire insurance policy
- A property appraisal (completed by TD Canada Trust)
- Your title registration
- What can I do if my application for credit is turned down?
If your request for credit has been turned down, you may still qualify for credit. To improve your chances of qualifying, you can --
- Provide collateral security and/or
- Have a co-signor guarantee your personal loan or line of credit
- What is a co-signor? Who can co-sign a line of credit or personal loan?
A co-signor is a person who becomes equally responsible for repaying a credit balance with you. Anyone of the age of majority in their province of residence can co-sign with you.
- What is collateral security and why would I use it?
Collateral is something you own that you can pledge as security for a loan or a line of credit. Examples of collateral would be the equity in your home, a new vehicle, etc. Since collateral provides extra security for your credit request, it's a great way to lower your interest rate and save on the amount of interest you pay.
- I've heard people talk about the importance of having a good credit rating. How does that affect me?
A good credit rating means that you have repaid past credit balances and continue to pay current credit balances in a timely manner. You should be able to maintain your good credit rating by making your credit balance payments on time and in full.
- Where can I obtain a copy of my credit bureau report?
You can obtain a copy of your credit history by contacting:
- What is the difference between a line of credit and a personal loan?
A line of credit is a source of readily available credit that is there for you to use whenever you want, for whatever you want. There is no need to reapply each time you wish to access the funds. As you pay off any credit that you have used, it becomes available again.
A personal loan is a source of credit for a fixed amount that allows you to make fixed monthly payments over a predetermined period of time. You can choose from a wide range of terms to make the payments fit your budget -- the longer the term, the lower your monthly payment.
- Are there different types of Lines of Credit?
There are two main types of Lines of Credit offered at TD Canada Trust -- unsecured and home equity secured.
- What is a Home Equity Line of Credit?
A Home Equity Line of Credit from TD Canada Trust is a revolving Line of Credit that is fully secured by the equity in your home. You can access your available credit anytime without having to re-apply and you can make monthly payments of as little as interest only.
- If I sell my home, can I take this Home Equity Line of Credit with me, or do I have to reapply?
If you sell your property, you must reapply and reregister a new secured Home Equity Line of Credit on the new property. You may be able to carry any existing portions of the current Home Equity Line of Credit that you have locked in to a fixed rate to the new Home Equity Line of Credit.
- Can I purchase a home with a TD Canada Trust Home Equity Line of Credit?
Yes. A Home Equity Line of Credit is available both for a home purchase and as a source of credit for other purposes. For a purchase, you require a 20% down payment and you can put the balance on your Home Equity Line of Credit. If your down payment is more than 20%, you could put the balance on your Line of Credit and have additional credit available to you.
- How do I access a TD Canada Trust Line of Credit?
You can access your available credit in the following ways --
- Write a Line of Credit cheque
- Make cash withdrawals at TD Canada Trust branches
- Add your Line of Credit to your TD Canada Trust Access Card and use it at merchants and automated banking machines (ABMs) worldwide
- Transfer funds from your Line of Credit using EasyLine telephone banking or EasyWeb Internet banking
- How is interest calculated on my Line of Credit
For the revolving portion of your Line of Credit, interest is calculated on a daily basis on the outstanding principal balance and payable on a monthly basis.
Should you choose to lock in all or a portion of your balance with our Fixed Rate Advantage Option, interest on a secured Line of Credit is calculated on a semi-annual compounding basis on the outstanding balance of the fixed portion daily from the date of the last payment, and is collected in the regular payment. Interest on the locked-in portion of an Personal Line of Credit is calculated on a daily basis on the outstanding principal balance and payable on a monthly basis.
- What happens if interest rates rise? Can I lock in the rate on my Line of Credit?
If interest rates start to rise, it's easy to use the Fixed Rate Advantage Option at any time to lock in all or a portion (subject to minimums) of your balance at a fixed interest rate with fixed payments.
Depending on which Line of Credit you qualify for, you have the option of converting a portion of your balance to one- to five-year closed mortgage rates (for home equity secured Lines of Credit) or to competitive loan interest rates (for Personal Lines of Credit).
- What is the monthly minimum payment I am required to make?
You can decide how much you want to pay each month toward your outstanding balance. Choose as little as 1% or $50, whichever is greater, or any amount up to the entire balance. When secured with the equity in your home, your payment can be interest only.
If you would like to establish fixed monthly payments to help you plan your budget, you can choose the Fixed Rate Advantage Option with regular monthly payments at any time.
- Is there a limit on how much I can prepay on my Line of Credit?
You can pay off the revolving portion of your Line of Credit any time you like.
If you have a Home Equity Fixed Rate Advantage Option, you may prepay up to 15% of the original principal amount each calendar year without charge, at any time. Any unused portion of the 15% cannot be carried over to the following year. Principal repayments in full or in part that exceed the 15% allowance are subject to an additional payment of the greater of three months' interest or an Interest Rate Differential (IRD) amount. You can also increase the payment amount by up to 100% over the term.
- What are the payment options?
Payments are required on a monthly basis. However, you can set up weekly, rapid weekly, biweekly, rapid biweekly and semi-monthly payments on the fixed-rate portion of your Line of Credit at any time during the term.
- What are the costs associated with getting a Line of Credit?
There are no application or annual fees associated with any of our Lines of Credit. However, for Home Equity Lines of Credit there may be fees to register the property as security and/or appraisal fees, which are the responsibility of the customer. These fees differ in each province.
- Is life insurance available on a Personal Loan or Line of Credit?
Yes. Life insurance is available for both TD Canada Trust Personal Loans and Lines of Credit. Loan Life and Disability Insurance offer flexible protection for your loan obligations at an affordable price. For added security, you can obtain both life and disability insurance on loans up to $250,000.
Line of Credit Life Insurance provides extra financial protection for pennies a day. Line of Credit Life Insurance can help your family and estate by paying the outstanding balance on your TD Canada Trust Line of Credit. You only pay for the amount of insurance you need, based on your average daily TD Canada Trust Line of Credit balance. If there's no balance, there's no charge.
Total Amount of Line of Credit Life Insurance is less than or equal to $50,000 Total Amount of Line of Credit Life Insurance exceeds $50,000 Application is completed within 30 days of opening the account or increasing the credit limit You do not need to answer the health questions. All applicants must answer the health questions. Application is completed more than 30 days after opening the account or increasing the credit limit All applicants must answer the health questions. All applicants must answer the health questions.
- Are there different types of Personal Loans?
There are two main types of Personal Loan offered at TD Canada Trust: fixed interest rate and variable interest rate.
Fixed Rate Loan - If you prefer to budget around regular monthly payments, a loan with a fixed interest rate is worth considering. You can choose a fixed rate of interest (one- to five-year term) and have the security of knowing exactly how much you're paying each month.
Variable Rate Loan - This is a personal loan with a set monthly payment but a fluctuating interest rate for the entire term of the loan. If you want to benefit from those times when interest rates are low, consider a loan with a variable interest rate option. If rates go down, you can pay off your loan faster.
- How is the interest calculated on my Personal Loan?
Interest is calculated daily on the outstanding principal balance and payable on a monthly basis
- How are the payments structured on my Personal Loan?
Each payment consists of a portion of interest and a portion of principal. The proportion of interest is higher in the first payment, and it is reduced as the principal is repaid.
- Can I pay off my Personal Loan early? Are there charges I need to watch out for?
You can pay off your Personal Loan any time you like with no early repayment penalties (Does not apply to real estate secured loans.)