On this page (12 questions)
- Can you get a car loan with low credit in Ontario?
- What score counts as low?
- Can you get a car loan with a 500 score?
- Does applying for a car loan hurt your credit?
- What rate comes with a non-prime car loan?
- How much income do you need in Ontario?
- Do you need a down payment?
- Bank, dealership, or concierge: what's the difference?
- What protections do Ontario car buyers have?
- Will a car loan rebuild your credit?
- Can you refinance later?
- How Simply Drive works for people rebuilding
A lot of people search "bad credit car loans." We say "rebuilding credit" instead, because credit is a situation you're in, not a label for who you are. If your score is lower than you'd like and you still need a reliable car, this guide gives you the honest picture.
Quick note: this is general help, not legal or money advice. Any rate you hear about depends on a lender saying yes.
“I requested a manual transmission and he found one despite the odds. Absolutely loving the car!”
Can you get a car loan with low credit in Ontario?
Yes. Some lenders specialize in exactly this. They're called non-prime lenders, and they look at your whole application, not just your score. Things that carry real weight:
- Steady income
- Time at your job
- A down payment
- A sensibly priced car
The honest part: your options are narrower and the cost of borrowing is usually higher than the lowest advertised bank rates. What we'd never tell you is that approval is guaranteed, because it always depends on a lender's review of your situation.
In plain terms: "Non-prime" just means lending to people whose credit sits below the range big banks save for their best rates. It's a lending category, not a judgment. We use "non-prime" and "rebuilding credit" instead of "subprime" or "bad credit."
What score counts as low?
In Canada, scores run from 300 to 900, and there's no separate Ontario scale. The numbers below come from Equifax. A score of 660 and up is generally seen as lower risk, and below that it can get harder to land the best terms, as Equifax lays out. TransUnion uses its own model, so your two scores can differ a little.
Source: Equifax Canada. Where you land is just one of several things a lender weighs.
Can you get a car loan with a 500 score?
Often, yes, through non-prime lenders. A score around 500 sits in the poor band, but it isn't a hard cutoff on its own. These lenders weigh your income, job stability, and down payment right alongside the score, so a steady job and a sensible car can carry an application the score alone wouldn't.
The honest trade-off is in the cost. A score near 500 usually means a higher rate and a closer look at whether you can afford the payment. It doesn't mean the door's closed, and it doesn't mean approval is guaranteed either. It comes down to the lender's review of your whole picture.
Does applying for a car loan hurt your credit?
One application causes a small, temporary dip from the credit check it creates. Applying to lots of lenders separately over a long stretch can add up, though. That check is a minor factor compared to your payment history.
This is one quiet advantage of going through a concierge:
- Instead of you applying at several lenders over weeks, one application goes out across a network of lenders
- That keeps the footprint on your credit file small
- And checking your own score is a soft inquiry, so it never affects your score at all
In plain terms: A "hard inquiry" is when a lender checks your credit for an application, and it can cause a small, short dip. A "soft inquiry," like checking your own score, has no effect at all. Knowing the difference takes the fear out of watching your own credit.
What rate comes with a non-prime car loan?
Higher than prime bank rates, and the exact number depends on the lender's review, so no rate can be promised in advance. Lenders set a rate to match the risk they're taking on, which is why a lower credit profile usually means a higher rate.
For context, figures pulled together from Statistics Canada data put the average new-car loan rate near 6.5 percent in late 2025, with used and non-prime rates running higher. Your number depends on your credit tier, the loan length, the car's age and price, and your down payment. Every figure depends on a lender approving you.
In plain terms: The interest rate is the cost charged on the money you borrow. The APR folds in that rate plus any mandatory lender fees, so it shows the true cost. The Financial Consumer Agency of Canada points to APR as the better number for comparing offers, and Canadian lenders have to disclose it in the loan agreement.
How much income do you need in Ontario?
Most non-prime lenders want steady, provable income and a job history of at least a few months, rather than one fixed dollar figure. As a working baseline, we look for:
- At least $2,000 a month in income
- The ability to get insurance
- A valid Ontario G or G2 licence
Lenders care about stability as much as the amount. Someone who's been at the same job a year reads differently from someone who started last week, even at the same pay. If you're short on time at the job, an Ontario-based co-signer can sometimes bridge the gap.
Do you need a down payment?
Not always, but it usually helps, because it lowers what you borrow and reduces the lender's risk. A bigger down payment can widen your options and sometimes improve the terms.
The reason is your loan-to-value:
- More money down means the loan covers less of the car's value
- Lenders read that as lower risk
- A trade-in with positive equity can play the same role as cash
Even a modest down payment shows commitment and shrinks the financed amount, which trims both your monthly payment and the total interest. Weighing whether to put money down or keep it as a cushion? Seeing the full cost both ways, which we lay out before you sign, makes the trade-off real instead of abstract.
In plain terms: "Loan-to-value" is the size of the loan compared to what the car's worth. A $5,000 down payment on a $20,000 car means the loan covers $15,000, or 75 percent of the value. Lower loan-to-value usually reads as lower risk.
Bank, dealership, or concierge: what's the difference?
They mainly differ in how many lenders they reach and how the process runs. A bank lends its own money and sets its own bar. A traditional dealership sells from its own lot. A concierge sends one application across many lenders and finds cars across many dealers.
We're the concierge in that last column. One application reaches many doors at once.
What protections do Ontario car buyers have?
If you buy from a registered dealer in Ontario, you're covered by protections enforced by OMVIC, the province's vehicle sales regulator. Its job, per OMVIC, is to keep the marketplace fair and protect buyers.
In practice, buying from an OMVIC-registered dealer means:
- All-in pricing. The advertised price can't have extra fees piled on beyond tax, licensing, and options you asked for.
- Honest disclosure. Dealers must tell you a vehicle's history and condition.
- A compensation fund that can help buyers who lose money in a deal with a registered dealer.
Confirming that whoever you buy from is registered is a simple, worthwhile step.
In plain terms: Under Ontario's rules, a registered dealer's advertised price has to include all fees. The only add-ons allowed are tax, licensing, and options you specifically asked for. The price on the ad is meant to be the price you actually pay, before tax and plates.
Will a car loan rebuild your credit?
It can, when every payment is made in full and on time, because the lender reports that history to Equifax and TransUnion. On-time payments help, and missed ones hurt.
We're not a credit-repair service, and we won't promise your score will jump by any amount. What's fair to say is that a reported loan paid as agreed adds positive history over time. Pair it with low credit card balances and steady payments across the board, and that's how the history builds.
Can you refinance later?
Maybe. For some people, after a good stretch of on-time payments, refinancing at a better rate becomes an option as their credit strengthens. It's a possible door, not a scheduled event, and there's no fixed timeline that fits everyone. Any new financing is again subject to a lender's yes.
How Simply Drive works for people rebuilding
We're an education-first concierge, so we explain each step and keep every dollar visible, instead of pushing a sale.
- You share your situation, income, and preferences
- We take your file to our lender partners and report back with a real rate, term, and payment, all depending on a lender's yes
- We find a car across our dealer partners that fits the approval and your budget
- We break down the full cost, line by line, with the reasoning behind every recommendation
The free assessment is a no-pressure way to see what paths may be open, with no contact details needed to start.
Related reading
- Auto financing after a consumer proposal
- What car loan rate can you get with bad credit?
- Car loans for newcomers to Canada
- Buying your first car with no credit history
- How Simply Drive works
A calm next step
If a reliable car is the goal while you rebuild, the assessment explains your options without pressure. It's free, it doesn't promise approval, and there's no obligation.
Simply Drive is not a bank, credit union, financial advisor, financial planner, or lender. This page is general education and not financial or legal advice. Any rate or payment is on approved credit and subject to lender approval.
Last updated July 19, 2026.