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Getting started with borrowing

Get some tips on responsible borrowing

Credit can be your friend or your foe. When used to your advantage, you can gain a lot of benefits. Used unwisely can lead to problems and stress.

  • Types of borrowing
  • Smarter borrowing
  • How much to borrow
  • Applying for a loan
  • Your responsibilities

Download our ebook (PDF)

Borrowing basics

When managed sensibly, borrowing is a great way to access extra money to pay for things you want or need.

In its simplest terms, borrowing money means entering into a contract where you agree to accept a set amount of money and pay those funds back with agreed terms.

Those terms include details of the repayment, time it will take to repay the funds, payment schedule, and interest you will pay to borrow the money.

Common types of borrowing

Personal loans

Personal loans are handy for unexpected or larger than usual purchases, such as car, recreational vehicle, or debt consolidation. Personal loans will have a significantly lower interest rate than credit cards.


Mortgages are a long-term loan to purchase a home or recreational property. Our mortgage products can be used with home equity to purchase a car or fund home renovations.

Credit cards

These are higher interest lending products that are used for everyday purchases. Many provide additional benefits, such as reward points. Interest is owed on balances outstanding.

Lines of credit

A pre-approved loan up to a certain limit that is available when you need funds, for example for a travel emergency, car repairs, or to take advantage of one-time deals and bargains.

Understanding your credit report

Your credit report determines your credit-worthiness and credit history. Credit checks are conducted by lenders when you are looking to obtain credit. They inform the lender of your past performance in meeting your financial obligations. As one step in the process of conducting a credit check, the lender will contact the local credit bureau.

As a consumer, you have the right to know what information is on your file with the credit bureau. It’s a good idea to check it periodically to be sure that this information is correct. You can visit the Equifax Canada website for your personal, accurate information.

Visit Equifax Canada

Tips for smart borrowing

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Spend wisely

Be careful not to let the convenience of credit lure you into unwise spending. Credit isn’t free money and all purchases done using these methods should be completed with caution.
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Boost your savings

How do you build savings, have money for emergencies, and pay regular expenses? A Line of Credit is there for when you need it, and doesn’t cost you anything when not being used.
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Contribute to your RRSP

Increasing your contributions each year reduces your taxes owed, could provide a return, and sets you up for a better retirement. RRSP loans can be beneficial if paid off quickly.
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Take advantage of deals

Those hot deals on big items don’t always fall when they should. It can be advantageous to take out a small loan when it’s on sale, saving you money.
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Think long-term

Your big purchases such as a house require a long-term financial commitment. Consider the monthly payments added to your expenses, while still giving yourself some breathing room.
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Have a budget

All of life's financial choices can come down to solid budgeting. Having a household budget that grows with your changing needs will make all the difference.

How much should you borrow

There are many considerations before you borrow money, including how much you can afford to borrow. Although everyone's situation is different, a general rule of thumb is to not extend your borrowing over 40% of your gross monthly income.

Only borrowing what you need, not just as much as you can get, is the best way to ensure you don’t overextend yourself. Establishing a budget will allow you to see the whole picture and make it easier for decision-making and long-term planning.

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Download your complete guide to borrowing

Get more tips and techniques for smart borrowing with our guide, including:

  • Understanding your options
  • Applying for a loan
  • Knowing your responsibilities

Download our ebook (PDF)

Learn more about getting your finances in shape


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Smithers Branch

3894 1st Avenue
PO Box 3729
Smithers, BC
V0J 2N0
250 847-3255
Hazeltons' Branch

4646 10th Avenue
PO Box 159
New Hazelton, BC
V0J 2J0
250 842-2255

Houston and District Branch

2365 Copeland Avenue
PO Box 1480
Houston, BC
V0J 1Z0
250 845-7117
Lakes District Branch

117-35 Lakeview Mall, Hwy 16
PO Box 1029
Burns Lake, BC
V0J 1E0
250 692-7761

1139 Main Street
PO Box 2380
Smithers, BC
V0J 2N0
866 811-1110

3894 1st Avenue
PO Box 3729
Smithers, BC
V0J 2N0
250 847-7936


3350 10th Street
PO Box 369
Houston, BC
V0J 1Z0
866 811-1115

2367 Copeland Avenue
PO Box 1480
Houston, BC
V0J 1Z0
250 845-7977

3872 1st Avenue
PO Box 3637
Smithers BC
V0J 2N0
250 847-7933
Member Services Contact Centre

3894 1st Avenue
Smithers BC
V0J 2N0
1 877 847-2828

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