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The Bank of Montreal offers several personal loan and line of credit solutions that can aid borrowers with their cash needs. While the features available differ between products, and will be dependent on the individual borrower’s specific circumstances and project requirements, BMO offers competitive rates and outstanding service. Before securing a loan or a line of credit, conducting a thorough comparison and adequately assessing one’s needs is prudent.
Bank of Montreal Personal Loans Offerings
The Bank of Montreal offers personal loans with a variety of flexible features. Some of the highlights of these loans are as follows:
- Loans starting at $5000, with higher amounts available
- Loan duration of one to five years
- Structured as fixed or variable interest rate loans, with better rates available for excellent credit
- No pre-payment penalty, with flexible payment timing (ranging from weekly to monthly)
BMO also offers life and disability insurance to its borrowers on the loans it makes to give the borrower added protection in the event of unforeseen issues. In addition, the bank is willing and able to work with its customers to customize the specific terms to accommodate special needs when appropriate. For example, if the borrowing purpose meets certain criteria, an extended amortization schedule can be made available.
Personal Line of Credit
A Bank of Montreal personal line of credit requires a borrower to fill out an application, get that application approved, and then provides the borrower with a revolving line of credit that can be used at any time. The basic feature of a revolving line of credit which differentiates it from a personal loan is that where a loan is funded in its entirety upon approval, a line of credit is available but unfunded until it is drawn against. For example, if a borrower is approved for a line of credit for $5000, he or she may wait several months and then draw $2000 for a given process. At the time of that withdrawal, the interest rate that is associated with the line of credit will begin to be applied, but not before.
Some of the key features of a BMO line of credit include:
- Lines of credit of $5000 or more
- A variety of convenient ways to access the money in the line of credit
- No penalty for pre-payment
- Monthly payments of $50 or 2% of the outstanding balance, whichever is higher
- The ability to use the capital that has been made available over and over again
The other advantage of a personal line of credit is that it allows for a less specific loan purpose. With a personal loan, the borrower must specify and justify the need for and use of the capital. With a line of credit, the general use is often required, but it is often less specific. This provides an added level of flexibility that can be useful to some borrowers.
Insuring a Bank of Montreal Personal Loan
An attractive option available from BMO is creditor insurance that protects the borrower against death, disability and even job loss. While insuring one’s loan is of benefit to the lender as well as the borrower, it can help to protect a borrower in the event of unforeseen hardship. Some of the critical features include:
- Coverage of monthly loan payments in the event of injury, disability, or involuntary job loss
- $3000 per month coverage for home equity lines of credit and $1500 for other revolving lines of credit
- Multiple parties may be covered, with a maximum of two covered parties
For coverage up to $50,000, no special medical certification is required
- Excludes pre-existing conditions for 12 months
- Available for Canadian residents between 18 and 54
- Excludes self-employed individuals
- Excludes those aware of pending unemployment
One of the advantages of this type of coverage is that the premiums are directly tied to one’s outstanding balance. The less of a balance that one has outstanding, the lower the premiums. This has the advantage for BMO of encouraging its borrowers to be responsible in managing their balances. It has the advantage for the borrow of not having to pay for coverage that one is not using. While nobody expects to be injured or to become unemployed, by offering this feature of its loans, the Bank of Montreal forges a close relationship with its customers to protect his or her financial future. It is prudent to carefully consider all of the various options that are available and to consult with a BMO financial professional in crafting a comprehensive plan that is right for you. With competitive rates and quality service, an attractive option can be assembled.