Instant Loans in Canada: Choose the Best Lender for You
The digitization of the financial sector has dramatically reduced application approval times for a number of credit products, and many lenders can now process personal loan applications within 24 hours. These unsecured loans can be a good solution for people who need fast cash access to cover an urgent expense, to consolidate high-interest debt, or to just get some breathing room for their financial concerns.
Potential borrowers should note that not all lenders offer equally favourable terms, so it’s advisable to check out several options rather than applying to the first lender you encounter. It’s also important to realize that many lenders swap between terms like “same day loans” and “instant loans,” but these are typically different than loans commonly referred to as “payday loans.” Payday loans let you borrow less and require repayment by your next salary, while same-day/instant loans typically allow for higher loan limits and more flexible repayment schedules. Many of the benefits are the same, though, such as the ability to get pre-approved without a hard check or good credit, avoidance of heavy paperwork, and no collateral requirements.
In This Article:
Online Same-Day Loan Lenders Compared
|Loan Amount||APRs||Term Length|
|Loans Canada||$500 - $300,000||3% - 46.96%||3 - 60 months|
|LoanConnect||Up to $50,000||10% - 46.96% APR based on personal credit||12 – 60 mo.|
|AfterLoans||$500 - $5,000||19.99% - 55.00%||6 – 36 mo.|
|LendDirect||$1,000 - $15,000||Up to 46.93%||Varies by lender|
How to Choose a Good Same-Day Loan
Before you begin to check out the various same-day lenders in Canada, it’s a good idea to get acquainted with the loan features that differ from one lender to the next. Remember, reputable lenders should offer loan terms that are mutually beneficial to both lender and borrower. With that in mind, the first rule in finding a good instant loan is to learn to spot and avoid predatory lenders.
All lenders should make the terms of their loans transparent before asking you to sign, so read carefully to ensure that they haven’t switched out the words “annual” or “yearly” for “monthly” or “nominal” when referring to the interest rate. Another thing to always look out for is the list of fees that are charged for certain actions taken by a borrower. If the list is sparse or missing outright, you should probably avoid the lender in question. Most loans come with some fees, and if a lender appear to be intentionally hiding its fees, that’s probably a sign that the fees are above average or unnecessarily high. Some may even charge a fee for having low credit!
Predatory lenders also tend to convince borrowers to refinance existing debts or even to put up their home or car as collateral when it isn’t required. This is called “equity stripping” and is just another way for these bad lenders to squeeze as much as they can out of their borrowers. Finally, the number one sign of a predatory lender is simply when they try to pressure you into taking on loans that aren’t in your best interest. If you’re looking for a short, fixed-rate loan and the only offers are for adjustable-rate or long term, you should reconsider. Sometimes you’ll be pre-approved for the loan you want, only for the lender to switch it out last-minute for a more expensive option.
Optimizing Your Loan
Obtaining a loan is supposed to be a financial benefit—it’s not meant to make life harder. Only you understand your financial situation, so for any loan it’s important to pay close attention to factors like the interest rate, term length, fees, prepayment penalties, and any add-on products or services.
For example, if you need a fast loan online and plan on paying it back quickly, then it’s crucial to choose a loan that has no prepayment penalties, even if it has a high interest rate or unsuitable term length. If you think you’ll take a while to pay back the loan, then opt for one that has the lowest annual percentage rate, and longest term. Even among same day loans it’s easy to find variety between the elements involved.
The Best Same-Day Loans in Canada
Loans Canada helps borrowers access anywhere from $500 to $300,000, with the lenders on their platform offering interest rates that start from 3%. Prospective borrowers can access terms that range between 3 months and 5 years, though terms do vary by lender and of course, credit. What doesn’t vary is the speed at which potential borrowers are connected with cash—and in many cases you’ll see it hit your bank account just in a day.
Loan amounts can be up to $50,000, and LoanConnect’s only hard requirements for its platform’s users are that they be the age of majority and Canadian citizens: no proof of employment or income needed. Even applicants who have current outstanding loans or past consumer proposals can find lenders among LoanConnect’s network. Repayment terms are set by the individual lender and last from 12 to 60 months.
AfterLoans might be a good fit for those seeking smaller loan amounts, between $500 and $5,000, and approval within 24 hours. It’s a loan search platform/aggregator rather than a direct lender, and its lending partners offer other products aside from fast unsecured loans, including installment loans, home improvement loans, secured loans, and more. All you need is an ID and proof of income, and an approved 10-minute application will result in funds hitting your account within a day.
Other notable advantages include the absence of any prepayment penalties, which allows you to be rid of the loan as soon as possible without paying extra fees. Would-be borrowers should be aware of the interest rate they’re getting, as partner lenders associated with this platform charge between 19.99% and 55.00%, with term lengths between 6 and 36 months. Those with past or current bankruptcies can apply.
Like with some other lenders, you’ll need to show proof of recurring income during your application. LendDirect will also allow you to make automatic payments from your bank account in order to avoid missing one, but if you prefer to pay manually and are worried about being delinquent, it offers a Loan Protection plan for an extra monthly fee (covering you in the case of missed loan payments).