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Living with a disability can be challenging. These challenges can extend to financial matters due to the inability to work or the stress of expensive medical bills. We at Smarter Loans understand this and have curated a list of loan companies that can help.
You can apply for a personal loan here at Smarter Loans and we will find a suitable lender for you.
As your disability benefits come in known, regular and predictable installments, you can apply for and receive a loan based on them – where they are essentially treated as a form of income. In this way, a disability benefit loan is a lot like other types of income-related loans. But as disability benefits tend to be small, the loans associated with them are also on the smaller side. Most commonly, they come in the form of payday loans.
Canada has multiple disability benefits programs, with varying amounts, available, depending on:
There are both federal and provincial benefits, tax benefits, as well as some government loan forgiveness programs for those with disabilities. As this is such a complex and ever-evolving area, Canadians are encouraged to check for the latest benefits that may be available to them here. But for an idea of the scale we’re talking about, the basic CPP disability program amount is $510.85 per month, the average is $1031.55, and the maximum is $1413.66.
So your disability benefits can count as income, but it’s important to note that this doesn’t necessarily help you get a loan from anywhere. Most lenders will take into account your disability income as just one part of your wider financial profile, but will also need you to meet credit score, financial history, downpayment and potentially other eligibility criteria before approving you for a loan.
To receive a loan on solely the basis of your disability benefits, you’ll need to look at some less traditional lenders. Your options include:
Payday lenders only need proof of income (from any source) to provide small, short term loans. Payday loan amounts range from $100 to $1500, and usually only last a few weeks. However their interest rates are very high, and so these loans (while easy to qualify for and convenient to access) are only really appropriate for emergency situations, where you know you’ll be able to pay the money back before interest becomes punitive.
An alternative to payday lenders are alternative lenders such as online lenders, who sometimes offer disability benefit loans in the form of small personal loans, installment loans or lines of credit. These may be harder to qualify for than a payday loan (for example, they may need to check your credit score), but generally loan amounts are larger ($1000 to $20,000) and longer term (up to five years), and the interest rates involved are much lower. They can also come with other advantages – for example, with a line of credit, you only pay interest on what you actually use, even if you were approved for more, and you can have an open-ended loan term. So if you have the ability to get one of these loans, it will cost you less in the long term.
To receive a disability benefit loan, you must meet the eligibility criteria of your chosen lender. These vary, but at a minimum include being able to prove:
Some lenders may also want to check your:
To apply for a disability benefits loan, you must:
Yes, usually. Not all disability benefit loans will accept poor credit borrowers, but payday loans and other forms of cash advance loan usually do not take into account credit score.
That depends on your exact situation and how much you receive in overall income; loans between $150 and $20,000 are in theory available.
Yes. It doesn’t matter where your benefits come from, as long as you can show you will continue receiving them.
This depends on where you get your loan and the loan type. Interest rates can vary from 8% to over 500% (for the most punitive types of payday loan).
No, this is illegal. Your interest rate will be based on the factors in your loan application, just like everyone else.
Yes. Receiving disability benefits counts as a form of income, so many disability benefit loans will not worry if you are unemployed – as long as you can prove your benefits will continue.
No. Any loan you have will have zero effect on your disability benefit eligibility and payment level.
The Smarter Loans Staff is made up of writers, researchers, journalists, business leaders and industry experts who carefully research, analyze and produce Canada’s highest quality content when it comes to money matters, on behalf of Smarter Loans. While we cannot possibly name every person involved in the process, we collectively credit them as Smarter Loans Writing Staff. Our work has been featured in the Toronto Star, National Post and many other publications. Today, Smarter Loans is recognized in Canada as the go-to destination for financial education, and was named the “GPS of Fintech Lending” by the Toronto Star in 2019.
Amy Orr is a professional writer and editor with over 10 years of experience in the Canadian, U.S. and U.K. financial markets. She has written for numerous publications on topics as diverse as economic literacy, corporate finance, and technical analysis of numerical data. Prior to transitioning to full-time writing, she worked in the hedge fund sector. Her academic background is astrophysics, and she has a Masters in Finance from the University of Edinburgh Business School.
Jenna West is Smarter Loans' in-house financial writer and content director. She has been covering the Canadian FinTech and finance industry since 2017, including financial trends analysis, industry surveys, regulatory updates and changes in Canadian consumer behaviour when it comes to finance.
