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- Can I Get a Same Day Loan in Canada?
- How Do Same Day Loans Work?
- Same Day Loan Terms
- Same Day Loan Example
- How to Qualify for a Same Day Loan
- Same Day Loans and Bad Credit
- How to Apply for a Same Day Loan
- Where To Get a Same Day Loan
- Benefits of Same Day Loans
- Risks of Same Day Loans
- Same Day Loan Uses
- Same Day Loan FAQs
Can I Get a Same Day Loan in Canada?
Emergencies can happen to anyone, and by their nature are impossible to prepare for. So it's no surprise that sometimes people need a cash advance to deal with an unexpected situation. Because of this need, same day loans are a relatively common occurrence, and thanks to modern technology, they are truly same day - meaning funds will be deposited into your bank account on the same day as you submit the loan application.
How Do Same Day Loans Work?
The mechanics of same day loans in Canada are pretty simple, and on par with other types of personal loan. Most are available remotely - meaning the application process can be completed online, through a call, or via an app, from inception to completion. Some basic personal data is required, and once submitted, the lender will assess whether they are comfortable lending the requested amount to the applicant. This is where same day loans diverge from other loans, as this decision-making process is significantly faster with express loans than with loans available from, for example, retail banks.
Part of this speed comes from the eligibility requirements for same day loans being less rigourous than for other types of financing. They are easier to qualify for, and so easier to approve.
Once an approval decision is made, the applicant then receives a notification regarding the terms of their financing. If these terms are acceptable, then they can agree by signing the proffered loan agreement, and the loan amount will be deposited by the lender into the borrower's bank account within the day, usually by direct deposit or e-transfer.
Same Day Loan Terms
As mentioned above, the borrower must agree to the terms offered by the lender in the loan agreement. These terms can vary quite a bit, so it's important that you understand what these terms are and how they might differ from other products.
Interest Rates
Let's start with one of the most important factors in any credit product - the interest rate. Interest rates for same day loans tend to be higher than for other loans, as they are a convenience product, and so lenders can charge more for them. The interest rate you will be charged depends on both your own personal circumstances and the lender you apply to, but rates can vary from 10% to nearly 50%.
Loan Amount
Same day loans tend to be for smaller sums than other, more structured loans; you can typically borrow anywhere from $500 to $1,500, although some options are available (for those who qualify) for loans up to $50,000. And because same day loans tend to be smaller, you will not need to provide any collateral.
Fees
Most loans come with some fees; these can vary lender to lender, but can include:
- Origination fees
- Processing fees
- Administration fees
- Early repayment penalties
- Late payment penalties
- Legal fees
Make sure you account for the fees your chosen lender charges when calculating how much your funding will cost - especially if you're only borrowing a small sum.
Loan Length
The very nature of same day loans is that they are needed for emergencies, and are not intended for long term use. So most same day loans have short terms - from a couple of weeks to a couple of months. There are however some longer term options for those who borrow more, and loans for up to 5 years are available. But you should bear in mind that interest charges will add up quickly over long time periods, and other loans might be more cost-effective in the long run. Remember to compare the annual percentage rate (APR) of each option you are considering, so that you can see how loans of differing terms compa
Repayment Terms
The most common type of same day loan is an installment loan, where funds are repaid at regular intervals over the term. The loan offer you receive will explain how much these monthly payments are, principal plus interest, so you can see if you are able to afford the payments.
Another, less common type of same day loan are title loans, where the borrower pledges an asset as collateral (e.g. a car). During the life of the loan, the title of the asset is passed to the lender. Once the money is repaid in full (including interest), the title is then returned.
To learn more about short term loans, please check out this resource from Canada.ca.
Same Day Loan Example
Even in an emergency, it's important to understand how much a cash loan will cost you. Below are a couple of examples of different loans so you can see how the monthly payments shake out:
How to Qualify for a Same Day Loan
In most Canadian provinces, the minimum requirements for same day loans are:
- Being age of majority in the province of residence
- Holding a bank account with a Canadian financial institution
- Being able to prove you have a steady source of income
A bank account is necessary for the deposit and withdrawal of funds during the funding and repayment stages, respectively. At the borrower's option, the funds can be automatically extracted from their accounts on the date of their next payday, to avoid the late payment fees that can accompany these loans.
The income requirement is there to reassure the lender that their money will eventually be repaid. While part-time jobs are acceptable under this requirement, a job that the borrower has only commenced recently might be a cause for non-approval.
Same Day Loans and Bad Credit
You may be wondering whether it's possible to get same day loans with a bad credit score, or even if it's possible to get loans with no credit. This really depends on the lender you choose and the rest of your financial situation. Some same day lenders do perform a credit check when assessing applications, and some have minimum credit score requirements.
More commonly though, a credit check is not performed, either because the lender relies instead on income information rather than credit, or because the lender offers loans to bad credit borrowers inclusively.
If you're worried about the effect your credit history may have on your options, don't panic. There are providers who can help - it just may mean a lower maximum principal amount, or slightly longer loan process, a collateral request, or perhaps just a higher than average interest rate. And for those with no other options, payday loans are available on a quick turnaround time.
How to Apply for a Same Day Loan
Applying for the vast majority of same day loans is simple.
Step One: Gather Your Documents
The paperwork you'll need for a same day loan application is minimal, but usually includes:
- Government-issued ID
- A bank account statement
- A pay stub or other proof of income
- Proof of address (e.g. a utility bill)
Step Two: Complete the Application
For most same day loans, you will be able to complete your entire application online; simply answer the questions in the application form honestly, and include all of the supporting documents asked for.
Step Three: Sign Loan Documents
Once you've submitted your application, you need to wait for a response. Approval will come in the form of a notification, together with loan documents, and a loan agreement that you must sign if you wish to proceed with the loan.
Step Four: Receive Funds
Once the lender has received the signed loan documents back from you, they will be able to release funds directly into your bank account, usually within just a few hours.
Where To Get a Same Day Loan
Although personal loans are available from banks and credit unions, online lenders are the best bet when considering a same day loan, as they are able to move much faster than other providers. You can see a list of the most reputable companies in the table at the top of this page; these companies have been vetted for reputability, so you should feel no qualms about pursuing a loan through one of them.
If you are uncertain about using an online lender, other fast cash options exist, but these may not offer competitive interest rates or the same repayment schedule options as dedicated same day loan providers.
Choosing a Same Day Loan Provider
Choosing the right same day lender for you depends on your circumstances and needs, but you can never go wrong by following the below guidelines:
- Understand your financial position, including how much you need to borrow, what you can afford in terms of repayment, and if you meet any eligibility criteria (e.g. credit score)
- Research lenders that offer products that meet these needs
- Compare multiple lenders, remembering to look at their rates and fees and how much they'd cost you overall
- Once you have found a competitive option, check the lender's reputation - via customer reviews, ratings, complaints, etc. You can also get a good sense of whether a lender is responsible by seeing how transparent they are about their costs
- If you're comfortable with the lender's reputation, speak to a customer service agent to get a detailed quote
By following the above, you are more likely to find an affordable loan from one of the many responsible lenders, rather than a disreputable company. And if you're ever in doubt, remember to avoid any company that:
- Does not make it easy to find vital information (e.g. interest rates)
- Does not have basic company details, such as an address or a registration number
- Charges a fee for application or approval
- Boasts a 100% loan approval rate
- Employs sales people that cannot answer your loan questions or who push you to take on a loan
Benefits of Same Day Loans
For cash-strapped borrowers who need instant liquidity to fund an immediate and/or emergency expenditure such as a medical bill, the appeal of this loan is clear. However, there are other advantages, such as:
Risks of Same Day Loans
Despite these compelling benefits, there are some downsides and risks to same day loans that cannot be ignored. When choosing a loan product for you, it's vital you understand these potential pitfalls:
Same Day Loan Uses
For both individuals and businesses, there are a range of applications for same day loans. While there are no specific conditions with regards to the usage, individuals most often use them for emergency expenses, such as:
- Medical bills (possibly while they are waiting for insurance funds to arrive)
- Car repairs (if access to a vehicle is absolutely necessary and your car breaks)
- Home repairs (if there has been an accident or natural disaster)
- Unpaid utility bills (if the utility is going to be cancelled)
- Assorted expenses when the borrower does not have liquid cash on hand
In a similar vein, businesses might also use fast cash loans for a variety of purposes, such as:
- Paying off suppliers (when credit terms are almost over)
- Increasing working capital (to fund day-to-day expenses)
- Paying unpaid wages (to ensure workers continue working)
- Repaying unpaid utility bills (if the utility is going to be cancelled)
Same Day Loan FAQs
How can same day loans be paid back?
Different lenders have a variety of different repayment methods, some of which include post-dated checks, automatic payments credited directly from your bank account, and/or cash settlement on a pre-defined date. Some may allow more flexible loan payment terms, such as a non-standard pay frequency, or payments made via e-transfer.
What can I use a same day loan for?
Anything you like - there are no restrictions.
What is the maximum amount that can be borrowed with a same day loan?
This varies from lender to lender, but typical same day loans are between $500 and $5,000. Each lender has their own restrictions concerning the cap on the amount available to be lent out. This is also a function of the borrower's income and collateral. The higher the income and/or level of collateral posted, the higher the lender will be willing to go in terms of principal amounts lent.
What happens if I miss a payment on my loan?
A representative of the lender will contact you and ask for the payment to be made. If it cannot be made, then there is the option of a loan extension. Failing that (e.g. if the borrower is delinquent), then the credit score will be impacted for up to 5 years, and the lender may choose to take additional legal action.
Can I use a same day loan to repay existing debt?
Yes, you can use a same day loan to consolidate other debt. However, make sure that your final outstanding debt is less expensive than the debts you are paying off with the new loan.
Can I apply for a same day loan if I have bad credit?
Yes. While there is no guarantee of being approved, borrowers with bad credit may apply for these loans.
What are the requirements for a same day loan?
Usually, all you need to apply for a same day loan is government-issued ID and proof of income. In addition, you must be at least 18 years old. Each lender will assess you by their own standards, but if you are an adult with an income, it should be easy.
Can I get a same day loan online?
Absolutely!
Are same day loans the same as payday loans?
No. Although many payday lenders offer fast turnaround times for cash loans, the terms of payday loans can be far more punitive than with their same day counterparts. Payday loan amounts are generally smaller (capped at $1,500), and the entire payday loan must be repaid in one lump sum, on your next payday. In addition, interest rates are higher on payday loans, and eligibility requirements are more lax.
Do I need a bank account to borrow money asap?
Yes, most lenders - and every online lender - will require your bank account details so that they can deposit funds automatically into your account via direct deposit or e-transfer.
Written by:
Amy Orr
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.
Reviewed by:
Jenna West
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.
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