Same Day Personal Cash Loans

Can I really get a loan the same day?

Emergencies can happen to anyone and everyone. When they do happen, they normally come unannounced. Whatever the nature of this emergency though, these are the times when you may need liquid cash urgently. The same day loan, as the name suggests, provides these funds to you on the same day as you complete the application. Over the course of this article, we will explore how to obtain one, and the factors that need to be weighed before deciding if this is the best financial solution for your needs.

How Same Day Loans Work?

The mechanics of the loan themselves are pretty easy to understand. Most of these loans are available on the Internet, wherein the application process can be completed online, through a call or through an app from inception to completion. Unlike personal loans from a retail bank for example, these loans may be easier to qualify for, even though it may cost extra in terms of interest rates. Therefore, by having a shorter application process, these  loans can have approval decision for customers in as little as 5 minutes.

Once the approval decision is made, the customer then receives a notification regarding the terms of the loan (i.e. the maximum principal that can be borrowed and the rate it will be lent out at). If these terms are agreeable to the customer, then they can select the loan and the funds are deposited from the lender into the borrower’s bank account within the day.

Repayment thereafter depends on the type of loan that is extended. It can be a few months or a few years. The most common type of this loan used by consumers is an instalment cash loan, wherein the funds are repaid at regular intervals over the term of the loan. Another common type of loan is called the title loan, where the borrower pledges asset collateral (e.g. a car). During the life of the loan, the title of the asset is passed to the lender. Once the loan 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 Numerical Example

Despite the fast application process and fund receipt, it is important to understand how the math works in terms of interest rate and total cost of the loan. Below are a couple of examples of different loan amounts and interest rates, so you can see what the monthly payments work out to. 

The difference can be seen below:

Loan with principal of $10,000 for 1 year, 6% per year – Monthly repayment: $860.66

Loan with a principal of $5,000 for 1 year, 21% APR – Monthly repayment $931.14

How to Qualify for a Same Day Loan?

In most Canadian provinces including Ontario and Alberta, the minimum requirements include the prospective borrower being at least 18 years of age with a checking account within a Canadian financial institution and a steady source of income.

The checking account is primarily a tool for the deposit and withdrawal of funds during 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 to ensure that the lender retains some level of comfort that the loan will eventually be repaid. While part-time jobs are acceptable under this requirement, a job that the borrower has only commenced recently might be cause for potential non-approval.

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.

Some of the primary advantages offered are:

Things to Watch for with Same Day Loans

Despite these seemingly compelling benefits though, there are also downsides that cannot be ignored. When making a final decision, consumers would do well to remember these:

Same Day Loan Uses

For both individuals and businesses, there are a range of usage applications of the same day loan. In cases where time is critical, and funds need to be acquired immediately to make a payment, the day loan stands out in comparison to other types.

While there are no specific conditions with regards to the usage of this loan, individuals most often use it for emergency expenses including:

• Medical bills (possibly while they are waiting for insurance funds to arrive)
• Car repairs (if access to a vehicle is absolutely necessary)
• Home repairs (if there has been an accident or natural disaster)
• Unpaid utility bills (if the utility is going to be cancelled soon if unpaid)
• Assorted expenses when the borrower does not have liquid cash on hand

In a similar vein, businesses might also use the loan for a variety of purposes. Most often, this has included:

• Paying off suppliers (when the 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 soon if unpaid)

Same Day Loans FAQs

How can same day loans be paid back?

Different lenders have a variety of different preferred repayment methods, some of which include post-dated checks, automatic payments credited directly from the bank account, and/or cash settlement on a pre-defined date.

What is the maximum amount that can be borrowed under these loans?

It 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 types of surprises should I keep watch for?

These loans may often come with fees regarding certain aspects like: early repayment penalties, administrative fees, missed payment fees etc. At the outset of gaining the funds, it is important to read the requisite documents to make sure that you understand all fees that you could be on the hook for.

What happens if I miss a payment?

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 it 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 if I have bad credit?

Yes. While there is no guarantee of being approved, borrowers with poor credit may apply for these loans.

What are the requirements for getting a same day loan?

Same day lenders understand that it’s hard to prepare so many documents if you need a fast loan. The vast majority of Canadians have the necessary documents needed for this loan type. Usually, all you need to apply is a government-issued ID and proof of income.

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 to get it. Many same day lenders can transfer you the funds in a couple of hours.