What kind of loan can you get with bad credit?
Since banks seem to only lend money to customers who have good credit, what options exist for bad credit situations? Generally, there are two:
1. Payday Loans
Payday lenders may try to rope you in with the promise of guaranteed approval, but don’t go there. The turn-around is extremely quick and the amount they lend rarely goes over $1,500. If you’re in the market for a loan, chances are you’ll need more than that and with a much longer repayment period. The worst part? The APR of a payday loan is usually well over 300%! Payday loans are even illegal in some provinces, and for good reason.
To help you understand the extraordinary cost involved, the government of British Columbia has a payday loan calculator that makes it easy to see that you're not getting a good deal.
2. Personal Installment Loans
If you need to get a personal loan with bad credit to cover an urgent expense, the smartest option is to get a loan from a trusted online lender.
Even if you have bad credit, a personal installment loan from a direct lender is much easier to get than a traditional bank loan and offers much lower interest rates and more manageable repayment periods compared to payday or no credit check lenders.
Ready to apply? Click here to go straight to the application and get approved for your personal loan today!
Can I get a personal loan with no credit check & guaranteed approval?
It is possible to get guaranteed approval for a personal loan with no credit check. But there are a few warning signs you should keep in mind if you’re looking for a “sure thing”. Remember, it always comes at a high cost to the borrower and it's almost never worth it.
Their fees or interest charged may be extremely high, or they may require collateral upfront to secure the loan. You don't need to resort to these high-risk and high-cost lenders. So long as you meet sufficient income requirements, a personal installment loan from a trusted lender is available to you, even if you have bad credit.
What’s considered sufficient income for a personal loan?
While banks rely heavily on your credit score, some lenders will look at other factors such as your employment and income. If you have sufficient income to pay back the loan, it's easier to get approved for a loan today than it ever was. Every financial institution will have its own requirments, but typically, a minimum income of $1,200 per month before taxes or deductions (i.e. CPP, EI, etc.) is needed to qualify when you have bad credit.
To put your income requirements into perspective, here’s a breakdown:
At least $285 per week (before deductions)
At least $570 every two weeks (before deductions)
At least $1200 per month (before deductions)
How to get a personal loan with bad credit
Today, trusted online lenders leverage e-transfer technology to make loans more accessible to bad credit customers than they ever were before! If you need cash in a hurry but have low credit, here are a few tips to help you get approved without delay:
- 5 Minutes
What you’ll need:
- Proof of Employment
- Bank Statements
- Mobile Phone
Find a lender that can help
If you’re approaching lenders with a bad credit history, find one that specializes in working with clients such as yourself. Know what the lender’s eligibility criteria is before applying because it varies among financial institutions. Credit unions, for example, can be more stringent about who they lend to versus a lender like Fresh Start, that can work with customers of all backgrounds and financial situations.
Show your income
When it comes to fast-tracking ways to get that personal loan, here’s a key phrase to remember: know and show your income. As mentioned, applicants typically need a monthly income of $1,200 to qualify for a personal loan. If you’re not sure about your income, check your bank statements and pay stubs to get an accurate figure. If you’re coming up short, don’t forget to include whatever government income you are receiving. It usually counts towards your monthly income. And you can prove your income by taking photos of any non-sensitive documents with your smartphone and sending them via email. Now that's convenience!
Do you have a cosigner?
If you’re under that $1,200 monthly income threshold (including any government income you receive) then you may need to find a strong cosigner. A cosigner is a trusted friend or family member who agrees to share the responsibility of your loan. The cosigner should have a decent income and a good credit score.
Can you offer collateral?
In some instances, a lender might be willing to accept collateral to secure your loan application. Examples of collateral would be the title of your car or possibly home equity if you have it. However, this is not advisable and should only be considered in emergency situations. Remember you are putting a valuable asset at risk, and if something goes wrong and your ability to repay the loan is compromised, you could lose that asset.
Get a bad credit personal loan from Fresh Start Finance
At Fresh Start Finance, we believe that personal loans should be simpler, faster, and more convenient than a bank. Here's why more and more Canadians are choosing us:
- Any credit welcome: Good credit? Bad credit? No Credit? We're here to help ALL Canadians in every province & territory get the urgent cash they need.
- Fast online application: We know you don't have time to waste. Apply within minutes, get approved in a few hours. Money can be wired to your bank account on the same day!
- No appointments required: Fresh Start Finance is completely online and available 24/7. Talk to us by phone or email any time!
- Borrow up to $15,000: Our loans start at $600, all the way up to $15,000.
- No hidden fees: There’s no such thing as application fees or maintenance charges.
- Build credit: Unlike payday & no credit check loans, a personal installment loan from Fresh Start is a great credit-building tool that can help rebuild your credit score with positive payment history.
- Trusted lender: Check out the reviews on Trustpilot to see how Fresh Start Finance has helped Canadians across the country.
Apply today in 3 minutes and get the funds e-transferred to your bank account today! Click here to get started.