While the internet is littered with companies offering guaranteed approval loans if you have bad credit, the reality is that this is not true.
There is really nothing like a “guarantee” when it comes to getting approved for a loan, especially if your credit score is dinged and battered.
Depending on your needs, you may be able to apply for bad credit loans online from platforms like LoanConnect, Loans Canada, and Loanz.
Whether or not you are approved for these online loans depends on your credit score, employment status, and overall finances (including your debt-to-income ratio).
Sometimes, secured personal and guarantor loans are seen as “guaranteed” or “instant” approval loans.
This is only true to an extent. While your credit score may not factor into your application getting approved, other factors come into play. For instance, you may need to have someone with a good credit score act as a co-signer on your loan contract.
With respect to a secured loan, you are required to provide collateral. The same goes for a secured credit card.
If you can find an eligible guarantor or have a down payment to secure your loan, your approval rate goes up (up to 95% with some lenders).
One final loan option often regarded as “guaranteed” is a payday loan. This is not a great option as it is prohibitively costly and does nothing to improve your credit score.
Guaranteed Approval Loans in Canada
If you want to get approved for a loan with bad credit, your best bet is to use an online loan search engine. These loan rates comparison sites work with multiple lenders, and they can help you shop for different types of lenders, including:
- Traditional banks
- Credit unions
- Alternative lenders
Also, they give you access to lenders in various locations so you can apply from wherever you live, including Alberta, Ontario (Toronto), British Columbia, Manitoba, and elsewhere in Canada.
|Platform||Interest Rate||Loan Amount||Loan Term||Apply|
|Loans Canada||1.99% – 46.96%||$500 to $50,000||4 – 60 months||Visit|
|LoanConnect||5.75% – 46.96%||$500 to $50,000||6 – 60 months||Visit|
|Loanz||29.9% or 46.9%||$1,000 to $15,000||12 – 60 months||Visit|
|Mogo||9.9% – 47.42%||$500 to $35,000||9 – 60 months||Visit|
Best Guaranteed Approval Loans for Poor Credit
An unsecured loan does not require you to provide collateral to secure your loan. This means you won’t need a down payment or be asked to put your home or other assets on the line to get financing.
That said, secured loans often come with higher interest rates, and the lender may require a fair to good credit score at a minimum.
Two options for finding unsecured bad credit loans in Canada are:
1. Loans Canada
Loans Canada has an extensive lender network that accepts loan applications from people with bad credit.
You can use the loan for any purpose, including debt consolidation, car purchase, home improvement, credit building, and more.
- Loan amount: Up to $50,000
- Loan interest rate: 1.99% to 46.96%
Loan terms vary from a few months to as long as five years (60 months).
To get started, complete the short online application process, and they will be in touch to match you with a suitable lender.
The process from application to final funding can be completed in as little as two business days.
LoanConnect is a top destination for personal loans in Canada, whether you have an excellent, good, poor, or bad credit score.
After you have completed the application form, they search through multiple lenders to find the best rates on offer.
- Loan amount: Up to $50,000
- Loan interest rates: 5.75% to 46.96% APR
The rate you qualify for depends on your credit history, how much you are borrowing, and the financial information you provide.
You can pay back your loan between 6 and 60 months.
The loan types available using LoanConnect include cash loans, debt consolidation loans, home improvement loans, regular personal loans, and bad credit loans.
You can learn more about what this company offers in this LoanConnect review.
If you have a steady income and employment, you can apply for a bad credit loan from Loanz. It offers up to $15,000.
Owned by LendingArch Financial, Loanz offers personal loans for those with poor to fair credit. You can be approved instantly and receive your funds in under 24 hours. Loanz offers high approval rates and flexible repayment options.
Interest rate: 29.9% or 46.9%.
Loan term: 12-60 months.
Maximum loan amount: Up to $15,000.
Eligibility: Resident of Canada, the age of the majority in your province or territory, have a chequing account and steady income stream, and not in bankruptcy or collections.
On Loanz’s website
4. Mogo Loan
Mogo is a financial services company offering personal loans ranging from $500 to $35,000, free credit scores, identify fraud protection, and a prepaid credit card.
A Mogo Liquid personal loan can help you pay for various expenses and has a fixed term. To qualify, you must have a net income of at least $13,000 annually.
It is available in British Columbia, Ontario, Alberta, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, and Prince Edward Island.
- Loan amount: $500 to $35,000
- Loan interest rate: 9.9% to 47.42% APR
- Loan term: 9 months to 5 years
Find out more about MogoMoney loans or apply below.
5. Spring Financial
Spring Financial offers same-day personal loans of up to $15,000. The funds are paid out using e-Transfer, and you can receive the cash within hours of applying if you meet the basic requirements.
To qualify for a Spring Financial loan, the eligibility requirements are:
- Minimum $28,000 annual income
- At least 21 years of age
- Permanent resident, valid work permit, or Canadian citizen
The company operates in all provinces and territories in Canada except Saskatchewan, Quebec, and New Brunswick.
The interest rate for loans ranges from 19% to 46.96%.
Guaranteed Payday Loans in Canada
Payday lenders are an option if you are in search of an instant approval loan and you have bad credit. However, we do not recommend them.
Payday loans cost you an arm and a leg, and it is in your interest to exhaust all other options before ever considering these kinds of loans. These short-term loans are nicely packaged, so they look affordable, but they are not.
For example, if you pay $15 per $100 borrowed for two weeks, you effectively pay 391% per year. They often go even higher than that.
The industry is also rife with scammers, and your financial situation can go from bad to worse in no time at all.
At iCASH, you can borrow from $100 to $1,500. The number of repayments you can choose from depends on several factors, including your province and pay frequency.
Usually, you can pay the loan back in two or three monthly or weekly repayments.
You can apply online and get an instant decision. Once you have been approved, sign the contract online and receive a transfer of funds within two minutes.
There is also an additional five-day grace period before you start repaying the loan on your next payday, and it claims that it does not refuse any credit score.
There are some requirements, however. For example, you must have a minimum net income of $800 per month. You must also have worked for the same employer for three months or more.
7. Money Mart
You can get a loan on the same day at Money Mart, which has been around since 1982. Choose from cash advances from $120 to $1,500 or installment loans from $500 to $15,000.
Installment loan terms are from 12 to 60 months, and the APR is 29.9% or 46.9%. You can also apply for small business loans here.
Everything is online, making it quick and convenient, and you can receive your funds in 15 minutes. You will need a steady source of income to apply for a cash advance here.
8. Captain Cash
Captain Cash provides small loans of up to $750 that you can pay back over 120 days. There is no credit check, approval is fast, and everything is done online.
Just choose the amount you want to borrow, then choose weekly or monthly repayments in up to 12 installments. You will then receive your funds by email money transfer.
The APR is 22%, but this depends on your credit rating.
Other popular payday lenders in Canada include:
- National Payday Loans
- Go Day
- My Canada Payday
Instead of a payday loan, consider getting a personal loan, line of credit, home equity loan, or cash advance on your credit card.
You may also benefit from speaking to a credit counsellor.
Guaranteed No Credit Check Online Loans
Online lenders that provide almost instant approval with “no” credit checks generally require you to have a guarantor or collateral (i.e. for a secured loan).
You may come across terms like “95% approval rate”. However, this is only possible because the requirements for approval are more onerous.
For instance, finding a guarantor willing to underwrite your loan by co-signing your loan contract can be challenging.
Similar requirements extend to credit cards for bad credit as well.
LendingMate Guarantor Loans
**LendingMate has stopped issuing new loans** LendingMate offers guarantor loans from $2,000 to $10,000. It does not check your credit score, and 95% of borrowers who meet their eligibility requirements are approved.
Eligibility for a LendingMate loan includes:
- A guarantor with a good credit score; is aged 19-75 years and can afford to cover the loan repayment if you can’t.
- You must be resident in Canada and have no active bankruptcy or consumer proposal.
The interest rate for a loan using this platform is 43% per annum, and you can borrow for 1 to 5 years.
LendingMate is available in Ontario and British Columbia.
What Does “Guaranteed Approval” Mean?
There is some confusion about what exactly a guaranteed approval loan means. Contrary to what you may think, it does not actually mean you will always get approved.
Lenders sometimes say they provide guaranteed approval, but it really means that the lender is more flexible. This usually means you don’t need a perfect credit score or a long credit history to apply for a loan.
There is no way to get 100% guaranteed approval, and you must still qualify for the loan.
There may be specific requirements regarding your credit score. Another requirement is your employment status. For example, a lender may not approve your loan application if you are not in regular employment.
Your financial situation may also have an impact. For example, if your debt-to-income ratio is too high, you may not qualify for a loan.
In general, you should see guaranteed approval loans as loans with more flexible requirements compared to a bank loan. This makes them a potential option if you don’t have a great credit score or history.
How to Apply for a Guaranteed Approval Loan
To apply for a guaranteed approval loan, start by choosing a suitable lender. Compare interest rates, the amount you can borrow and the repayment options to make your decision.
If there is a loan calculator, use this to find out how much you will pay back.
Once you have chosen a lender, you can usually apply for a loan online. Just fill in your details and provide all the requested information, which may include proof of employment.
Once approved, your funds are normally sent to your bank account on the same day and sometimes in a few hours.
How to Increase Your Chance of Getting Approved for a Loan
When you apply for a guaranteed loan, there are a few things you can do to increase your chances of getting approved.
Improve Your Credit Rating
A bad credit score could prevent your application from being successful, so you might want to work on improving it.
Use the free service from Borrowell to check your credit score. If you don’t need the loan urgently, you might want to apply for a credit-builder loan using a tool like the one provided by KOHO.
This way, you can improve your credit score and chances of getting approved for future loans.
Pay Off Other Debts
If you have a high debt-to-income ratio, this could have an impact on your loan application. Try to pay off your other debts first to reduce your debt-to-income ratio to about 30% to increase your chances.
Use a Co-Signer
Find someone else with a good credit score to co-sign your loan application. Of course, they will be responsible if you don’t make your payments, but it reduces the risk for lenders and could improve your chances.
How to Choose a Lender in Canada
If you’ve decided to apply for a guaranteed approval loan, you first must choose a suitable lender. A few are listed in this guide to get you started, so you may want to read through them first.
There are several factors to consider when choosing a lender:
The interest rate will often be quite high for this type of lender, but they won’t all be the same. You may be able to find them on the lender’s website or by using a loan calculator.
Find out how long it can take to pay back your loan. Some may provide loans with longer terms than others.
Find out how long the lender will take to approve your application and provide you with the funds. It may be very quick, or it may take days. If you need the money soon, this will be a factor.
Is it a legitimate lender? You have to be careful about scammers in this space, so only use a lender with a proven track record.
Pros and Cons of Guaranteed Loans
There are several pros and cons to consider if you are thinking about applying for a guaranteed approval loan:
- It’s usually very quick to get access to your funds.
- You can usually apply online, making the process quick and convenient.
- They are a good option for people with bad credit.
- There are lots of reputable lenders to choose from.
- The loans can be very expensive if you don’t make your repayments on time.
- They are only suitable for short-term loans.
- Loan approval is not guaranteed, which can be misleading.
Alternatives to a Bad Credit Installment Loan in Canada
There are several alternatives you may want to consider before you apply for a bad credit installment loan in Canada:
Payday loans are very similar to installment loans. However, they are often for smaller amounts, and you usually repay the money on your next payday or in a few payments.
Loans from Family
You may want to ask a friend or family member for a small amount of money for a loan. Ensure you repay your loan on time to avoid fracturing your relationship.
Secured Credit Cards
If you do not need funds urgently, you may want to apply for a secured credit card. This may or may not be an option depending on your credit score.
You have to deposit money to use this, and you can borrow up to your deposit amount. It is a bit different, but it can be another option for people without great credit scores.
Some credit unions may offer small loans, including payday alternative loans (PALs) or small personal loans. They might also use other information rather than your credit score when you apply.
What is a Bad Credit Score?
Your credit score is a three-digit number that tells lenders whether you are creditworthy. It is computed by the two credit bureaus in Canada (Equifax and TransUnion) and ranges from 300 to 900.
A bad credit score is from 300 to 599, and it signals to lenders that you may have significant problems with paying back any monies they give to you.
A good to excellent credit score tells lenders that you have been paying back debt responsibly, and they may be more willing to give you credit.
Be wary of predatory lenders who try to lure you with the promise of a guaranteed loan.
Popular search terms relating to instant approval and guaranteed loans include:
- Bad credit loans Canada
- No credit check loans online instant approval
- Guarantees approval loans for poor credit
- Online loans no credit check instant approval Canada
- Guaranteed approval no credit check
- Guaranteed payday loans in Canada, and more.
Before signing any loan contract, ensure you understand what is written in the fine print, including the interest rate you are paying, penalties for not making payments on time, and associated fees (e.g. origination fees).
You should also confirm that they will report your payments to the credit bureaus so that you can start to rebuild your credit score.
Guaranteed Approval Loans FAQ
You can qualify for a regular installment personal loan; however, the requirements vary by lender, and some will require you to provide a guarantor or collateral. If a guarantor is required, the loan is referred to as a guarantor loan. If you need to provide collateral, it is a secured loan.
The lenders featured on this list provide loans ranging from $500 to $50,000. How much they will lend you depends on your credit history, financial situation, and other factors. In general, you should expect a higher interest rate compared to someone who has a good or excellent credit score.
When you apply for a loan and provide all the required information, you may be pre-approved based on meeting the minimum criteria. After the lender has fully assessed your application, they can decide whether or not to lend you money.
To increase your chances of getting approved, you should have a source of income, provide your bank account details, have a valid Canadian address, and have an acceptable debt-to-income ratio.