No credit check loans are available in Canada, however, they often come at a cost.
When a lender approves your loan application regardless of your credit rating, you can expect to pay high interest rates or may be required to provide collateral.
Payday loans generally fall into the no credit check loan category. There are also financial institutions that offer these loans on terms that are more favourable than what payday lenders offer.
Read on to learn about how to apply for a loan without having your credit file pulled or checked.
What is a No Credit Check Loan?
A no credit check loan in Canada is one in which the lender does not check your credit score or report before they approve your loan application.
While credit scores and reports are a standard metric for assessing creditworthiness, individuals with bad credit or no credit have other options.
Instead of pulling your credit file, lenders who offer loans with no credit check in Canada look at your employment status, income as shown by your bank statements, whether you have a guarantor, or can provide collateral.
They ask the borrower to provide documentation showing that they can pay back the loan and not default on payments.
Best No Credit Check Loans
|Lender||Amount||Interest Rate||Loan Term|
|LendingMate (ON & BC only)||$2,000 – $10,000||43%||12 – 60 months|
|Loans Canada||Up to $50,000||1.99% – 46.96%||4 – 60 months|
|LoanConnect||Up to $50,000||5.75% – 46.96%||6 – 60 months|
Also known as alternative lenders, no credit check loan companies charge a higher interest rate than traditional banks.
The ones we have listed below offer quick online applications and you can receive funds within a couple of days.
LendingMate offers guarantor loans in Ontario and British Columbia.
You can borrow up to $10,000 even if you have a bad credit score, however, you must have someone guarantee that you will pay back the loan.
To start, complete the online application form and provide the necessary details.
LendingMate will contact your guarantor and have them complete their portion of the application process.
Your loan is typically paid out within 24 hours of the guarantor being accepted.
You don’t need to be employed to qualify for a guarantor loan.
- Interest rate: 43%
- Loan amount: $2,000 – $10,000
- Term length: 12 – 60 months
- Minimum credit score: N/A
Loans Canada works with various lenders who cater to individuals with bad credit scores.
You can use the platform to search for loans you want to use in consolidating your debt, and, for credit building and debt relief purposes. It also works with lenders who offer no credit check loans online.
To see what’s available, apply online and they will connect you with a third-party lender as applicable.
- Interest rate: 1.99% to 46.96%
- Loan amount: Up to $50,000
- Term length: 4 – 60 months
- Minimum credit score: N/A
This platform is available to borrowers across Canada.
This loan search engine offers a one-stop shop for finding cash, debt consolidation, bad credit, installment, and online loans.
LoanConnect works with a variety of lenders including those offering no credit check loans. Some of them also accept applications from borrowers with previous bankruptcies or consumer proposals.
To start, complete the online application. If approved, funds are paid out in as little as 12 hours.
- Interest Rate: 9.9% to 46.96%
- Loan Amount: Up to $50,000
- Term Length: 6 – 60 months
- Minimum credit score: N/A
LoanConnect no credit check loans are available throughout Canada including Alberta, Ontario, British Columbia, Manitoba, and Saskatchewan.
Learn more about the platform in this LoanConnect review.
Refresh Financial offers a Credit Builder Loan which is different from a traditional personal loan. If you are looking to build or rebuild your credit score, a cash builder loan can help.
You don’t get any cash upfront. Instead, you make payments into your loan account and these payments are reported to the credit bureaus as transactions.
The funds you have deposited can be accessed for use when you want, and when you close the account, you get the balance.
- Interest rate: 19.99%
- Loan amount: $1,250 – $25,000
- Term length: 36 – 60 months
- Minimum credit score: N/A
Loan about credit builder loan in my detailed Refresh Financial review.
Other lenders offering short term no credit check loans in Canada:
- Captain Cash
- Northstar Brokers
- Money Mart
- SkyCap Financial
Types of No Credit Check Loans
The no credit check loans offered by online lenders vary in so many ways – interest rate, income eligibility, and maximum loan amounts.
Below are some of the more popular types:
1. Guarantor Loans
This loan type involves a third party (your guarantor) who co-signs the loan contract and promises to make payments if you default on the loan.
A person acting as a guarantor is required to have a good credit history and a stable source of income.
It is easier to qualify for a guarantor loan even if you have no credit history.
2. Secured Personal Loan
This loan is secured against your assets such that if you are unable to repay the loan, these assets can be seized by the lender.
Assets that may qualify as collateral for a loan include your vehicle, property, investments, or cash.
If you have an excellent credit score, you may qualify for lower unsecured personal loan rates.
3. Payday Loans
The most common no-credit-check loans are from payday lenders. Payday loans are very expensive with rates as high as 600% APR and loan terms spanning only a few weeks (average of 14 days).
The maximum amount you can borrow is around $1,500 and if you are unable to make payments on time, you could find yourself with a hefty debt burden.
What To Look For in a No Credit Check Loan
When considering a bad credit loan, look at the following features and ensure they suit your needs:
- Eligibility requirements: Find out what the income, credit score, location, guarantor, and debt-to-income ratio requirements are.
- Interest rates: Read the fine print to know what the loan will cost you in interest and origination fees. Ask about the Annual Percentage Rate (APR). You may be surprised at how much that payday loan is actually costing you. A $15 fee per $100 borrowed in a two-week period is equivalent to a 391% APR!
- No-fee prepayments: Many lenders allow you to pay off your loan early without penalty. That said, you should always confirm that your no credit check loan offers this privilege.
Benefits of a No Credit Check Loan
- Approval for loans without checking your credit.
- Fast online application process with funds becoming available in 1-2 days.
- Good for emergencies if you have no other options.
Downsides of a No Credit Check Loan
- They have high interest rates, especially payday loans.
- You may require a guarantor to qualify.
- Exposes you to predatory lenders and you could end up with a scam online loans service.
- It may not improve your credit score.
- Can result in a vicious cycle of debt if you are unable to pay it off quickly.
- Your assets (collateral) may be seized if you miss installment payments.
Related: Why You Should Avoid Payday Loans.
Are No Credit Check Loans Worth It?
A no credit check loan can be helpful if you need cash fast and have no cheaper options available to you.
Before approaching an alternative lender offering no credit check loans, check with your regular bank or credit union. They may be able to give you a loan with better rates and terms.
If this approach does not work, speak to friends and family to see whether they can help or co-sign a loan with you.
If you have a credit card, you can get a cash advance and try to pay it back as soon as possible.
If your financial situation is extremely bad, contact a credit counsellor for advice.
Can I borrow money without a credit check in Canada?
Alternative lenders and payday loan companies offer no credit check loans to Canadians. These financial institutions look at your income and bank statements to confirm you have the cash flow to repay the loan. In some cases, they may also require a guarantor.
Can I get a loan with a bad credit score in Canada?
You can apply for a bad credit loan through an alternative lender if your credit score is in the 500-600 range. Examples of companies offering secured and unsecured loans for bad credit include LoanConnect and Mogo.