Cash Loans Canada

How Do Fast Cash Loans Work?

There are many products offered by lenders that come with different timelines and conditions. A fast cash loan is a solution that gets money into your bank account quicker than standard loan options. You’ll apply online, provide any documents requested and your request will be processed right away. As long as the lender thinks you can pay back the loan, you’ll be on your way with available cash.

While a fast cash loan will get you money right away, they do tend to come with higher interest rates than standard loans. A bank will typically offer better terms but have a much higher threshold for acceptance. When you don’t have assets for collateral or your credit history is in a bad place, you are deemed a higher risk person to lend money to. Fast cash loan lenders will increase their fees and rates just in case you are unable to pay it back in full.

It’s worth stating a fast cash loan is not the same as an ill-reputed payday loan. Fast cash loans offer a wider range of loan amounts. Payday loans tend to provide you cash instantly, but max out at 1,500$ with extremely high rates. A fast cash loan will be structured in a way to give you funds up to 10,000$ with an agreed upon series of equal installments.

As long as you meet the requirements for a fast cash loans you’ll receive the entire amount upfront. Depending on the agreement and amount, you’ll pay it anywhere between a few months up to years. The flexibility in a fast cash loan makes them a safer option.

Who Should Apply For a Fast Cash Loan?

Any Canadian above the age of majority in their province can apply for a fast cash loan. The application process will look at your financial history, credit score and all of your income sources. While there is a cost for fast cash loans, they will help when you encounter expenses that need to be dealt with right away. Whether it’s a chance to pay overdue bills, medical expenses or even something like a vacation, a fast cash loan will get you money now. However, if you can afford to wait, it may be worth looking into loan options with a longer approval process.

Fast cash loans tend to be useful in the following moments:

• You need a large sum of money now, to deal with some bill or expense and you are not going to be paid for at least 2 weeks.

You encounter an emergency where interest rates make an expense larger than what you can afford to pay down with your current budget.

How do Canadians Get Cash Loans?

Step 1: Apply

After you find a lender, you can head to their website and apply for a cash loan online. You’ll fill out a form and provide any details requested. In the event you cannot apply online, most lenders offer physical locations where you can apply in person.

Step 2: Wait for a Decision

Once you apply, the lender will take a look at your file and render a decision. Online applications tend to be processed quickly, and you may even find out the same day. If you applied in person, you’ll receive notice of the decision by phone instead.

Step 3: Documents

After the lender deems you to be an eligible candidate, you’ll need to supply any requested documents. You’ll receive your contract with all available terms and you’ll sign to finalize.

Step 4: Receive Funds

At this point you have been approved and everything is ready to go. The money will be deposited directly into your bank account and you’ll have access.

Step 5: Pay Back Loan

When you receive your money, you are also agreeing to pay back the cash loan at a regular interval, in equal amounts. Your repayment schedule considers any interest and other fees. By paying it down on time you’ll see a positive impact on your credit.

What Are The Advantages of Cash Loans?

It’s true that cash loans come with higher rates but there are some benefits worth taking a look at.

Fast Access to Cash

The main draw for this loan type is that they give you cash fast. They have a low barrier to entry making them accessible to more Canadians in need. There is often an emergency, or an opportunity, that puts you in a place where access to money now will make a difference in your life. Getting money within a day or two is the biggest reason borrowers head towards fast cash loans.

Lower Payments

Cash loans tend to offer flexible repayment options where the timeline can span a couple of years. This lets you manage smaller payments instead of being expected to pay the whole loan back in a couple of weeks.

Static Rates

Long term loans provided by financial institutions, covering majour expenses like mortgages, are attached to what’s called a variable rate. This means as the economic forces out there fluctuate, your rate will be updated to reflect those changes. Cash loans fall under the short-term category. Since you’ll be paying it back in a quick period of time, lenders are comfortable offering a flat rate that won’t change over the length of your agreement. This lets borrowers set a budget in a reliable way without risk.

Key Points Worth Knowing About Cash Loans

When you are looking into cash loans, here are the risky factors borrowers need to know:

1. Interest Rates: Lenders make their money on the fees accrued through interest on the loan. When you borrow an amount, you should expect that what you pay back will be a much larger amount compared to long termed loans.
2. Repeat Loans: Borrowers may find themselves in a position where after their loan repayments they do not have enough money left over to get by. They already know how easy it is to get a cash loan, so they take on extensions to their loan, increasing both the regular payment fees and the length of loan creating a cycle of unending debt.
3. Predatory Lenders: The cash loan industry has become hard to regulate allowing some bad actors to appear. They offer exploitive terms and rates creating debt cycles you are stuck in. Make sure to double check the reputation of any company you plan on borrowing from.

What Are the Best Practices for Cash Loans

Considering the risk we’ve covered with regards to cash loans, it’s worth taking a look at some best practices should you choose to borrow:

Choose the Right Amount

Determine how much money you actually need. Taking out a loan may feel like you just got a bonus from work, but you have to pay back every dollar. The higher your cash loan, the more you will pay in interest, costing you a lot more overall.

Read Everything

Make sure you read your contracts in full. While Canada does it’s best to protect its citizens from predatory practices, some lenders take advantage of borrowers. Understand what happens when you miss payments and how much you’ll pay overall.

Pay on Time

Make any payments on time, as per your agreement. This will have a positive impact on your credit and keep your finances on track. Be extra cautious to avoid having insufficient funds in your account, both the bank and your lender will levy a fee.

 

Cash Loan FAQs

 

Can Someone With Bad Credit Get an Instant Cash Loan?

Most people with bad credit can get a cash loan in Canada. Fast cash loan options are offered by companies that specialize in bad credit scenarios, using increased fees to protect themselves from risk. The caveat is that you need to have a source of income and show that you will be able to repay the loan with your current finances. The better your credit score is, the better rates you’ll be offered.

What is Required to Get a Cash Loan in Canada?

You’ll need to provide some documents in order to get a cash loan in Canada. You’ll need a piece of ID that proves you are a legal resident above the age of majority in your province. You’ll need recent records of employment, bank statements and proof of your current address.

The lender will then run a credit check and evaluate if they feel you are able to pay back your loan on time. It’s worth looking into consigners if you feel you may not be approved.

What Amounts Of Money Are Available With Fast Cash Loans?

Fast cash loans usually are offered within the $500 to $10,000 range. What you are eligible for is based on a few things. The amount of money you earn each year will be compared against the total amount of debt you owe. This ratio gives lenders an idea of how big a fee you can afford.

They will also consider the amount of money you are asking for. If you have a bad debt to income ratio and are asking for the largest possible amount, this will be considered high-risk. Usually lenders will only offer you an amount they believe you can manage to avoid creating cycles of ongoing debt.

Is A Cash Loan The Best Alternative to Payday Loans?

Payday loans look like the best option because you are almost guaranteed to get money now. However, unlike cash loans, high interest rates and strict repayment schedules mean you have no wiggle room at all. Missing a single payment, can end up with excessive fees and extensions to your loan.

Cash Loans still provide money quickly but offer easier repayment terms. The extended period of time makes the payments smaller and you’ll usually encounter better rates than dealing with payday loans. With installment loans you’ll get a larger amount in a more manageable way.

You can also use credit cards to deal with a crisis. The problem is that usually you need decent credit to have a good limit. However, if you have the space available on your card you can use it to withdraw cash. Be advised that interest rates on credit card cash advances will be higher than your regular rate and usually comes with an additional transaction fee.