5 Things To Consider When Applying for an Instant Loan in Canada

instant loan

In 2019, 73.2% of Canadians had either carried outstanding debt or used payday loans within 12 months of the survey. If this research tells us anything, it’s that many of us are dealing with an uncomfortable reality:

We’re always a bad month away from being caught in a difficult financial situation. And once those financial walls start closing in, everything, from securing loans to getting last-minute credit, becomes harder and harder to do.

If you need money right now, you can skip the waiting times and appointment dates required by traditional banks. How? By taking out an instant loan.

Like choosing a new pair of shoes or buying a house, however, you can’t just choose the first loan that falls into your lap. You’ll want to do your due diligence and take steps to ensure that you’ve found the best service possible. Read on to see our list of five factors to consider when taking out an instant loan in Canada.

1. The Borrowing Limit

When you apply for a mortgage, the bank will happily lend you a minimum of six figures. If you’re looking for a traditional personal loan, you can expect to receive a healthy five figures. For Canadians who have built up significant equity in their homes, refinancing is a golden opportunity to raise a hefty amount of cash.

With instant loans, however, you’ll struggle to find a lender that offers more than four figures. Why? Because the loans are specifically geared for emergency situations where you need some fast cash to keep you afloat.

In dollar values alone, getting your car fixed or replacing your microwave won’t cost as much as a full-scale roof replacement.

So here’s the bottom line:

If you need a last-minute cash injection, you’ll be hard-pressed to find anything better than an instant loan. But if you need a lot of money right away, it might not be the best lending option for your needs right now.

2. The Interest Rate

Generally speaking, there are two ways to secure lower interest on a loan. You can:

  • Have flawless credit
  • Use your car or house as collateral

In Canada, instant loans typically don’t involve credit checks or secured lending options. It’s the equivalent of taking out a small short-term loan from a friend. Even so, however, interest rates can often be quite high.

When you’re in a tough financial bind, words like “fast loan” and “instant approval” can quickly convince you to make an application. But even so, it’s important to think about how those loan repayments will affect your bottom line in the long run.

3. Your Debt-to-Income Ratio

Remember what we said before about how instant loans, like the ones we offer here at kingcash.ca, often don’t involve credit checks? That statement is true. But although lenders like us will lend money without running credit checks, that doesn’t mean that we don’t have any lending standards at all.

In 2022, Investment Executive observed that Canadian household debt-to-income ratios had ballooned to a high of 186.2%. To put this number into perspective, this means that for every dollar that Canadians earned, they owed $1.86.

When instant loan providers receive your application, they’ll be looking for non-credit signs that you can make your payments on time. We understand that sometimes people go through hard financial circumstances and we’re here to help. But you’ll still want to think very seriously about how your current debt situation may affect your options as a borrower.

4. The Monthly Payments

Have you ever purchased a product only to get sticker shock at the after-tax and after-shipping bill? If you’ve spent any amount of time shopping online, the answer to that question is, “More times than I can count!”.

In the area of fast loans, it’s far too easy to look at the total amount and get lulled into a false sense of security.

For this reason, it’s important to make sure that you understand how much you’ll be paying each month until the loan amount has been repaid. And in this regard, not all lenders are created equal.

Some, like us, will commit to offering clients affordable repayment options. However, some online lenders want to make as much money as possible with short-term loans.

This step might seem a bit nitpicky in an emergency, but you’ll be glad you made repayment amounts a priority when you look at your monthly bill.

5. Your Cashflow Situation

You might have read the title of this section and thought, “Wait a minute. Weren’t we just talking about this?”. But this part is going to talk about another related, but equally practical, aspect of taking out instant loans:

The impact that the loan might have on your day-to-day finances. 

Maybe your department has been talking about cutting hours. Perhaps you’re still recovering from a setback that saw you on extended medical leave up until a few months ago.

Either way, it takes time to stabilize your finances in these circumstances.

If any of this sounds familiar, however, you’ll want to pay special attention to the repayment terms that you’re offered. Here at Kingcash, we allow borrowers to pay back their loans in anywhere from 3 to 12 months of installments. For Canadians who need both fast cash and a bit more time to get their financial footing, the cashflow consideration is arguably the most important one.

Get an Instant Loan if You Need Fast Cash

When the bills are past due and you’ve got yet another financial emergency on your doorstep, an instant loan can make a world of difference.

You’ll receive a decision right away. The money will be in your bank account almost immediately. And you can apply for and repay your loan without affecting your credit.

As a company, we understand that finding the right instant loan provider is easier said than done. However, we pride ourselves on our fairness, transparency, and well-priced loans. Claim your money today!

Get a cash loan from the comfort of your home.

Easy-to-use money lending services for quick and instant $500 - $750 loans in Canada.

This might interest you