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British Columbia Residents: iCash offers payday loans in British Columbia (license number: 67639)

Ontario Residents: Loan amounts and repayment terms are subject to qualification requirements. The maximum allowable cost of borrowing under the payday loan agreement is $14 for every $100 advanced. On a $500 loan of 14 days, the total cost of borrowing is $70, with a total payback amount of $570 and an APR of 365%. On a loan of 62 days, the APR is 82.42%.

Manitoba Residents: To learn more about your rights as a payday loan borrower, contact the Consumer Protection Office at 1-204-945-3800 or 1-800-782-0067 or at www.manitoba.ca/cca/cpo

Nova Scotia Residents: Payday loans are High Cost Loans. The maximum allowable cost of borrowing under the payday loan agreement is 14$ per every 100$ received, which means on a 100$ loan for 14 days, the total cost of borrowing is 14$, with total payback amount of 114$ and an APR of 365.00%.

PEI Residents: Loan amounts and repayment terms are subject to qualification requirements. The maximum allowable cost of borrowing under the payday loan agreement is $14 for every $100 advanced. On a $300 loan of 14 days, the total cost of borrowing is $42, with a total payback amount of $342 and an APR of 365.00%. On a loan of 62 days, the APR is 82.42%.

The Cashback Program and Refer a Friend Program are not available in Manitoba, British Columbia and New Brunswick.

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Best Bad Credit Loans In Canada 2025

Lisa
Author:
Lisa
Lisa Rennie
Senior Contributor at Loans Canada
Lisa has worked as a personal finance writer for over a decade, creating unique content to help educate Canadian consumers. Expertise:
  • Personal finance
  • Real estate
  • Mortgage financing
  • Investing
Caitlin
Reviewed By:
Caitlin
Caitlin Wood, BA
Editor-in-Chief at Loans Canada
Caitlin Wood has more than a decade of experience helping Canadian consumers learn how to take control of their finances. Expertise:
  • Personal finance
  • Consumer borrowing
  • Credit improvement
  • Debt management
📅
Updated On: July 9, 2025
iCash

Bad credit doesn’t always mean you’re bad with money. Maybe you missed a few payments due to a temporary job loss, an unexpected emergency, an illness or simple forgetfulness. Even if your financial situation has improved since then, that old credit score can still follow you around like a shadow.

Unfortunately, traditional banks often don’t look beyond the number. If your credit isn’t perfect, they’re quick to say no, no matter how responsible you are today. That’s where bad credit loans can come in handy. If you are looking for a loan with bad credit, we have a list of reliable lenders that can help you get the money you need.


Key Points

  • You can get a loan with bad credit from various sources, including private personal loan lenders, payday loan lenders, cash advance services, and more.
  • Credit scores between 300 – 559 are usually considered “bad”.
  • While you can get a loan with bad credit, it’s important to remember that these loans often come at a higher cost.

Can You Get A Loan With Bad Credit? 

The answer is: of course you can! Having bad credit doesn’t mean you’re out of options. There are many lenders that specialize in working with people who have less-than-perfect credit. These lenders generally put more emphasis on your income, debt-to-income ratio, employment stability and overall financial health when determining creditworthiness. 

That said, most lenders that offer loans to those with bad credit, generally charge higher rates.

Do You Have Bad Credit?
If you have a credit score between 300 – 559, it’s generally considered to be “bad”. If you don’t know what your credit score is, you can check for free using Loans Canada Compare Hub

Borrow Up To $50,000

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100% FREE. NO OBLIGATION.

Best Types Of Loans You Can Get With Bad Credit In Canada

There are many types of loans you can get with bad credit. With these options, you can get the funds you need quickly.

Types Of Bad Credit Loans In Canada

Loan AmountLoan TermInterest Rate
Bad Credit Personal Loan$500 - $10,00012 - 60 months19% - 35%Learn More
Payday Loan$100 - $10002 weeks$14 for every $100 borrowedLearn More
Vehicle Title Loan$500 - $50,00012 - 60 months9.9% - 35%Learn More
Credit Builder Loan$1,250 - $10,0006 -12 months2% - 19.99%Learn More

Personal Loans

Personal loans provide lump sum amounts that are repaid over a set term via installments, which include principal and interest. They’re often unsecured, which means no collateral is required, and can be used for anything from home repairs to debt consolidation.

Payday Loans

Payday loans are short-term, high-cost loans that are typically due for full repayment on your next payday. These loans are often used for emergency cash needs and are easy to get approved for without a credit check. However, they come with steep fees and interest rates, making them among the more expensive loan options out there.

Cash Advance Services

Small cash advance services offer quick, short-term access to money, usually up to $500, to help cover unexpected expenses and avoid bank overdraft fees. Popular cash advance apps in Canada include Bree, Nyble, KOHO, and MoneyUp, which provide interest-free advances, no credit checks, and fast funding: 

  • Bree: Bree offers up to $500 in instant cash advances with zero interest, fees, or credit checks.
  • Nyble: Nyble provides a $250 interest-free line of credit with no credit check. You can also use Nyble to build your credit score with every on-time payment.
  • KOHO Cover: You can access up to $250 interest-free with KOHO Cover with no credit checks. A low monthly subscription fee is required.
  • MoneyUp: With MoneyUp, you’ll get access to up to $1,000 in instant credit, without interest or a credit check.

Vehicle Title Loans

Vehicle title loans are short-term loans that involve using your car as collateral to borrow money. These loans are fast and easily accessible, even if you have bad credit. 

However, they typically come with higher interest rates. Plus, the lender holds the vehicle title during the loan term, which means they can repossess your car if you default on the loan.

Credit Builder Loans

Credit builder loans are small installment loans designed to help you build or improve your credit score. Rather than receiving the money upfront, you make monthly payments into an account, which are reported to the credit bureaus. Once the loan term ends, you get access to the money while enjoying a healthier credit score and positive payment history.


What Do You Need To Qualify For A Loan With Bad Credit?

The requirements for a loan when you have bad credit will vary depending on the lender and loan type. However, in general, you can expect the lender to assess the following factors: 

  • Income: Every lender will require proof of income to ensure you have enough income to pay back the loan.
  • Employment: Most lenders want you to be employed for 3-6 months with your current employer. This shows your lender that you have a stable source of income and have the ability to repay the loan over a period of time. That said, payday lenders may be more lenient and accept income from non-employment sources such as pension, disability, or government benefits.
  • Resident: You’ll need to be at least a resident of the province where the lender operates in.
  • Debt-to-Income Ratio: Lenders may also assess how much of your income is currently being used to pay your other debt obligations. Ideally, lenders like to see a ratio below 32%.

Learn more: Personal Loan Eligibility Requirements For Bad Credit Lenders


Where Can You Get The Best Loan With Bad Credit?

Loading...
Loans Canada
Loans Canada
Amount
Up to $50,000
Rate
Prime to 35%
Term
3-60 months
Spring Financial - Personal Loan
Spring Financial - Personal Loan
Amount
$300 – $35,000
Rate
9.99% – 34.95%
Term
6 – 60 months
Mogo - Line of Credit
Mogo - Line of Credit
Amount
Up to $5,000
Rate
34.37%
Term
easyfinancial - Personal Loan (Unsecured)
easyfinancial - Personal Loan (Unsecured)
Amount
$500 – $20,000
Rate
29.99% – 34.99%
Term
9 – 84 months
Cash Money - Line of Credit
Cash Money - Line of Credit
Amount
Up to $10,000
Rate
34.99%
Term
6 - 60
Cashco - Personal Loan - Flex Loan
Cashco - Personal Loan - Flex Loan
Amount
Up to $7,000
Rate
35%
Term
6 – 60
iCash - Payday Loan
iCash - Payday Loan
Amount
Up to $1,500
Rate
$14 per $100
Term
Up to 62 days
Nyble - Line Of Credit
Nyble - Line Of Credit
Amount
$30 – $250
Rate
0%
Term
Bree - Cash Advance
Bree - Cash Advance
Amount
Up to $500
Rate
0%
Term
Up to 65 days
SkyCap Financial - Personal Loan
SkyCap Financial - Personal Loan
Amount
$500 – $100,000
Rate
8.99% – 35%
Term
9 – 60
Magical Credit - Magical Installment Loans
Magical Credit - Magical Installment Loans
Amount
$1,500 – $20,000
Rate
19.99% – 35%
Term
12 – 60
Loan Me Now - Personal Loan
Loan Me Now - Personal Loan
Amount
$500 – $1000
Rate
Up to 32%
Term
3
AimFinance - Personal Loan
AimFinance - Personal Loan
Amount
$100 – $1,000
Rate
29% – 35%
Term
9 – 24


How Can You Apply For Bad Credit Loans Online? 

1. Review Your Finances And Your Credit Score

Before applying for any type of loan, whether you have bad credit or not, you should review your financial situation and even check your credit score. This will help you better understand what type of offer you expect to receive. 

2. Compare Lenders

Depending on the loan you want and your financial situation, it’s likely that certain lenders will be a better fit for you. This is why it’s so important to compare lenders. Compare interest rates, loan amounts, fees, and the total cost of the loan once you’ve paid it back, and check out consumer reviews.

3. Gather Documents

While application requirements can vary from lender to lender, make sure you have the following documents and information ready to help facilitate the application process.

  • Government-issued I.D.
  • 3 months’ worth of bank statements
  • Proof of address
  • Proof of income/ employment

4. Apply For Bad Credit Loans Online!

Once you’ve decided on which lender you want to apply with, it’s time to submit an application. The majority of bad credit lenders will have an online application system which means you won’t have to leave your house to apply.

5. Wait For Your Bad Credit Loan Approval

Most alternative lenders can now get back to you within 24 hours. Others will get back to applications within a few days. Make sure you check your email or answer your phone in case the lender requires more information or has questions for you.

6. Get Funded

Once approved, you can expect to receive your loan within 24 hours. Most lenders can send funds via Interac e-Transfer or direct deposit.

Can You Use A Bad Credit Loan For Anything?
A bad credit loan can be used to cover your expenses during unemployment or other financial emergencies. It can also be used for any other purchase or expense you may have. Additionally, you can use your bad credit loan to help you gradually build good credit by making full payments on time.

Best Ways To Secure A Loan With Bad Credit

The truth is that if you show that you can pay your debts on time, lenders will reward you with a better interest rate and repayment plan. Plus, they might approve you for a bigger bad credit loan amount. The less risky your lender considers you, the better the result. 

Add Security

When you offer an asset (vehicle, real estate, etc.) as collateral for a loan, your lender will temporarily own it until your loan is fully paid. So, if you default on too many payments, they will have the right to seize your asset and sell it to cover your debt. 

This added security for the lender can not only help you secure a loan with bad credit but may help you qualify for lower interest rates.

Add A Co-Signer

By co-signing your application, your guarantor is agreeing to cover your payment(s) if you can’t afford to. This added security can lead to better approval odds, rates and loan conditions.

Note: If your cosigner end up responsible for your payments but also cannot afford them, they could be subject to the same penalties and credit damage as you would.

Lower Your Debt-To-Income Ratio

Lowering your debt-to-income (DTI) ratio shows lenders that you can effectively and responsibly manage your finances, even without perfect credit.

A low DTI ratio improves your chances of loan approval by showing that you earn enough to handle new debt. It can even help you qualify for lower interest rates or more flexible terms. 

Tip: If your borrowing needs are not urgent, consider improving your credit prior to applying for a loan in order to increase your chances of approval and qualifying for a lower interest rate. You can help build your credit by:
– Check your credit report for errors and have them corrected.
– Pay all your utility, cell phone, and internet bills on time.
– Use a secured credit card to make responsible payments.
– Increase your credit limit and don’t carry too much revolving debt.
– Avoid minimum or partial payments.

How Much Do Bad Credit Loans Cost?

Before you apply for a bad credit loan, it’s extremely important to think about your budget and the associated costs of the loan.  

  • Interest – What your lender charges to borrow from them. The lower your interest rate is, the cheaper your loan will be. However, bad credit lenders often charge higher rates because they are taking on riskier clients.
  • Fees – All too often, borrowers don’t think about the fees their lender could charge, whether they are for each payment or a one-time cost. These fees can include loan origination, preparation of documents, and other administrative services.
  • Penalties – If you pay your loan installments on time, then you shouldn’t have to worry about penalties. Unfortunately, every late, incomplete, or missed payment will lead to a penalty fee.
  • Term – The length of your loan term, as well as the size and frequency of your payments, are also important. While a longer term means more affordable payments, a shorter term and larger payments mean the total cost of your loan will be lower.
APRMonthly PaymentTotal InterestTotal Cost
10%$87.92$54.99$1,054.99
20%$92.63$111.61$1,111.61
30%$97.49$169.85$1,169.85
*$1,000 personal loan with a 1-year term.

Pros And Cons Of Bad Credit Loans

Bad credit loans can be beneficial when you’re in need, but there are also many drawbacks associated with them that you must consider. Check out these pros and cons of bad credit loans before you give away any information:

Pros Of Bad Credit Loans

  • Easier Approval Requirements – Many loan companies that accept bad credit have lower requirements for approval. Most simply require you have the financial capability to repay the loan.
  • Fast And Convenient – Many bad credit loans are offered by online loan companies, meaning you can complete your entire application online. Moreover, applications are usually short and simple and you can expect to receive your funds within a couple of hours or days.
  • No Credit Check – Certain bad credit loan companies don’t require credit checks.
  • Can Build Credit – If your bad credit loan company reports payments to the credit bureau, it can help you build a positive payment history which may help you gradually improve your credit.

Cons Of Bad Credit Loans

  • Higher Loan Cost – Generally, loan companies that accept bad credit charge higher interest rates, fees, and penalties.
  • Qualify For Less – Loan companies for bad credit usually offer smaller loan amounts and more restrictive payment terms.
  • More Chance Of Scamming – Private lending companies are harder to regulate, leading to a higher possibility of scamming, fraud, and illegal rates.

Are You Struggling With Bad Credit? Here’s How You Can Help Improve It

If bad credit is hampering your efforts to access credit products, it may be time to take some steps to improve your score. Here are some ways to give your score a boost:

Make Payments On Time

Payment history makes up 35% of your credit score, making it the most important factor in your score’s calculation. To ensure you make timely bill payments, set up automatic payments or calendar reminders for your bills, or even pay the minimum amount on time to avoid late fees (though making full payments is still highly recommended).

Use Credit Building Products

Services like KOHO and Spring Financial offer credit building products designed to help you establish or rebuild credit, especially if you’re just starting off with no credit history or need to repair a poor credit score. These tools can even be used to save money, and require no additional debt to use.

Use Secured Credit Cards

Unlike a traditional unsecured credit card, a secured credit card requires an upfront deposit, which becomes your credit limit. You can use the card like a regular credit card for purchases, both online and in person. Payments are reported to credit bureaus, helping build your score, as long as you make timely payments and keep your balances low.

Have Your Rent Payments Reported

Rent payments aren’t typically reported to the credit bureaus. But rent is often your biggest monthly expense, making it a missed opportunity to build credit. Fortunately, services like Chexy and City Lending Centers (CLC) help report your rent payments to boost your credit score over time.

Learn more: Rent Report: Can You Report Your Rent Payments To The Credit Bureau?

Keep Your Credit Utilization Low

Maintaining your credit utilization ratio — which refers to the available credit you’re using — under 30% can help boost your credit score. To help reduce this ratio, pay off balances early, make more than one payment per month, or request a credit limit increase.

Why Do I Have Bad Credit?
Unfortunately, while late or missed payments play a major factor in lowering your credit score, there are a few other events that can lead to bad credit, such as:
– Uncorrected errors on your credit report (wrong name, address, etc.)
– Having too much revolving debt on your credit card or line of credit.
– Applying for credit too often (every time a lender checks your credit, a hard inquiry will appear on your report and decrease your score slightly)

What Happens When You Have Good Credit?  

If your score is in the “good” range of 660 – 900, it’s generally because you’re a responsible borrower. As such, lenders will assume you’re more likely to pay your debts on time, so it will be easier for you to get approved for a large amount of credit, a lower interest rate, and an appealing payment plan.


Bottom Line About Bad Credit Loans

While bad credit can make it difficult to get approved for a regular loan from a bank, you can still get a loan with bad credit. There are many online bad credit lenders who base their approval on your overall financial health.

If you want an easy way to get matched with a bad credit lender, submit a request with Loans Canada today. We can find you a lender that accepts bad credit and meets your needs.


Bad Credit Loan FAQs

Can I get a bad credit loan from a bank?

Most banks don’t offer bad credit loans because their lending policies are more restrictive, often preventing them from approving people who don’t have good credit or a decent income. So, you’ll most likely have to apply with an alternative lender or a subprime lender that caters to borrowers with bad credit. 

Can I still get a bad credit loan if I have a consumer proposal on my credit report?

Yes, there are many subprime lenders that will offer you a bad credit loan, even if you’ve gone through a consumer proposal, bankruptcy, or other debt relief program. However, they may want you to be discharged before they’ll approve you. Additionally, you must watch out for the higher costs associated with these types of loans.

Should I get a secured or unsecured bad credit loan? 

Remember, a secured loan is when you offer an asset as collateral. The more valuable your asset is, the better your approval chances, interest rate, and loan conditions will be. That said, there is definitely more risk associated with a secured bad credit loan because defaulting can result in the loss of your collateral.   If you want to avoid that danger or don’t have any collateral, an unsecured bad credit loan may be a safer choice. However, unsecured loans are typically smaller, have shorter terms and have higher overall costs.

Do bad credit loans get reported to the credit bureaus?

Some bad credit lenders don’t report to Equifax or TransUnion, this is particularly true for payday lenders. However, if you default on your bad credit loan, the lender may sell your debt to a collection agency which may end up on your credit report. If you’re looking to improve your credit with a bad credit loan, be sure to ask your lender if they report payments to the credit bureau.  

How do credit scores work? 

Bad credit can be difficult to understand, especially if you’ve just started using credit products. Here’s an example of how credit works. When you use your first credit card, your provider will begin reporting your payment activity to Equifax and/or TransUnion, Canada’s credit bureaus. Each bureau will create a slightly different credit report in your name. This document contains all your credit-related actions over the past few years. You will also have a 3-digit credit score ranging from 300 to 900, which summarizes how healthy your credit is. Keep in mind that credit users have more than one credit score. If you apply for another credit product, such as a loan, many lenders will check your credit to know how risky you would be as a potential client.

Lisa Rennie avatar on Loans Canada
Lisa Rennie

Lisa has been working as a personal finance writer for more than a decade, creating unique content that helps to educate Canadian consumers in the realms of real estate, mortgages, investing and financial health. For years, she held her real estate license in Toronto, Ontario before giving it up to pursue writing within this realm and related niches. Lisa is very serious about smart money management and helping others do the same.

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