An extra $5,000 can come in handy during a financial emergency. No matter what you need the money for, a $5000 loan can help cover it when your bank account is a little short.
If that happens, there are loan options to consider. That said, your credit and financial situation will determine where you can get approved for a $5,000 loan, as well as the cost.
Let’s go over a few of these options and what you need to do to apply and get approved.
How To Get A $5,000 Loan In Canada
To apply for a personal loan, follow these steps:
Step 1. Comparison Shop
Before applying with any one lender, be sure to compare lenders. More specifically, compare the loan amounts, terms, and rates to find the best loan type and lender for you. If researching multiple lenders is too confusing, consider using a loan comparison platform like Loans Canada.
Step 2. Know The Minimum Requirements
Before applying for a loan, you should find out what the requirements are for loan approval. You’ll want to make sure you meet these criteria before applying so you can maximize your chances of loan approval. Moreover, you can avoid any unnecessary credit checks which may negatively impact your credit scores.
Step 3. Get Pre-Approved
Getting a pre-approval will let you know how much you qualify for and what the terms will likely be. Pre-approvals also don’t require credit checks, so you can find out if you qualify before completely applying.
Step 4. Complete And Submit A Loan Application
Once you’ve decided on a lender, complete the loan application online. Be sure to upload all the relevant documents as required. You will be asked for information such as proof of income and employment, bank statements, and photo ID. Before submitting your application make sure that it’s 100% complete and free of inaccuracies.
Step 5. Wait For Funding
If you’ve been approved, you can expect the funds to be deposited into your account within 24 hours.
Get An Affordable Loan Here
Cost Of A $5,000 Personal Loan
When calculating the cost of a $5000 personal loan, you’ll need to consider multiple factors. Each one can impact the total cost of your loan. This includes your interest rate, loan term and fees.
- Interest rate. The rate you’re charged on your loan will have a direct effect on how much you’ll pay over the loan term. The lower the rate the better. More specifically, the “APR” or annual percentage rate refers to the rate and fees to finance the personal loan and is expressed as an annual cost.
- Loan Term. The term length will determine how much you’ll pay with each installment payment, as well as how much interest you’ll pay overall. Shorter terms mean bigger installment payments, but you’ll pay less towards interest. Longer terms, on the other hand, mean smaller payments, but you’ll be paying more in interest over the loan term.
- Fees. There are other costs besides interest that you should look at, such as the following:
- NSF fee – If there are not enough funds in your account on payment day, you’ll be charged a fee for insufficient funds, which usually range between $30 and $50.
- Penalty Fees – Depending on the lender, some will charge a penalty for early loan payments. Similarly, if you make a payment late, you will be charged a late payment fee.
- Loan Insurance – If you have bad credit, your lender might try to sell you loan insurance in the event that you default on your $5,000 loan due to job loss, illness or death. This is optional and unnecessary, so you may want to avoid any lenders that pressure you to buy it.
The following chart outlines a handful of scenarios to help you compare loan costs on a $5,000 personal loan with different rates and term lengths:
|Scenario 1||Scenario 2||Scenario 3|
|Total Cost For 3-year term||$5,394.76||$5,808.09||$6,689.45|
|Total Cost for 5-year Term||$5,661.37||$6,374.11||$7,948.17|
Types Of $5,000 Loans In Canada
You’ve got a few options when it comes to accessing a $5,000 loan:
$5000 No Credit Check Loans
Conventional personal loans require a credit check on applicants to verify their creditworthiness and ability to get approved for a $5000 loan. But if you’ve got bad credit, your chances to qualify for a loan will be lower.
In this situation, a no credit check loan may be an option. With this loan type, the lender will not perform a credit check. Instead, the lender will look at other factors, such as your income, assets, and proof of employment to approve the $5,000 loan.
$5,000 Instant Approval Loans
If you need cash urgently, an instant approval personal loan may be an option. With this type of loan, you’ll be pre-approved right after you apply and the funds will be transferred into your account within a few hours or the next business day. These loans are only available from alternative lenders, and interest rates tend to be much higher compared to more traditional personal loans from conventional lenders.
$5,000 No Bank Verification Loans
When you apply for a $5,000 personal loan, most lenders will require certain bank documents and an active bank account as part of their approval process. This can make it difficult for Canadians without bank accounts to access a loan. Thankfully, there are alternative lenders who offer $5,000 loans with no bank verification. Instead, these no bank verification lenders will require solid proof of income and employment stability.
Do note, that these lenders generally charge much higher interest rates and fees due to the additional risk they take.
$5,0000 No Refusal Loans
If you’re afraid you’ll be rejected due to bad credit, you may want to look into a no refusal loan. A no refusal loan requires no credit checks, so you’ll qualify so long as you meet the lender’s other requirements such as income level, debt level and employment stability. You can find no refusal loans through payday lenders and alternative personal loan lenders. It’s important to note, that these lenders are expensive as they usually charge higher interest rates and fees.
$5,000 Secured Loans
If you need help qualifying for a $5000 loan or you want to qualify for better rates and terms, you should consider getting a secured personal loan. These loans are secured with an asset of value, such as a house or vehicle. Since the loan has collateral, there’s less risk for the lender, and in turn, these loans typically come with lower interest rates and better terms. Moreover, you’ll have a higher chance of qualifying for the $5,000 loan.
Who Offers $5,000 Personal Loans In Canada?
You can apply for a $5,000 personal loan with a few different types of lenders:
Can You Get A $5,000 Bank Loan?
Your main financial institution is the most obvious option when it comes to taking out a personal loan. If you’re already a client with a specific bank, you may be able to get a $5,000 loan from them.
Just keep in mind that loans from banks typically require very good credit in order to get approved, and their application process usually takes longer. But if you have good credit, you’ll likely get a competitive interest rate, making your loan more affordable.
Can You Get A $5,000 Loan From A Credit Union?
Local credit unions are another source for personal loans, and they often offer competitive interest rates as well. That said, you’ll need to be a member of a credit union before you can apply for a $5,000 personal loan.
If you’re not already a member, applying for membership could take a while. So if you’re looking for a quick loan, this may not be the best option.
Can You Get A $5,000 Loan From An Alternative Lender?
There’s a growing number of alternative lenders available online if you need a $5,000 personal loan. Online lenders process applications and fund accounts much faster than banks and credit unions. You won’t need to provide as much information, and credit checks are not always required.
Applications can be completed in just a few minutes, and approvals are provided shortly after. Plus, you can access your funds within hours after loan approval.
If you’re in need of quick cash and don’t have the credentials to get approved with a traditional lender, then an alternative online lender may be your best option. Just keep in mind that you’ll probably be paying much higher rates.
Where Can You Get A $5,000 Loan In Canada?
|Loan Amount||Interest Rate||Term||Province Availability|
|Up to $50,000||Prime to 46.96%||3 - 60 months||Across Canada||Learn More|
|$1,000 - $15,000||29.9% - 46.9%||12 - 60 months||BC, AB, SK, MB, ON, QC, NB, NS, PEI, NL||Learn More|
|$300 - $35,000||9.9% - 47.72%||24 - 60 months||BC, AB, ON, NB, NS, PEI, NL||Learn More|
|$500 - $35,000||9.99% - 46.99%||6 - 60 months||BC, AB, SK, MB, ON, NB, NS, PEI, NL||Learn More|
|$500 -$25,000||26.99% - 39.99%†||6 - 60 months||BC, AB, SK, MB, ON, QC, NB, NS, PEI, NL||Learn More|
|$500 - $20,000 (unsecured)||Starting at 29.99%||9 - 84 months||BC, AB, SK, MB, ON, QC, NB, NS, PEI, NL||Learn More|
|$5,000 - $50,000||5.75% - 22.99%||Up to 84 months||BC, AB, MB, ON, NB, PEI, NL||Learn More|
|$5,000 - $35,000||Starting at 9.9%||6 - 60 months||BC, AB, SK, MB, ON, QC, NB, NS, PEI, NL||Learn More|
|Up to $15,000||Starting at 19.99%||Open-end||BC, AB, SK, ON, NS, PEI, NL||Learn More|
|Up to $5,000||19.9% - 45.9%||6 - 36 months||BC, AB, ON, NL||Learn More|
|$500 - $12,500||19.99% - 34.99%||12 to 60 months||BC, AB, SK, MB, ON, NB, NS, PEI, NL||Learn More|
|Up to $10,000||12.99% - 39.99%||9 - 60 months||BC, AB, SK, MB, ON, NB, PEI, NL||Learn More|
Can You Take Out Multiple Payday Loans Instead Of A Single $5,000 Personal Loan?
You cannot take out more than one payday loan at the same time in most provinces in Canada, whether with the same lender or a different one. You’ll need to pay off the full loan balance of your payday loan before you can apply for another.
Provincial laws prevent multiple payday loans from being taken out at the same time to protect Canadians against predatory lenders.
An extra $5,000 can come in really handy when you’re tight on cash. If you find yourself in this predicament, there are a few loan options available to you, and the one you choose will depend on your financial and credit profile.