Instant Loan Approval? Is It Possible If You Have Bad Credit?

Instant Loan Approval? Is It Possible If You Have Bad Credit?

Written by Lisa Rennie
Fact-checked by Caitlin Wood
Last Updated October 17, 2022

If you’re struggling financially due to a financial emergency, you may be wondering if you can get a loan immediately to help you afford the cost. If you’re for a loan with instant approval, your options will be limited, especially if you have bad credit. 

Can You Get An Instant Loan Approval?

If a lender of any kind offers you a loan instantly or guarantees your approval for a loan, they are more than likely trying to scam you. The reason why instant approval isn’t feasible is that lenders need to perform a certain amount of due diligence. This means they need to verify your identity and determine the level of risk they’ll be taking on if they lend to you.  

The good news, on the other hand, is that quick approval is absolutely possible, especially for anyone looking for a small short-term loan. Several alternative online lenders offer same-day loans. You can apply online in a few minutes, then get approved shortly after application submission. The funds will then be sent to your account electronically a few minutes later.

Can You Get An Instant Loan Approval If You Have Bad Credit?

As mentioned, while instant loans are not available, you can get a same-day loan. Eligibility criteria for these types of loans are very lax. In many cases, you don’t need good credit or any credit at all. But for the most part, you’ll need an active bank account. Most same-day lenders will ask for bank verification, which helps the lender assess your finances before approving your loan application.  

Where Can You Get A Instant Loan?

If you need to borrow money right away, the best options are personal loans, payday loans, and car title loans. While you can’t get approved instantly, you can get pre-approved with these lenders. A pre-approval will give you an idea of how much you can get approved for before proceeding with an official loan application. 

Loan AmountInterest RateTermProvince Availability
Spring-FinancialUp to $15,00029.99% - 46.96%9 - 60 monthsBC, AB, SK, MB, ON, NB, NS, PEI, NLLearn More
Magical CreditUp to $20,00019.99% - 46.8%12 - 60 monthsBC, AB, ON, NB, NS, PEI, NLLearn More
Lend DirectUp to $15,000Started at 19.99%Open-endBC, AB, SK, ON, NS, PEI, NLLearn More
iCashUp to $1,500Varies by province*Max 62 daysBC, AB, MB, ON, NB, NS, PEILearn More
Money Mart$120 -  $1,500Varies by province*Max 62 daysBC, AB, SK, MB, ON, NSLearn More
Captain Cash$500 - $750Varies by province*90 to 120 daysBC, AB, ON, PEILearn More
Cash MoneyUp to $1,500Varies by province*Up to 62 daysBC, AB, ON Learn More
My Canada Payday$50 - $1,500Varies by province*14 daysBC, AB, SK, MB, ON, NSLearn More
Pay2Day logo$50 - $1,500Varies by province*Up to 31 daysBC, ON, NSLearn More
Speedy Cash$200 - $1,500Varies by province*Next paydayBC, AB, SK, NS, YT, NT, NULearn More
Cash4YouUp to $1,500Varies by province*Next paydayBC, ONLearn More
Loan ExpressUp to $1,500Varies by province*Max 62 daysBC, AB, SK, MN, ON, NB, NS, NL, YT, NT, NULearn More
*The maximum borrowing cost for a payday loan varies by province, learn more here.

Instant Loans: Pre-Approved vs. Approved

While you can’t get instant loan approval, you can get an instant loan pre-approval. With both pre-approval and approval, your lender will assess your financial health and creditworthiness. But there’s a difference between the two. Namely, pre-approvals are non-binding and not guaranteed. 

Loan Pre-Approval 

With a loan pre-approval, your lender will provide you with an estimate of how much you can borrow and at what interest rate, based on the information you provide about your credit and finances. Pre-approval may also involve a soft credit check — which will not affect your credit score — to review your finances without doing a deep dive. 

Alternative online lenders typically give pre-approvals relatively quickly, some are instant while others may provide it within a few minutes of applying. However, it’s important to understand that pre-approval does not guarantee loan approval.   

Loan Approval 

To get officially approved for a loan, your lender will do a little more digging to verify your income. They may ask for more detailed documentation, such as a letter of employment, pay stubs, tax receipts, and bank statements. The lender will also pull a copy of your credit report to verify your credit score and history. 

Generally, if the information you provided during the pre-approval checks out, you’ll be approved for the loan. 

Types Of Loans You Can Get Almost Instantly

There are several variations of instant-like loans that you can apply for to get your hands on cash right away:

Payday loans

These types of loans are made for smaller amounts up to $1,500 with very short repayment terms. More specifically, you’ll need to repay the full loan amount — plus interest — by the time you get your next paycheque, which is usually anywhere from 2 to 4 weeks. 

Payday loans are easy to get approved for without the need for good credit. But they’re also very expensive. Interest rates on payday loans are among the most expensive in the world of lending, with APRs sometimes reaching over 500%. 

Depending on the lender, approval times and funding can vary from a few hours to a couple of days. 

Cash advance loans

If you have a credit card, you can get a cash advance as a way to get cash instantly. Since you already have a card, there’s no need to apply for a loan. 

But in exchange for this convenience is the high cost of borrowing from your credit card. Interest rates for credit card cash advances are around 20% to 23% and start to accrue as soon as you withdraw the money.

Personal loans

Some lenders offer fast personal loans, which usually come with lower interest rates than the above-mentioned loan options. Your lender will provide you with a lump sum of money which must be repaid in regular installments according to a specific repayment schedule within a certain time frame.

You can usually get much higher loan amounts compared to payday loans and credit card cash advances, but the loan criteria may be a little more stringent. These loans are available from many online lenders, and funding can be as quick as 1 to 2 days following loan approval. 

Requirements To Get An Instant Loan

In general, to be eligible for a quick loan, you’ll need to meet the following requirements:

  • Be the age of majority in your province or territory
  • Be a Canadian citizen or permanent resident 
  • Have a valid Canadian address
  • Have an active bank account
  • Have proof of an income (i.e. employment letter or pay stubs) 

How To Get An Instant Loan? 

As we discussed above, fast approval for a loan depends greatly on both the lender and the borrower. As the borrower, there are many steps you can take to guarantee that your loan is approved as quickly as possible. 

Step 1. Fill Out the Application

If you don’t fill out the original loan application properly the first time, it will only delay your approval. The lender will more than likely need to get in contact with you, which could add days onto the process. Filling out the application completely and accurately the first time around is one of the best steps you can take to guarantee your quick approval.

Step 2. Provide All The Necessary Documents

For a lender to approve you, they are going to need you to answer a lot of questions and provide them with all the appropriate documents and paperwork. If you want to get approved right away, you’ll need to make sure you fulfill their needs quickly and properly. Answer your phone, check your emails regularly and produce the needed documentation as soon as possible. The quicker you work, the quicker your lender is able to approve you.

Step 3. Get Funded

Once you’ve filled out the application and provided all the necessary documentation, the lender will process your application and determine whether you’re creditworthy or not. Depending on the lender and when you applied, this can take a few hours to a couple of days. If approved, these lenders can provide funding via e-transfer in as little as 15 minutes. 

How Fast Can You Get A Loan?

With many alternative online lenders, you can get approved and funded for a loan the same day you apply. However, there are some things that may slow down the process, including the following:

  • Applying after regular business hours. If you apply on a weekend or late at night, you’ll need to wait until the lender opens up the next business day to have your loan application processed. Otherwise, you’ll need to apply with a lender that operates 24/7. 
  • Making significant changes to your personal or employment status. If you recently changed jobs, moved, or made any other changes to your personal or financial situation, this will require more work on the part of the lender for review. In this case, you may want to work with a 24/7 payday lender that operates around the clock.  
  • You’re a first-time borrower. If you’ve never applied for a loan with the lender, you’ll need to supply various documentation required to set up an account with the lender, such as a government-issued photo ID, recent pay stubs, bank statements, and a void cheque. 

Cost Of An Instant Payday Loan vs A Instant Personal Loan

Personal LoanPayday Loan
Loan Amount$1,500$1,500
Loan Term 12 months14 days
Interest Rate 26%$15 per $100 borrowed
Monthly Loan Payment$142.57$1,725
Total Interest$210.80$225
Total Cost$1,710.80$1,725

How To Increase And Speed Up Your Loan Approval? 

To help increase your chances of getting approved for a loan and to ensure the process goes as smoothly as possible, consider the following: 

Find A Responsible Guarantor – If you have very bad credit or finances in general, finding someone to become a guarantor for your loan can help reduce your risk as a borrower and increase your chances of approval. Otherwise known as a “guarantor loan”, this occurs when someone with good credit and healthy finances agree to co-sign your application and cover your loan payments, if and when you can no longer afford them.

Be Honest and Realistic About Your Financial Situation – Lying about your financial situation, your job, or anything at all could jeopardize your loan approval and draw out the process. Most lenders want to help you get the money you need, but they also need to know the truth about your finances.

Instant Loan Approval FAQs

What is the easiest loan to get in Canada?

The easiest type of loan to get approved for is a payday loan. These loan types accept bad credit and no credit, and you can get approved and funded the same business day. Other loans that are easy to get in Canada include car title loans and pawn shop loans. 

Do pre-approvals guarantee loan approval?

No, getting pre-approved does not guarantee final loan approval. The lender will need to do a more thorough assessment of your financial health and credit history, which goes beyond just the information you provide for pre-approval.  Plus, if anything about your financial or credit history changes after you’ve been pre-approved, you can be denied approval for a loan if the lender feels that your current situation is no longer strong enough.

Can I apply for a fast loan if I have bad credit?

When it comes to new online lenders, bad credit is no longer an issue as there are countless loan companies that do not perform credit checks. Instead, many lenders ask for proof of income, references, and bank account verification. This will obviously depend on the lender you’re looking to work with, but loan approval no longer relies so heavily on excellent credit.

Should I use a guarantor for my loan?

If you have bad credit, a guarantor can not only help you get approved but also help you secure a lower interest rate. Moreover, with a guarantor, their credit and finances are checked instead of yours. However, do note, if you, the primary borrower, start missing payments, the responsibility for those payments falls to your guarantor.  

Bottom Line

Whatever your financial needs are, a  personal loan can help you get back on track, and cover the costs of most types of emergencies. It can also prevent you from having to take on a payday loan and even help you improve your overall financial health.


Rating of 5/5 based on 2 votes.

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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