6 Best Guaranteed Approval Loans For Poor Credit In Canada (2024)

Looking to borrow money? How’s your credit score? That factor alone can determine how easy it’ll be to secure a loan.

The average Canadian has a credit score of around 650, within the fair range, and can probably access decent loans with good interest rates. It also means there’s still a large portion of the population struggling to borrow money. 

If you’re one of those people, applying for a guaranteed approval or a bad credit loan might be your only option. Here’s our top picks for the best guaranteed approval loans for poor credit in Canada.

What Is a Guaranteed Approval Loan?

If you have bad credit and need to borrow money, your prospects could be daunting. Because of your low credit score, lenders won’t flock to lend you money. Instead, you might try for a guaranteed approval loan.

These loans aren’t necessarily what you think. It doesn’t mean you’re automatically approved just because you applied. Ultimately, most legitimate lenders won’t advertise guaranteed approval loans.

Instead, they’ll encourage you to submit an application even if you have a less than favourable credit score.

Top 6 Bad Credit Loan Companies In Canada

1.  Loans Canada

Eligibility requirements:

  • Age of majority in your province.
  • Canadian citizen
  • Active chequing account
  • Valid Canadian address
  • Social insurance number
  • A valid government-issued ID.

Loans Canada has a large network of lenders willing to help those with weak credit. They offer bad credit loans or debt consolidation programs to consolidate multiple existing balances into one. Usually, these loans are at a lower interest rate, helping to save money as you pay off the balance.

Applying is easy enough. You start by selecting your service – building credit, getting out of debt, or growing a business. From there, you can apply online and receive personalized offers based on your initial selection.

You can borrow up to $50,000, with loan terms varying depending on the loan type.

2.  LoanConnect

Eligibility requirements:

  • Age of majority in your province
  • A Canadian citizen or permanent resident.

Similar to Loans Canada, LoanConnect lets you search through its database of lenders even if you have less than stellar credit. You can come away with up to $50,000 with a loan period of six to sixty months.

The LoanConnect website states that you can apply and get preapproved within five minutes. Same-day funds are also available.

The multitude of lenders on the site means lots of variety to choose from. There’s a selection of personal loans, debt consolidation, and cash loans. If you struggle with subpar credit, LoanConnect offers bad credit loans. The best part is that you’ll find out if you’re preapproved within minutes.

The downside to any bad credit loan is that you’ll probably have to pay a higher interest rate simply because those with poor credit have a higher chance of default.

3.  Mogo Loan


Eligibility requirements:

  • Citizen or resident in Canada.
  • Age of majority in your province.
  • You need a net annual income of at least $13,000.
  • A valid ID and bank statement.
  • You also cannot currently be involved in bankruptcy or insolvency.

Mogo lets you choose a personal loan from $500 to $50,000. There are flexible terms on all their loans with no penalties if you wish to pay them off early.

Something that sets Mogo apart is they offer a 100-day trial period. If you aren’t satisfied with your experience, you can pay back the principal amount and have any interest and fees refunded in their entirety.

With a MogoAccount, you can monitor your credit score for 90 days, all for free.

4.  easyfinancial

easyfinancial logo

Eligibility requirements:

  • You must be at least 18 and employed.
  • A citizen of Canada or permanent resident.
  • Must have a minimum net monthly income of $1,200.

With easyfinancial, you can apply for a personal loan of up to $20,000 with no credit history needed. While the initial interest rates are higher for these types of loans, their website states that one in three customers graduate to prime rate over time.

In addition, you can borrow up to $75,000 if you use your home equity as collateral. At your convenience, apply over the phone or online, and if approved, get your money within a day.

5.  Spring Financial

Eligibility requirements:

  • Age of majority in your province.
  • You need a valid ID.
  • Some source of income.

You can borrow $500 to $15,000 and receive the funds on the same day via e-Transfer. Spring Financial has biweekly or monthly repayment plans, and all timely repayments get reported to the credit bureaus to help improve your credit score.

The loans are open, and you can pay them back with no penalties or extra fees. At your convenience, you can apply online or over the phone. If approved, you can get access to the money instantly or within a day.

Several factors affect the interest rate, including your credit score, current debt load, and incoming income.

6.  LendDirect

Eligibility requirements:

  • Canadian citizen or permanent resident.
  • Employed for at least three months.
  • Proof of your address.
  • Minimum monthly income of $1,500.
  • An active bank account.

LendDirect offers borrowers loans up to $15,000. You can apply online, over the phone, or in person at one of their branches located throughout Southern Ontario. If you’re approved, you can receive your money in as little as 15 minutes through Interac e-Transfer.

They also offer a loan protection service that covers your payments if you can’t make them. Don’t worry about repaying the loan early – you won’t get hit with any early payment penalties.

Consider the Interest Rates

Consider the Interest Rates

Most bad credit loans, even the ones with the best reviews, offer skyrocketing interest rates. The reason is simple enough. If you have bad credit, you’re a risk to the lender.

There’s a greater chance you’ll default on your loan payments than someone with higher credit.

To offset this risk, lenders will charge you more interest. However, by keeping up with your regular payments, some of the above online lenders will decrease your interest rate over time.

The bottom line is that if you plan on getting guaranteed or bad credit loans, you should expect to pay higher interest rates than if borrowing from a bank or credit union.

How To Boost Your Credit

Guaranteed Approval Loans For Poor Credit In Canada

One of the significant factors determining if you qualify for loans and what your interest rate will be is your credit score. If you have poor credit, banks and credit unions might deny your application or approve you only with an exorbitant interest rate.

Working to increase your credit score will give you better options and cost you less money. Here’s how to do it.

1.   Check Your Credit Score

Before improving it, find out what your score is. Canadians can access their credit report for free each year through TransUnion or Equifax. After you receive your report, review it for any discrepancies and make sure to dispute anything that isn’t correct.

2.   Make On-Time Payments

Payment history accounts for a big part of your credit score, so it’s crucial to ensure your payments are on time. In addition, if you can’t pay off the full amount, at least pay the minimum amount due.

3.   Be Patient

Making one on-time payment isn’t going to skyrocket your credit score. Instead, you’ll need to consistently pay down existing debt to see any improvement. If you continue keeping up with payments, you should notice a bump in your credit score within a few months.

For other tips on boosting your score, check out this in-depth article I wrote about the topic.

Final Thoughts

Guaranteed Approval Loans For Poor Credit In Canada

Researching and securing a loan is stressful enough, but if you don’t have great credit, the process can be even harder. If you can’t get a loan from a bank or credit union, there are still options available.

Most guaranteed or bad credit loans will cost more in interest, so research all your options before signing on the dotted line.

If you’re looking to understand more about credit and ways to improve it, check out these factors that impact your score.

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Author Bio - Christopher Liew is a CFA Charterholder with 11 years of finance experience and the creator of Wealthawesome.com. Read about how he quit his 6-figure salary career to travel the world here.

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