Related: Best bad credit loans in Canada
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Bad credit loans in Toronto
Compare lenders for bad credit or no credit check loans in Toronto.
Having bad credit can limit what type of loan you qualify for in Toronto, but there are still plenty of options to choose from. The two main types of bad credit loans in Toronto are installment loans and payday loans. Learn more about the features of each loan type and compare lenders to find the best option for your unique personal situation.
Option 1: Compare bad credit installment loans in Toronto
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What are installment loans?
Installment loans are a type of personal loan option for Torontonians with bad credit. You can borrow large amounts over a long term (usually up to 5 years). They come with lower interest rates than payday loans, but you’ll typically need to undergo a credit check.
- Loan amounts: $500 to $10,000 for bad credit
- Loan terms: 3 - 60 months, sometimes shorter
- Interest rates: 18% to 47% for bad credit
Eligibility requirements for bad credit installment loans in Toronto
You’ll usually have to meet the following criteria to qualify for bad credit installment loans:
- Be the age of majority. You have to be at least 18 years old.
- Steady source of employment income. Although there are some lenders that accept non-employment income, many require you to have a full-time job.
- Meet the minimum credit score. Bad credit loan lenders in Toronto typically require a minimum credit score of 500 to 550.
- Valid bank account. You’ll need to provide a void cheque or fill out a pre-authorized debit form to link your bank account.
Benefits and drawbacks of installment loans for bad credit in Toronto
Before deciding if an installment loan for bad credit is the right choice for you in Toronto, consider these benefits and potential drawbacks.
Benefits
- Easy application. You don’t have to visit a physical branch in Toronto, but can instead apply online in a few minutes by filling out a simple web-based application.
- Fast. Get pre-approval within a few minutes and formal approval usually within 24 hours. Get your money within 24 to 48 hours.
- Longer term. You can pay your loan back over 3 - 60 months.
- Manageable rates. Starting rates for installment loans are around 18%, which is much lower than what you’ll pay with payday loans.
Drawbacks
- Interest rates are still high for bad credit. You’ll pay rates starting at 18%, which is higher than what you’ll pay for a good credit loan in Toronto and almost on par with credit card interest rates.
- Stricter eligibility criteria than payday loans. You may need to meet a higher credit score or income requirements than you would with payday loans in Toronto.
- Repayment takes longer than with payday loans. You’ll make payments on your loan for a much longer period than you would have to with a payday loan.
- Late or missed payments can damage your credit. The longer you repay, the higher the chance you’ll miss a payment, leading to high fees and damage to your credit score.
How to apply online for Toronto bad credit loans
Getting a personal loan is within reach for Torontonians even with bad credit. Here are the steps to apply:
- Check your credit. Get a free copy of your credit report from Equifax or TransUnion. This will help you figure out if you meet the eligibility criteria for various loans. You can also get your credit score from companies that offer credit score monitoring.
- Compare lenders. Apply for personal loan pre-approval with several lenders who operate in Toronto to compare the real bad credit loan rates you might qualify for (not just the advertised rates).
- Pick the best lender. Your lender will do a hard credit check and verify your income and identity.
- Review and sign your final loan offer. Once your lender verifies your identity and income, you’ll receive your final loan offer. Read it over carefully before signing.
- Get your funds and start repaying your loan. Your funds should be available within one business day. From there, you’ll repay your loan weekly, bi-weekly or monthly.
Bad credit installment loans if you prefer to visit a Toronto branch
| Lender | Loan amount | Loan term | APR | Location in Toronto |
|---|---|---|---|---|
| Fairstone | $500 – $25,000 | 6 - 60 months | 26.99%-39.99% | 4+ locations Check on Google |
| easyfinancial | $$500 – $100,000 | 9 - 120 months | 9.99% - 46.96% | 18+ locations Check on Google |
| Money Mart | $500 – $15,000 | 6 - 60 months | 29.90% - 46.90% | 16+ locations Check on Google |
Option 2: Compare payday loans for bad credit in Toronto
⚠️ Warning: Be cautious with payday loans
High-cost payday loans are unsustainable for borrowing over a continued period of time and are expensive as a means of longer-term borrowing. View payday costs and regulations by province here. If you're experiencing financial hardship call Credit Counselling Canada for free financial counselling (Monday-Friday 8:00am-5:00pm at +1 866-398-5999). You may also want to consider payday loan alternatives.1 - 5 of 5
What are payday loans?
Payday loans are another bad credit loan option in Toronto, and sometimes come with no credit check. They come with a maximum term of 62 days and are the most expensive loan type in Ontario.
- Loan amounts: $100 to $1,500
- Loan terms: Repay by your next payday, up to 62 days
- Interest rate: $15 for every $100 borrowed
- Toronto repayment regulations: If you take out 3 payday loans in Toronto within 63 days, your lender must let you pay your third loan and (loans after that) in installments.
Eligibility requirements of bad credit payday loans in Toronto
You’ll usually have to meet the following criteria to qualify for bad credit payday loans in Toronto:
- Be the age of majority. You have to be at least 18 years old.
- Steady source of income. In most cases, you’ll need to connect your bank account via instant bank verification, so the lender can verify your income and identity.
- Valid bank account. You’ll typically be asked to provide a void cheque or fill out a pre-authorized debit form to link your bank account.
Benefits and drawbacks of bad credit payday loans in Toronto
Benefits
- Easy application. Most payday loan lenders who operate in Toronto allow you to apply online in under five minutes.
- Fast. Get approved almost instantly, with funds often provided through Interac e-Transfer within a couple of minutes. The fastest payday loans are completed within one hour of applying. Learn more about instant loans.
- Bad credit doesn’t matter. Your credit score truly doesn’t matter for most payday loans.
- Easy eligibility criteria. As long as you have a steady source of income, including non-employment income in some cases, you can qualify.
Drawbacks
- Very expensive. You’ll pay a maximum fee of $15 for every $100 borrowed, which can add up to an APR of 300% or more (an extremely high cost compared to installment loans).
- Small amounts. It’s only possible to borrow up to $1,500, so it may not be suitable for those who need a larger bad credit loan in Toronto.
- Short terms. If you miss paying your loan by your next payday, you’ll pay an NSF fee and a late payment fee.
- Don’t help to build credit. Your credit score will not improve when you make repayments on a payday loan.
- Missed payments damage credit score. In addition to high fees, your credit score will go down if you fail to make on-time repayments.
How to apply online for a Toronto bad credit payday loan
You can apply for payday loans in Toronto by following the steps below:
- Look for a reputable lender. Payday lenders in Toronto charge the same rate, so you’ll want to look at other features such as the company’s reputation, speed, business practices and how much they’re willing to lend to you.
- Fill out an application. Pick the best lender for your needs and fill out an application. This should take only a few minutes.
- Connect your bank via instant bank verification. Your lender will get a read-only copy of your bank statements through a secure portal.
- Review and sign your final loan offer. Once your lender verifies your identity and income, you’ll receive your final loan offer. Read it over carefully before signing.
- Get your funds and start repaying your loan. Your funds should be available almost immediately. You’ll need to repay your loan in two weeks to around two months.
Bad credit payday loans if you prefer to visit a Toronto branch
| Lender | Loan amount | Loan term | APR | Location in Toronto |
|---|---|---|---|---|
| Money Mart | $120 – $1,500 | 1 - 62 days | Varies by province | 16+ locations Check on Google |
| Cash Money | $100 – $1,500 | 5 - 40 days | Varies by province | 18+ locations Check on Google |
| Cash 4 You | $120 – $1,500 | Up to 62 days | Varies by Province | 6+ locations Check on Google |
| Pay2Day | $300 – $1,500 | Up to 62 days | Varies by province | 1 location (622 Yonge St) Check on Google |
Option 3: Compare car title loans in Toronto
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What are car title loans in Toronto?
Car title loans are a secured bad credit loan option for Torontonians. The loan uses your vehicle as collateral, which means you may get access to lower rates compared to other types of unsecured personal loans for bad credit in Toronto.
- Loan amounts: $1,000 to $50,000
- Loan terms: 3 – 60 months
- Interest rates: 9% to 49%
Eligibility requirements of car title loans for bad credit in Toronto
You’ll usually have to meet the following criteria to qualify for car title loans in Toronto:
- Be the age of majority. You have to be at least 18 years old.
- Steady source of employment income. Car title loan lenders will want to see recent pay stubs, bank statements, receipts from benefits or other proof that you can afford to repay the car title loan in Toronto.
- Car title in your name. You’ll likely need to provide your vehicle’s registration, insurance and bill of sale proving that you’re the registered vehicle owner.
- A vehicle in good condition. The car should be in good or excellent condition with a wholesale value over a few thousand dollars and with no liens, major damage or accidents on its record.
- Vehicle inspection. Car title loan lenders who operate in Toronto may ask you to get a vehicle inspection certificate to ensure your vehicle is in a suitable condition.
Benefits and drawbacks of bad credit car title loans in Toronto
To decide if getting a car title loan in Toronto is the best bad credit loan option for you, consider these benefits and drawbacks:
Benefits
- Bad credit is accepted. Since your vehicle’s title is acting as collateral on the loan, you can qualify with a bad credit score. Some lenders even provide car title loans in Toronto with no credit check.
- Easy to qualify. Vehicle title loans are generally quite easy to qualify for. You’ll just need to fill out an online application, and provide proof of vehicle ownership and condition, along with proof that there are no outstanding liens on the car.
- Receive funds quickly. If you apply for a bad credit car title loan at a physical location in Toronto, you can generally receive approved funds as soon as you sign the loan’s contract. Apply with an online car title loan lender to have your funds transferred into your bank account by the next business day.
Drawbacks
- Could possibly lose your car. If you default on the loan, the lender has the right to repossess your car and sell it to repay the loan.
- High interest. The APRs on car title loans in Toronto can be as high as 60%.
- Few online car title loan lenders. While online car title loan providers can be more convenient to apply for than in-person loans, it can be hard to find trustworthy online lenders from such a small selection.
How to apply for a car title loan in Toronto
You can easily apply for car title loans online from lenders who operate in Toronto.
- Compare lenders. Look at features like APRs, loan amounts and the eligibility requirements to find the right fit for you. You’ll also want to decide between applying for car title loans online or at an in-person lender based in Toronto.
- Fill out the application. Once you’ve decided on a lender, start the application. You’ll typically need to provide information about your car (like it’s make, model and condition) and personal information (like your contact, employment and income details).
- Provide documentation. You may need to provide additional documents to verify your application, including a copy of your driver’s licence, proof of income, proof of residency (like a recent utility bill or lease) and proof of insurance.
- Upload photos of your car (if applying online). Your lender will likely ask you to upload pictures of your car from various angles. You’ll also need to upload a copy of your car title document or mail in the original.
- Get your car inspected. You’ll need to get your car inspected by the lender itself or from an approved local inspector.
- Sign the loan document. Review the loan details including term length, APR and amount. Look out for hidden fees by reading the fine print before signing.
- Receive your funds. Online car title loan lenders can e-transfer funds to your bank account on the next business day. In-person lenders may pay you on the spot or send funds once you’ve brought your vehicle in for appraisal.
Can I get Toronto loans with no credit check?
Yes, it is possible to get loans in Toronto with no credit check. Many payday lenders offer no credit check loans in Toronto as long as you’re a Canadian resident who is the age of majority in your province (which is 18 years old in Ontario).
On the other hand, the majority of bad credit installment loan lenders in Toronto will conduct a credit check, and those that don’t usually expect you to have a high income or regular full-time employment.
Just remember that you’ll pay very high interest rates for any loans you get in Toronto with no credit check.
Dive deeper: Types of no credit check loans in Canada
Can I get loans with guaranteed approval in Toronto?
Even if you find bad credit loans in Toronto advertising “guaranteed approval”, they likely won’t be legitimate. Guaranteed approval loans are one of the most common sources of loan fraud. The lenders offering these loans may promise to give you money so they can collect fraudulent upfront fees.
Tips to pick the best bad credit loan in Toronto
Compare the following features to get the best bad credit loans in Toronto:
- Annual percentage rate (APR). APR is the interest rate you’ll pay plus fees. Aim to get pre-approved with a few installment loan lenders to find the best APR for your credit score.
- Fees. Read the fine print to make sure you don’t get saddled with additional fees. These include NSF fees, late payment fees, origination fees, prepayment penalties or fees for loan insurance.
- Repayment flexibility. Look for a lender that will let you pay the loan back on your own schedule. With installment loans, you may also want to see if you can prepay your loan with no penalty.
- Lender reputation. Checking a lender’s online presence and customer reviews can give you a good indication of the quality of service you can expect to encounter with your loan. If you notice a pattern of complaints, that could be a red flag. Learn more about personal loan scams and legit lenders.
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