• You may also have options outside of getting a loan. The Canada Grant Watch website lets you search for grants by category and eligibility requirements. It also provides information on how grants work and how to increase your chance of getting approved. Additionally, people who are under 65 years old and unable to work due to a disability may be able to get benefits through the Canadian Pension Plan (CPP) Disability Benefits program. The exact amount you could receive varies based on your income level and other factors.

Representative example: Jenna buys a wheelchair

Jenna, a resident of Ontario, is recovering from an accident and can’t work for 6 months. To cut down on expenses and pay her bills during this time, she moves in with her mother and applies for government Employment Insurance (EI). Jenna needs a comfortable, lightweight wheelchair to help her get around and finds someone who’s willing to sell her a gently used, high-quality model for $500.

Jenna’s private health insurance coverage is limited and won’t cover the cost, and her annual income puts her over the threshold of qualifying for provincially-funded medical equipment. She’ll have to cover the cost out-of-pocket, but there’s just one problem: The seller wants to close the deal now, and Jenna won’t have the money until her next EI payment arrives in 2 weeks.

Installment loan vs payday loan: Which is better?

Jenna does some online research and finds both a reputable payday lender and installment loan provider. She receives quotes from each based on her credit score, income and other factors. These are the costs:

• 33% interest rate
• $0 application fee (waived by lender)

In this case, it’s cheaper for Jenna to get an installment loan to pay for her wheelchair. The fees and interest rate are lower, resulting in an total savings of $. Payday loans are typically much more expensive than most other forms of debt, so this result isn’t surprising.

The final verdict

Besides being cheaper, the installment loan will also allow Jenna to spread out repayment over the next six months, whereas the payday loan will have to be fully repaid in two weeks. Because she’s on a fixed income, Jenna decides the installment loan is the safer and more convenient option.

She applies online, submits the required documentation and is approved instantly, thanks to her solid credit score. The lender sends the funds to Jenna via email money transfer. Within minutes, she receives the money and contacts the seller to finalize the sale. (Note that not all personal loan providers offer instant application decisions.)

*The information in this example bad credit installment loans Idaho, including rates, fees and terms, is provided as a representative transaction. The actual cost of the product may vary depending on the retailer, the product specs and other factors.

Bottom line

Look for lenders that accept government assistance as a form of income. Carefully compare rates and fees, and take the time to understand the terms and conditions of any loan you’re interested in getting.

If approved, you should receive the loan in your bank account within minutes or up to a couple of business days, depending on how the funds are sent. If you apply in person at a payday loan branch, you may be able to leave with cash immediately upon approval.

With 40% of Americans unable to come up with $400 for an emergency expense, the need for emergency cash loans should not be underestimated. Cash emergencies can occur without warning and can be quite challenging, especially if you don’t have an emergency fund.