What do you think about payday loans in Canada? Is this a blessing or a curse? You would be surprised to know the fact that nearly 2 million Canadians use payday loans on an average basis to cover unexpected expenses they haven't accounted for. If you immediately run across this guaranteed approval payday loan offer in Canada, it will appear as a blessing for you to handle unnecessary financial situations.
Now, people living on government benefits also have the freedom to apply for payday loans. This means you now have the source to arrange some immediate funds to clear the pending dues without prolonging it for too long. In this blog, we will cover various points on government benefits related to different types of people who can apply for payday loans, the first things to understand, consequences of non-payment of loans, and related points. So let's start.
Understanding the costing of payday loans
The costs associated with payday loans are no different for Canadian citizens living their lives on government benefits. The rate of interest varies according to the lender and as per the law regulations of different states. But in general, there may be $10, $15, $20, or even $30 as interest charges for every $100 you buy from the lender.
Let's take a payday loan scenario. If you get a $300 loan approved, you may be charged $45 as an interest charge, so in total, you'll pay back as much as $345. But if you're unable to repay the loan on time, you'll be charged $45 again, so the total amount comes to about $390.
If you cannot even afford this amount, then you will have to look for some other source to repay the loan. Every borrower's situation is different and you need to understand your own methods of settling the loan amount. Therefore, the best advice is to borrow the amount that you can repay within the stipulated period, otherwise not.
Eligibility criteria of payday loans for people living on benefits
Compared to other general lenders, payday loan prerequisites for those on a profit are slightly different.
- You must be above 19 years of age.
- Your government benefits income must be at least $800 per month.
- You must be a citizen of Canada and a resident of Ontario, Alberta, British Columbia, Manitoba, Prince Edward Island, New Brunswick, or Nova Scotia.
Now you have a clear picture. Payday loans for people living in government benefits to take care of uncertain dues can be a real advantage. Take care of your financial dealings and repay the loan on time.
What If you cannot Payday the Loan?
Not all lenders will tell you about it. What if you fail to repay the loan on time? Not only do you lose your reputation as a person living on government benefits, but you also face dire consequences as per various state laws.
Some common results are mentioned below:
- The lender may charge you a higher fee.
- The financial institution may also charge a fee if you do not have sufficient funds in your account.
- The principal and loan fees will remain the same and will increase over time.
- The lender may approach your friends, relatives, and near ones to collect their money.
- The lender may make a deal with your credit card's collection agency to put additional pressure on you.
- The lender or collection agency can sue you for non-payment.
- The collection agency or lender can seize your property or assets.
- The lender can approach the court to recover the pending money from you.
If you're unsure about repayment at first, don't fall into the trap of payday loans. Always keep your options open to arrange for extra cash in case of emergency and trust this loan offer in the end.
Different categories of people living on government benefits in Canada
Broadly speaking, there are several categories under which Canadian citizens living on government benefits are either not able to earn on a monthly basis or can avail themselves as an additional source of income.
Unemployment Benefits: There are people who are unemployed and receive financial benefits from EL in Canada up to a minimum amount of $800. Such people can apply for a payday loan if such money is received for at least 3 months in a continuous period.
Disability benefits: In Canada, people with disabilities receive special funding because of their short-term or long-term disabilities. This income can be used as a source of profit to apply for a short-term cash loan.
Child Tax Benefit: If having children and availing of special tax benefits, you are eligible to apply for an instant cash loan. You must make a profit of at least $800 per month.
CPP Benefits: Take advantage of the small loan offer if you are a Canadian Government Pension Benefit and receive a monthly amount of at least $800.
AISH Benefits: Receive money generated from Payday Loans if you are already receiving AISH Benefits.
ODSP Benefits: Ontario residents, in particular, have the advantage of applying for a maximum amount of $1500 as a payday loan.
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