Learn how to get a short-term loan in Yukon.
Payday loans are the most expensive form of short-term loan on the market, often used to make ends meet between paycheques or to cover emergency expenses. These loans can be a quick and easy solution for short-lived financial difficulties, but they should be avoided where less expensive alternatives exist.
We’ve designed this guide to help you navigate the ins and outs of cash advance payday loans in Yukon, so that you have as much information as possible before you sign on the dotted line.
Can I get a payday loan in Yukon?
Yes. Short-term loans are legal in Yukon. Federal laws regulate the maximum amount of money that can be issued by lenders ($1,500) and the max length of the term (62 days).
Yukon doesn’t have any territorial legislation governing the use of payday loans, which means they haven’t capped their maximum interest rates. The interest rate in Yukon currently sits at the federal maximum, which is $60 per $100 borrowed.
Four quick facts about payday loans in Yukon
- Maximum loan amount: $1,500
- Minimum loan term: 1 – 2 weeks
- Maximum loan term: 62 days
- Maximum interest: $60 for every $100 that you borrow
What fees will I have to pay?
Yukon is governed by federal payday loans legislation, which allows lenders to charge up to $60 for every $100 borrowed. The table below shows the fees on payday loans, compared to the typical costs of some common alternatives.
|Loan Amount (over 2 weeks)||Payday loan fee||Credit card fee (23%)||Line of Credit (7% + $5 fee)|
Can I get a no credit check loan in Yukon?
It may be possible to get a no credit check in Yukon, but it’s not your best option. These types of loans are often more expensive and are typically offered by predatory lenders. Your best bet would be to find a lender willing to do a soft credit check, which won’t affect your credit rating. In most cases, these lenders won’t turn borrowers away for having a bad- or poor-credit rating.
What should I keep in mind before applying?
Payday loans are largely unregulated in Yukon, which makes them a particularly risky kind of debt. Lenders are fairly unrestricted in terms of the fees and interest rates they can charge on loans, and there are also few rules in place to prevent predatory lending practices like rollovers (which allow borrowers to use a future loan to pay off their current loan). Some payday lenders may choose to charge less for a loan, so make sure you shop around for the best rate before you accept the terms of your contract.
How can I tell if a lender in Yukon is legit?
Lenders in the Yukon have very few licensing requirements, which means they have very few legally-mandated obligations to protect customers. Even so, above-board lenders may choose to abide by laws that are commonly enforced across Canada. Look for the following signs where possible to make sure you’re working with a reputable company.
- The lender follows federal payday loans legislation. Stay away from lenders who charge more than $60 per $100 loan. Make sure to compare several lenders to find the best terms for your loan (and keep an eye out for hidden fees buried in the fine print!).
- They don’t allow rollovers or multiple loans. Yukon is one of the only places in Canada where “rolling over” your loan is still legal. That being said, try to avoid lenders that allow rollovers since it’s a predatory practice which has been outlawed in many other parts of the country.
- They provide same-language contracts. Any payday loan agreement you sign off on should be written in the language of your choice. Your contractual obligations – including charges, terms and conditions of the loan – should also be clearly spelled out.
- The lender doesn’t request access to your bank account. Avoid any lender that requests direct deposit or any other banking information that could put your financial assets at risk.
Watch out for online lenders
Predatory payday lenders tend to work out of provinces and territories that don’t have stringent laws and regulations in place to protect consumers. These lenders can work from within the province, but they are more prone to set up shop online. If you’re thinking about taking out an online payday loan in Yukon, make sure that you’re aware of the potential risks:
- Illegally high interest rates or fees. Lenders that charge rates above the $60 per $100 rate are breaking federal payday loan regulations surrounding allowable interest rates. Make sure to report their activities to Consumer Protection at (867) 667-5111.
- Identity theft. Online lenders have been known to sell personal and banking information from borrowers to third-parties, leading to identity theft and hacked bank accounts. Avoid handing over direct deposit information and be wary of lenders who want personal details like your Social Insurance Number.
Since Yukon doesn’t impose the same payday loan regulations as other parts of the country, there are more risks associated with borrowing short-term loans both online and in-person. Make sure to read the fine print on payday loan contracts and look for short-term loan alternatives wherever possible.
How to file a complaint against a lender
You can contact Consumer Protection at (867) 667-5111 to file a complaint. Since there are very few regulations governing payday lenders, it can be difficult to prosecute those who are operating illegally or unethically.That being said, there’s no harm in reporting malpractice, particularly if the payday lender is charging more than $60 per $100 on your loan.
Short-term loan alternatives in Yukon
Before you accept the conditions of any payday loan contract, it pays to explore other short-term alternatives at your disposal.
Yukon assistance programs
Yukon has a number of programs that can provide some much-needed relief for residents and newcomers who are struggling to make ends meet.
- Yukon Social Assistance provides financial assistance for low-income individuals and families who need help with covering the costs of basic necessities like food, shelter and heating.
- Child benefit provides a monthly cash benefit to help low‑ and modest‑income families with the cost of raising children under 18 years of age.
Local financial institutions
If you don’t qualify for social assistance benefits, you might like to try your local credit union or bank for short-term loans. Some of these institutions are working to counteract payday loan providers by offering low-interest, short-term loan programs to help customers with unforeseen emergency expenses at a fraction of the cost.
If you find yourself struggling to keep your head above water, then you might like to consider a credit counselling program, like those on offer by the Credit Counselling Society of Yukon. These not-for-profit programs can provide free consultations to help you to manage or consolidate your debt and balance your budget.
How can I apply for short-term loan?
If you’re interested in applying for a short-term loan in Yukon, you’ll need to meet the following eligibility criteria:
- Be at least 19 years old
- Prove 3 months of continuous employment
- Give proof of address (e.g., they can ask to see a utility bill)
- Have a chequing account
To complete your application successfully, prepare to submit some basic information:
- Personal details, such as your name, date of birth, Social Insurance Number and a valid form of ID
- Contact details, such as your residential address, email address and phone number
- Details about your employment and income
If you’re looking for a quick and easy solution to deal with a short-term financial problem, then a payday loan might be just the ticket. Make sure you’re in the position to pay off the loan (with fees as high as 60% tacked on) at the end of your term. If you don’t think that you can pay back your loan on time, look into other alternatives like borrowing through a line of credit from your local bank or taking out a cash advance from your credit card.