Top 3 Loans for Bad Credit with Monthly Payments


There are times we find ourselves in a tight spot and need a little extra money.

cash loan

Unfortunately, too often, it’s easy to turn to a credit card. However, credit cards can easily carry an interest rate of 17% APR to more than 25% APR. If you make small minimum payments, it’s hard to make real progress and you can never be sure when, exactly, you’ll be able to pay off the debt.

On the other hand, a personal loan can be a better choice — even with a bad credit history. With installment loans, you know exactly how much you’ll repay and when you’ll be done.

What is an installment loan?

A credit card is an example of a revolving loan. You make payments and the balance goes down. However, when you pay off the credit card depends on how often you make payments and whether you pay more than the minimum requirement.

Installment loans, on the other hand, figure your fees and interest up front. They divide it by how long you’ll have the loan, and come up with a monthly payment. If you know that it will take you more than a few months to pay off your debt, an installment loan can often be a better choice than a credit card. This is true even if the installment loan has a higher interest rate.

Best Installment Loans for Bad Credit

Compare multiple lenders to see which online loans are best for you. Look for interest rate, monthly payment, and other terms to help you decide what is most likely to help you get out of debt.

No matter where you apply, though, realize that there will be a credit check. What you’re offered will depend on your credit score, income, and how long the term is. When you have a higher credit score, you’re more likely to get a lower interest rate. And, of course, if you can pay off your loan faster, some lenders will also offer a lower rate.

Here are some of the best lenders for those with bad credit.


CashUSA logo
Crediful’s rating
  • Loan Amount: $500 – $10,000
  • APR: 5.99% to 35.99%
  • Term: 3 to 72 months

With CashUSA, you use a network to get funds directly into your bank account. It doesn’t matter what type of credit you have, it’s possible for you to find a loan.

In most cases, you receive a decision in minutes, and you can use the loan for any purpose. Plus, you’ll find that you can get funds deposited directly into your bank account by the next business day.

Read our full review of CashUSA


Crediful’s rating
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  • Loan Amount: Up to $2,500
  • APR: Varies, depending on state, lender, and credit score
  • Term: Varies, depending on type of loan and state

MoneyMutual is an online marketplace of lenders that can connect you with various options. Almost any type of credit is acceptable. However, these are short-term personal loans, and the interest rates and loan terms and conditions vary.

Some online installment loans offered through MoneyMutual are similar to payday loans. In states where it’s allowed, a payday loan could lead to very higher interest rates of more than 200%. Carefully consider the loan offer before you accept it.

However, if you need money within 24 hours, and you just need a relatively small amount, MoneyMutual can help you find a match.

Read our full review of MoneyMutual

Crediful’s rating
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  • Loan Amount: $500 to $10,000
  • APR: 5.99% to 35.99%
  • Term: 3 to 60 months

With Bad Credit Loans, you can get connected with a lender quickly and easily. You can even get your money as soon as the following business day. This is one of the oldest places to find bad credit installment loans online, as it has been operating since 1998.

No matter your situation, you’re likely to be able to find a personal loan with this website. You can use the funds for any purpose, and make installment payments that you can afford for up to five years.

Read our full review of Bad Credit Loans

How do installment loans work?

Installment loans are typically used to finance large purchases, such as a car or home, or to consolidate debt.

Here’s how installment loans work:

  1. The borrower applies for the loan by completing an application and providing personal and financial information to the lender.
  2. The lender reviews the borrower’s application and makes a decision about whether to approve the loan.
  3. If the loan is approved, the lender will provide the borrower with a loan agreement that outlines the terms of the loan, including the interest rate, loan amount, repayment period, and any fees associated with the loan.
  4. The borrower reviews the loan agreement and decides whether to accept the loan. If the borrower accepts the loan, they will typically be required to sign a promissory note and provide collateral, if required.
  5. The borrower receives the loan funds and begins making monthly payments to the lender according to the terms of the loan agreement. These payments may include both principal and interest.
  6. The borrower continues to make payments until the loan is fully repaid.

It’s essential to carefully review the terms and conditions of any installment loan you are considering before accepting it. Make sure you understand the interest rate, loan amount, repayment period, and any fees or restrictions that may apply. It’s also a good idea to shop around and compare offers from multiple lenders to find the best deal.

How to Choose an Installment Loan for Bad Credit

If you have bad credit and are considering taking out an installment loan, here are some things to consider:

  • Shop around: Look for a lender that offers installment loans for bad credit and compare the terms and conditions of different lenders.
  • Consider the interest rate: Interest rates on loans for people with bad credit are generally higher than for those with good credit. Make sure you understand the interest rate you will be charged and how it will affect your monthly payments.
  • Check the fees: Some lenders charge origination fees, late fees, or other fees in addition to the interest on the loan. Make sure you understand all the fees associated with the loan and how they will affect the overall cost of the loan.
  • Look at the repayment terms: Repayment terms vary among lenders, so make sure you understand how long you have to pay back the loan and what your monthly payments will be.
  • Consider your financial situation: Make sure you can afford the monthly payments on the loan. Don’t borrow more than you can realistically pay back.
  • Read the fine print: Be sure to carefully read and understand the terms and conditions of the loan before signing any agreements. Make sure you understand any fees, penalties, or other conditions associated with the loan.

By considering these factors, you can choose an installment loan that meets your needs and that you can afford to pay back.

Understand the Real Cost of Lower Monthly Payments

Getting a manageable monthly payment is an important part of getting a personal loan. Installment loans are no good if the payments are so high that you can’t afford them long term. If you start missing payments, you end up in an even worse position, so carefully walk that line between affordability and term length.

Make sure you understand the connection between a lower payment and how much you pay overall. One of the reasons credit cards are so tempting is due to the low minimum payment. You think it’s affordable, but you can pay for several years because of how the payment is.

With personal installment loans, you know that you’ll be done in a set amount of time. However, the difference between a three-year loan and a five-year loan can be huge.

Installment Loan Payments

Let’s consider an installment loan of $5,000 with a 20% APR.

  • If you choose a three-year term, you’ll pay $186 each month and your total interest will be $1,689.45
  • With a five-year term, the monthly payment is $132 with interest totaling $2,948.17

As you can see, you might have a lower payment, but you’ll end up paying much more in interest. In most cases, it’s a good idea to get a loan term that’s as short as possible, with you paying the highest monthly payment you can afford.

Even if you only pay the minimum payments, installment loans can still be a better option than credit cards.

  • Credit card debt of $5,000 at 17% APR, with a $100 payment each month results in $3,759 in interest and more than seven years to pay off.

As you can see, sometimes an installment loan, even with a higher rate, can be the better choice.

When is an installment loan a good idea?

An installment loan can be a good idea in certain situations, such as when you need to borrow a large amount of money and you want to spread the payments out over a longer period of time. Installment loans can also be a suitable option if you have a stable income and can afford the monthly payments.

Some common reasons to consider taking out an installment loan include:

  • Major purchases: Making a major purchase, such as a car or home improvement project, can be exciting, but it can also be expensive. An installment loan can be helpful if you don’t have the money available in your budget to make the purchase outright.
  • Debt consolidation: To consolidate high-interest debt into a single loan with a lower interest rate. An installment loan can be used to combine multiple unsecured debts, such as high-interest loans and credit cards with revolving credit, into one fixed monthly payment. This is known as a debt consolidation loan.
  • Emergencies: Unexpected expenses can arise at any time and can be difficult to handle, especially if you don’t have an emergency fund. An installment loan can help cover unexpected expenses, such as medical bills, legal fees, car repairs, or home repairs.

It’s important to carefully consider your financial situation before taking out an installment loan. Make sure you can afford the monthly payments and that the loan is a good financial decision for you. If you’re not sure whether an installment loan is the right choice for you, it may be helpful to talk to a financial advisor or a credit counselor.

Where can I get an installment loan for bad credit?

There are several places you can get an installment loan for bad credit, including:

  • Online lenders: Many online lenders offer installment loans for bad credit. You can apply for a loan online and receive a decision quickly.
  • Credit unions: Credit unions are often more willing to work with borrowers who have bad credit. You may be able to get an installment loan from a credit union if you are a member.
  • Traditional banks: Some traditional banks offer installment loans for bad credit, although you may have a harder time getting approved for a loan if you have a low credit score.
  • Peer-to-peer lenders: Peer-to-peer lenders are online platforms that connect borrowers with individual investors who are willing to lend money. You may be able to get an installment loan from a peer-to-peer lender even if you have bad credit.
Miranda Marquit
Meet the author

Miranda has been covering personal finance topics for more than 10 years as a freelance writer and journalist. She has contributed to Forbes, NPR, MarketWatch, Yahoo! Finance, U.S. News and World Report, and many other media outlets. Miranda has an M.A. in Journalism and is currently working on an MBA. She lives in Idaho with her son, where she enjoys reading, travel, and the outdoors.