4 Loans for People with Bad Credit or No Bank Account

If you’re struggling to build or repair your credit, you know the vicious cycle all too well. You need money to pay for, well, life, and some of those payments require credit.

But with a bad credit score or no access to a bank account, you may find yourself stuck without an option. So, you fall behind on your payments, which means your credit score gets even worse.

struggling couple

A personal loan can help ease this kind of financial burden by allowing you to finally get ahead. A small windfall can help you pay off existing debts or cough up a down payment on a necessary investment.

Best Installment Loans for Bad Credit

Even if you don’t have a great credit history, these lenders may have a personal loan that’ll suit your needs. Some of them can even let you know if you qualify without a hard credit check. This will save you from making your credit even worse.

1. MoneyMutual

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Operating “at the speed of life,” MoneyMutual understands that sometimes, you need cash right now. That’s why you can get your bad credit loan of up to $2,500 in as little as one business day after your application’s been accepted.

There are no minimum credit score requirements, and you can be approved even if you’ve been involved with bankruptcy or other serious credit hassles.

  • Loan Amount: Up to $2,500
  • APR: Variable
  • Term: Variable

2. Cash Advance

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Personal loans from Cash Advance are on the smaller end of the spectrum. They generally cap out at $1,000. However, they still offer longer repayment periods of up to a year and much more reasonable rates than you’d find at a typical payday loan vendor.

  • Loan Amount: $100 – $1,000
  • APR: Variable
  • Term: Variable

3. Lending Club

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Lending Club offers personal loans of up to $40,000 with generous repayment terms, allowing you to chip away at the total over the course of up to five years.

In addition, depending on your creditworthiness, you may be able to secure a loan with an interest rate below 10% APR.

  • Loan Amount: Up to $40,000
  • APR: 6.95% – 35.89%
  • Term: 36 – 60 months

4. OneMain

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With bad credit loans ranging up to $30,000, OneMain is the perfect place to secure the personal loan you need. You can use it for debt consolidation, dealing with an unexpected life event, or even home renovations.

After completing the easy online application, you’ll be invited to meet a loan specialist in person to nail down the exact terms of your agreement.

  • Loan Amount: $1,500 – $30,000
  • APR: 16.05% – 35.99%
  • Term: 24, 36, 48 or 60 months

Although living debt-free is the ideal scenario, life can sometimes be less than ideal—and expensive! Fortunately, if you need fast cash, these vendors can help you find the personal loan you need, even if your credit isn’t quite where you want it to be. (Yet.)

Here’s what you need to know to get your hands on that loan you need and turn your financial landscape around.

Can you get a loan without a bank account?

Maybe you’ve already been searching for a loan for some time, but you’ve realized you’re missing an important requirement: a bank account. Most online lenders require a bank account to initiate the transaction as part of their eligibility prerequisites. You may also have to meet other requirements, such as income thresholds or holding permanent U.S. residency or citizenship.

Types of Loans Available for People with Bad Credit and No Bank Account

Securing a loan can be challenging for individuals with bad credit and no bank account, but there are still options available. Here are various types of loans that cater to this specific financial situation.

  • Payday loans: Payday loans are short-term loans that are typically due on your next payday. These loans don’t usually require a credit check or a bank account, making them a viable option for those with bad credit. Borrowers can receive cash or a check and must repay the loan with interest and fees on the agreed-upon date.
  • Title loans: Title loans involve borrowing money against the value of your vehicle. The lender holds on to the title of your vehicle as collateral until the loan is fully repaid. These loans do not require a bank account and credit checks are often minimal. However, there’s a risk of losing your vehicle if you fail to repay the loan.
  • Pawn shop loans: Pawn shops offer loans in exchange for personal items of value. Items are held as collateral until the loan, plus interest and fees, is repaid. This type of loan doesn’t require a bank account or a credit check, but the loan amount is usually a small percentage of the item’s actual value.
  • Installment loans: Some lenders offer installment loans to individuals without a bank account and with poor credit. These loans are repaid over time with a set number of scheduled payments. While more accessible, these loans can come with high-interest rates and fees.
  • Cash advance apps: Several cash advance apps now offer the option to get a small advance on your next paycheck without a bank account. These apps typically require proof of income, but do not conduct credit checks. However, they may have limits on how much you can borrow.
  • Payday alternative loans (PALs): Offered by some credit unions, PALs are a safer alternative to traditional payday loans. These loans typically have lower interest rates and longer repayment terms. To be eligible for a payday alternative loan, you typically need to become a member of the credit unions offering them.
  • Community Development Financial Institutions (CDFIs): CDFIs are financial institutions like credit unions or nonprofit loan funds that may offer loans to individuals in underserved communities. They often provide more flexible terms than traditional banks and cater to individuals with bad credit and no bank account.

Applying for a Loan Without a Bank Account

Applying for a loan without a bank account requires thorough preparation. Here’s what you need to have ready:

  1. Valid identification: This is non-negotiable. Lenders must confirm your identity. Typical forms include a driver’s license, state ID, passport, or other government-issued identification.
  2. Proof of income: While not all loan types require this, many lenders require proof of your ability to repay the loan. This could be pay stubs, social security documents, or even bank statements if you use alternative banking services.
  3. Employment verification: Some lenders may also require proof of employment. This could be in the form of an employment verification letter or recent pay stubs that indicate your employer and earnings.
  4. Collateral: For title loans, this means your vehicle and its associated paperwork. Pawn shop loans will require an item of value, like electronics, jewelry, or musical instruments. Ensure the collateral is in good condition and valued accurately.
  5. Additional documentation: Depending on the lender, you might also need to provide other documents, such as utility bills or rental agreements, to further establish your identity and financial situation.

Considering the Risks

These loans come with a number of risks that need to be understood:

  • High-interest rates: Before considering payday or title loans, remember they typically have higher interest rates than traditional loans, which can lead to a significant increase in the total amount you owe.
  • Short repayment terms: Many such loans need to be repaid quickly, often within weeks or months, which can be a strain on your finances.
  • Potential for debt cycles: The combination of high interest and short repayment periods can trap borrowers in a cycle of debt, where they continuously need to take new loans to pay off old ones.
  • Risk of losing collateral: With title and pawn shop loans, failure to repay means losing your vehicle or pawned item, which could worsen your financial situation.

Alternative Solutions

Consider these more sustainable options:

  1. Opening a basic bank account: Many banks offer basic or “no-frills” accounts with minimal fees. Having a checking or savings account opens up more traditional and often less costly loan options.
  2. Financial counseling: A financial counselor can help you understand your financial situation better and offer strategies to improve it. This may include budgeting, debt consolidation plans, or building a savings plan.
  3. Credit building tools: Tools like secured credit cards or credit-builder loans can help improve your credit score over time, making you eligible for better loan terms in the future.
  4. Community resources and assistance: Explore local resources like non-profit financial assistance, community lending circles, or government programs designed to help those in financial need.

Why is a bank account required for most loans?

An active bank account is required for most loans because it gives a lender vital insight into your financial situation. Although it is only one piece of the puzzle, most lenders like to see that an applicant has a bank account. This is all part of the lender’s decision to determine whether you are a trustworthy borrower. Even some payday lenders may require a bank account.

There are also practical reasons why lenders require customers to have a bank account. Bank accounts are an extremely convenient way to provide credit and collect payments. The reality is that many creditors simply are not equipped to lend money in any other way.

Fee-Free Checking Accounts

Unfortunately, it’s difficult to find a legitimate personal loan lender who doesn’t require a checking account. In fact, all the online lenders we’ve listed below do.

You don’t want to keep paying a monthly maintenance fee just to keep your bank account open, especially if you can’t afford that $10 or $15. (And hey, even if you earn a lot, ten bucks is ten bucks!)

The internet has made it easy to find free online checking accounts with no minimum deposits and no monthly fees. One of the most well-regarded of these is Chime.

There are plenty of other no-fee checking accounts available for those willing to forego the sticks-and-bricks bank. And once you sign up, you’ll be eligible to take out the unsecured loan you need!

What to Look for in an Online Bank Account

When evaluating online bank accounts, consider these essential aspects:

  • Fees and charges: Opt for accounts with minimal monthly maintenance fees. Pay attention to ATM fees, especially if using out-of-network ATMs, and understand the costs and protections against overdrafts.
  • Interest rates: Seek accounts with attractive interest rates, particularly for savings. Some online banks also offer interest on checking accounts, which can be a bonus.
  • Accessibility and convenience: The bank should have a wide ATM network and provide an efficient online and mobile banking experience, including features like mobile check deposit and easy bill payment.
  • Security measures: Ensure the bank is FDIC insured for deposit protection. Also, assess the bank’s digital security measures, such as encryption and fraud monitoring, to safeguard your financial information.
  • Customer support: Good customer support is essential, especially in an online setting. Look for banks that offer comprehensive support through phone, email, and chat, ideally available 24/7.
  • Additional features: Some banks may offer additional perks like integrated budgeting tools or a variety of account types, including checking, savings, and investment options, which can be advantageous.
  • User reviews and reputation: Investigate the bank’s reputation through customer reviews and its standing in the banking community to get a sense of its reliability and service quality.

Frequently Asked Questions

Can you get a loan with bad credit and no bank account?

It is possible to get a loan with bad credit and no bank account. However, the easiest loans available to those in such situations are often risky.

If possible, it’s much better to open a fee-free online bank account and look for a suitable installment loan instead.

Can I get a cash advance loan without a bank account?

Yes. These types of short-term loans, while financially risky, are easy to be approved for. Many payday loan and title loan lenders typically allow customers to borrow money without a bank account. The trade-off, however, is a loan with an extremely high interest rate.

What is the easiest loan to get approved for?

The easiest loans to get approved for are secured loans from payday lenders. Other things like auto title loans and pawn shop loans are also among the easiest to land. The downside of easy approval, however, are huge interest rates and financial risk.

What is the easiest loan to get with bad credit?

As with loan approval in general, the easiest loans to be approved for with bad credit are the riskiest ones. A more sensible option would be to seek bad credit installment loans from reputable lenders who specialize in providing credit to those with poor credit scores.

Final Word

If you don’t have a bank account, securing a personal loan can be both expensive and risky. If your credit score is bad, opening a no-fee online bank account could help you find safer loan options. It might also be worth trying to borrow from a trusted family member or friend. 

Regardless of why you don’t have a traditional bank account, try to avoid committing to high interest cash advance loans and see if you can open an account online.  

Remember that any loan you take on should be clearly accounted for in your budget so that you can comfortably meet the repayment terms.

Jamie Cattanach
Meet the author

Jamie Cattanach is a freelance writer whose work has been featured at Fodor's, Yahoo, SELF, The Motley Fool, Roads & Kingdoms, and other outlets.