When you have bad credit, it seems like it comes back to haunt you at the most inconvenient times. But, whether you have a medical emergency or your car gets totaled, there may come a time when you need extra cash fast.
You don’t have to resort to title loans or payday lenders automatically. There are actually several online lenders who specifically cater to people with bad credit.
With the installment loans below, you will receive a higher interest rate than borrowers with good credit. But, you can sometimes use them to pay off credit cards with even higher interest rates.
8 Best Personal Loans for Bad Credit
To help you with your search, we’ve compiled a list of the best online personal loans for people with bad credit history. You’ll see a diverse mix of options and ideally find the right choice for you.
Loan Amount$250 – $2,500
Min. Credit ScoreVaries
MoneyMutual is an online matching service for small short-term loans. Although it is not a direct lender, it can help you find the best lender for you.
To get started with MoneyMutual, you will fill out a form with your information for lenders to review. You may get several offers in a few minutes from various lenders.
Remember, you are under no obligation to accept any of the offers. Make sure to read through the loan terms of each offer and ensure it fits into your budget before accepting the loan agreement.
A few of the borrow requirements include some form of consistent income that totals at least $800, a minimum age of 18, a legal resident of the U.S., and an active checking account. If you can provide information that confirms each of these requirements, you will likely receive several loan offers.
If you need money quickly, this could be a good option because you may receive the funds within 24 hours.
Loan Amount$500 – $10,000
Loan Term3 to 72 months
Min. Credit ScoreFlexible
CashUSA is an online lending portal that puts you in touch with offers from a partner lender.
Income and credit requirements are flexible, so it’s a quick and easy way to access personal loan funds, regardless of your credit history. So if you have a poor credit score but need a personal loan, you could potentially qualify for a loan through CashUSA’s network.
Lenders through this website offer personal loans for bad credit for as little as $500 or as much as $10,000. APRs range from 5.99% and 35.99%.
What are some of the requirements for a personal loan through CashUSA’s network?
You need to be 18 years old and have a valid bank account. This is used for both depositing your funds and automatically withdrawing your monthly payment on the due date. You also need to make at least $1,000 after taxes each month.
To submit a loan request, you fill out one simple form through their website.
When you accept a loan you like, you can get funds fast — sometimes as fast as the next business day.
Loan Amount$500 – $10,000
Loan Term3 to 60 months
Min. Credit ScoreNone
Rather than being a direct lender, BadCreditLoans.com serves as a loan marketplace that works with multiple lenders.
That means that after filling out a single request form, the website sends your information to their large lender network that can then respond to you with a loan offer.
As the name implies, they truly cater to people with extremely low credit scores who need cash fast.
Here are some of the requirements the lenders are looking for. You need to be at least 18 years old, a legal U.S citizen and have a steady income for the last 90 days (either through a job, disability, or Social Security).
You must wait to receive an offer from the website’s network of lenders. Depending on your request, you may or may not be offered a personal loan.
You’re never under any obligation to accept any offer you receive, so you can make sure it fits your budget before deciding.
Loan Amount$500 – $35,000
Loan Term3 to 72 months
Min. Credit Score580 – 600
PersonalLoans.com is another loan marketplace where you get connected with a lender based on a single online form.
Because the lenders vary, the available APRs vary as well. Expect to see personal loan interest rates from 5.99% to 35.99%.
They work with three different types of lenders, each of which has different minimum requirements. For example, P2P lenders require a minimum credit score of 600, and you must also earn at least $2,000 a month in verifiable income.
Both installment lenders and bank lenders require just a 580 score, although, with a bank loan, you’ll need at least $3,000 in income. In addition, you must be at least 18 with a social security number, regular income, and a valid checking account to qualify for all bad credit personal loans.
Another requirement is that even with bad credit history, you cannot have had an account with a late payment longer than 60 days or a recent bankruptcy.
If you meet these requirements, this could be an excellent choice for several different types of bad credit loans.
Loan Amount$1,000 – $10,000
Min. Credit ScoreVaries
NetCredit has a Built-In Credit-Builder program that ensures your payments are reported to two credit bureaus (Experian and TransUnion), so you can take full advantage of paying back your personal loan on time.
Here’s what you need to know about NetCredit loans.
They will check your credit score, but it’s only a soft pull, so it won’t hurt your credit. If you qualify, you can either accept the loan terms as they are or choose to “modify your loan details.”
Loan rates and term lengths with NetCredit vary depending on the state in which you live. In general, expect to start around 36%. However, in some states without rate limits, you might see that number jump up to 155%.
NetCredit personal loans are available in the following states:
Alabama, Arkansas, Arizona, California, Delaware, Florida, Georgia, Idaho, Indiana, Kansas, Kentucky, Louisiana, Michigan, Mississippi, Missouri, Montana, Nebraska, North Dakota, New Mexico, Ohio, Oregon, South Carolina, South Dakota, Texas, Utah, Virginia, Washington, Washington DC, and Wisconsin.
You’ll want to be careful of the high end of NetCredit’s interest rates. However, you may want to consider them if you live in one of the eligible states and don’t have excellent credit.
Loan Amount$1,000 – $35,000
Loan Term2 to 5 years
Min. Credit Score600
Avant is a solid lender for borrowers of any credit type. They offer higher loan amounts, and interest rates range between 9.95% and 36% APR.
But here’s what we really love about Avant.
Most borrowers with this lender actually report quick upticks in their credit scores. Why? More than half of all Avant loans are used to consolidate credit card debt. As a result, users report an average of a 12-point jump in credit score within the first six months of having the loan.
If you don’t need to consolidate your debt, you can also apply for a loan to pay for home improvement costs or emergency expenses.
With over 600,000 customers helped and a decision within minutes of applying online, they offer a lot to borrowers who need financial help while remedying bad credit.
Loan Amount$3,500 – $20,000
Loan Term24 to 48 months
Min. Credit Score600
LendingPoint targets poor and fair credit borrowers looking for a personal loan. You can borrow anywhere between $3,500 and $20,000 with interest rates ranging from 17.46% to 35.99% APR.
All personal loans are subject to a flat origination fee of 5% which will be deducted from the loan proceeds you receive. To qualify, you’ll need a minimum gross annual income of $25,000.
Another requirement is that your debt-to-income ratio should be no more than 45%.
Finally, applicants must live in one of the following states: Alabama, California, Colorado, Delaware, Georgia, Michigan, Missouri, Montana, New Jersey, New Mexico, North Dakota, Ohio, Oregon, South Dakota, Texas, Utah, and Washington. If you meet these basic qualifications, then you’re a strong candidate for an unsecured loan.
Their loan application process is easy. Just pull together some basic documents, like your proof of employment and income, recent bank statements, a voided check, as well as your driver’s license.
Once you sit down to apply online, it should take no more than five minutes. If you’re approved, LendingPoint will provide you with different loan options to choose from. Pick one and receive your funds as soon as one day later.
Loan Amount$1,500 – $25,000
Loan TermUp to 60 months
Min. Credit ScoreN/A
OneMain is a well-established lender specifically targeting individuals with bad credit. Typical APRs range from 25.10% and 36.00%.
The amount you can borrow depends on where you live, but you’ll find the scale goes anywhere from $1,500 to $25,000. The origination fee ranges from $25 to $40.
To qualify for a loan with bad credit, you’ll most likely need to take out a secured personal loan. For secured loans, you can use an automobile, truck, motorcycle, camper, or RV as collateral.
Whatever you choose, you must have an appraisal completed to ensure its value meets the amount of your loan. Vehicles also must be insured while the loan is active.
An interesting step in OneMain’s loan approval process is that you must actually go to a physical branch location to bring in your documents for verification and discuss your loan options.
Once you get your personal loan, you have flexible payment options each month. You can pay online or through their app, at a branch, through the mail, or even at a Walmart Service Desk. However, there is a fee each time you pay by debit card or at a Walmart.
How to Get a Personal Loan with Bad Credit
Even with a bad credit score, there are several places you can go to look for a loan. One option is a local bank or credit union, especially if you’re already a member.
Credit unions – Some credit unions offer unsecured loans for bad credit with less stringent lending guidelines, and you may get a lower interest rate. The only issue is, you’ll likely need to apply in person, and you may have to wait longer to get the funds once you’re approved.
Get a cosigner – Some personal loan lenders allow you to add a second borrower to the application to include their credit and income to improve your chances of approval. The installment loan will also appear on their credit report, however, so any late payments or delinquencies affect them as well.
Home equity loans – If you have equity in your home, you may also want to consider a home equity loan.
Online lenders – It’s often the easiest and most convenient way to apply for personal loans for bad credit. That’s because there are lenders who specifically work with credit-challenged individuals.
Remember that you should only consider taking out an unsecured personal loan if you’re confident in your ability to repay it.
What to Look for in an Online Lender
The two biggest things to look at with an online lender (especially those who brand themselves as bad credit lenders) are transparency and security.
Unfortunately, the Internet is riddled with scammers and predatory lenders, but there are several steps you can take to avoid getting into trouble. In most cases, you should also avoid taking out payday loans. The interest rates on payday loans are far higher than other personal loans for bad credit borrowers.
Registered in Your State
First, make sure the lender is registered to do business in your state. You can find this out by contacting your state’s financial institution regulatory bureau.
Also, make sure the lender’s website begins with “https” rather than just “http” — that indicates a safe, secure site where your personal information can’t easily be compromised.
Once you’ve established these two items, next look for transparency in fees and repayment terms. Carefully read all of the fine print on the lender’s website.
You should never be asked to pay any fees upfront before receiving your loan funds. In fact, reputable lenders deduct their origination fees from the loan funds, so you never pay anything except your monthly bill.
Credit Bureau Reporting
A final tip is to check and see if the lender reports to the major credit bureaus. It helps to improve your credit score if your timely payments are regularly reported.
A prepayment penalty is a fee for paying off your loan early. You can also be charged a prepayment penalty for paying more than the standard payment. Obviously, you will want to look out for and avoid lenders that have them.
What to Expect with a Bad Credit Loan
When you start looking for unsecured personal loans online, it’s important to know a few different things. First, the worse your credit score is, the higher your annual percentage rate (APR) will be — both your interest rate and often your origination fee.
Don’t be surprised to see bad credit loans with an APR of 20% or more. Unfortunately, it’s also likely that you’ll only have access to lower loan amounts.
If you have really poor credit, you might only qualify to borrow $1,000 or $2,000. Pay careful attention to your actual loan needs and what your monthly payments look like. If it is really going to pinch your budget, it may not be worth it.
This is especially true if your lender requires you to use collateral for a secured loan. That’s how many lenders are able to offer bad credit loans. They have you use your personal property to secure the loan — whether it’s your car, boat, or savings account. Interest rates will generally be lower on secured loans than they are with unsecured loans.
Defaulting on a Personal Loan
If you default on your personal loan, the lender then takes possession of that collateral to offset the loan cost. This really ramps up the stakes of a bad credit personal loan, so be sure to proceed with caution.
However, if you pay off the personal loan quickly and on time, those regular payments could positively affect your credit report. This will put you on the path to a better credit score (and consequently, better credit offers in the future).
A bad credit loan is not a great option for most people to pay off high-interest credit cards as credit card debt usually already has lower interest rates. But, in some cases, it might make sense.
If your goal is to consolidate debt, the best way to do that is to improve your credit history. Then, you can qualify for either balance transfer credit cards or debt consolidation loans. Getting a debt consolidation loan would allow you to pay off all types of debt, not just credit cards.