Best bad credit loans in united states

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Avant: Best for quick funding

• Minimum credit requirement: 580
• APR: 9.95% – 35.99%
• Terms:  12 to 60 months
• Origination fee: Up to 4.75%

Why we like it: If you’re approved for a personal loan with Avant, your funds may be deposited into your bank account as soon as the next business day.

 

Overview: Avant has higher interest rates than some lenders, but you may receive your loan faster than its competitors. This online lender also allows borrowers to change their loan due date up to the day before the deadline. Plus, Avant offers secured loans for those who don’t qualify for an unsecured loan. Getting a secured loan may also help you to get lower rates, though you stand to risk losing any collateral you put down, so be sure you’re able to repay your loan. Minimum loan amounts may vary by state.

Pros	Cons
No prepayment penalties   May receive funds as soon as the next business day   May consider household income instead of just individual income	Charges late and dishonoured payment fees   Charges an origination fee of Up to 4.75%   Can only borrow up to $35,000

 

Eligibility requirements: Avant doesn’t provide many details on its website as to its eligibility requirements — however, you’ll have to verify your identity, employment, income and bank account.

Read Avant review

Happy Money: Best for few fees

• Minimum credit score: 640
• APR: 11.25% – 24.50%
• Terms: 24 to 60 months
• Origination fee: 0.00% - 5.00%

Why we like it: Other than its origination fee, Happy Money doesn’t charge application fees or prepayment penalties or late.

 

Overview: Happy Money bad credit loans are specifically available to help borrowers eliminate credit card debt. While you may not be eligible for Happy Money’s lowest interest rates, their personal loan rates may be lower than those on your current credit card. If you’re approved by this lender, you can typically expect to see your lump sum deposited into your account within three to six business days, which can be much slower than other lenders on this list.

Pros	Cons
No application or late fees   No prepayment penalties   May offer lower interest rates than credit cards   Transparent about its eligibility requirements	No joint applications are available   Not available to residents in Massachusetts or Nevada   Loans can only be used toward paying off credit cards font-variant-east-asian: normal; font-variant-numeric: normal; line-height: 1; margin: 0px; padding: 0px; speak: none;">  The funding timeline can be slow

 

Eligibility requirements: You’ll need to meet the following requirements to be eligible for a personal loan with Happy Money:

• At least three years of credit history
• A debt-to-income ratio of less than 50%
• No current delinquencies
• Minimum credit score of 640

Read the Happy Money review

LendingClub: Best for using a co-borrower

• Minimum credit requirement: Not specified
• APR: 9.57% – 36.00%
• Terms: 24 to 60 months
• Origination fee: 3.00% - 8.00%

Why we like it: Unlike some other competitors, LendingClub allows applicants to apply for a joint personal loan with a co-borrower.

 

Overview: LendingClub is a peer-to-peer lending marketplace through which you can borrow up to $40,000 and get funds in as little as 24 hours. You may also change your due date with LendingClub — either as a one-time occurrence or permanently — but be sure to check how changing your payment deadlines could affect your interest rates. You’ll need to be current on your payments to change your due date.

 

As an added bonus for borrowers with low credit scores, LendingClub also offers joint personal loans. The option to add a co-borrower may make it easier for some applicants with poor credit to qualify for a personal loan.

Pros	Cons
15-day grace period if you’re late on payments   Allows for co-borrowers   Option to pay creditors directly if using funds to consolidate debt	Borrowers in Iowa and U.S. territories aren’t eligible   Charges late fees   Charges an origination fee between 3.00% - 8.00%

 

Eligibility requirements: To qualify for a personal loan with LendingClub, you’ll need to be a U.S. citizen who’s at least 18 years old and have a verifiable bank account.

Read LendingClub review

LendingPoint: Best for loan-term flexibility

• Minimum credit requirement: 640
• APR: 7.99% – 35.99%
• Terms: 24 to 72 months
• Origination fee: 0.00% - 8.00%

Why we like it: With personal loan terms of 24 to 72 months, LendingPoint has some of the most flexible loan terms on our bad credit loans list.

 

Overview: LendingPoint sees your credit score as only one piece of the financial puzzle. In addition to your credit, this lender also evaluates your job history, financial track record, personal income and recent credit behaviour using artificial intelligence. If you’re approved, your funds may be deposited in your account as soon as the next business day.

 

LendingPoint applicants must have an annual income of $40,000 or higher and cannot apply with joint or cosigned loans.

Pros	Cons
May receive funds one business day after approval   The approval process doesn’t just rely on credit score   No prepayment penalties	Loans not offered in Nevada or West Virginia   Doesn't offer joint applications   Must have an annual income of at least $45,000

 

Eligibility requirements: You’ll need to meet the following requirements to qualify for a personal loan with LendingPoint:

• Must be at least 18 years old
• Must provide a government-issued identification
• Must have a Social Security number
• Must have a minimum annual income of $40,000
• Must have a verifiable bank account
• Must not live in Nevada or West Virginia

Read LendingPoint review

OneMain Financial: Best for secured loans

• Minimum credit requirement: Not specified
• APR: 18.00% – 35.99%
• Terms: 24 to 60 months
• Origination fee: 1.00% - 10.00%

Why we like it: For borrowers with bad credit, OneMain Financial offers both unsecured and secured loans — the latter of which may require collateral (a vehicle, for example).

 

Overview: OneMain Financial has the lowest loan amount cap ($20,000) on our bad credit loans lender list, so this company may be best for those searching for bad credit small personal loans.

 

While OneMain Financial’s interest rates are fairly high, they may be lower than what you may find with other bad credit loan companies and predatory lenders. OneMain Financial charges late fees either ranging from $5 to $30 or as a percentage of your entire monthly payment charge (or the late portion of your monthly payment), which can range from 1.5% to 15%.

 

Pros	Cons
Offers both secured and unsecured loans   Ability to change your payment due date   No prepayment fees	APR is higher than some other lenders   Charges late fees   Small maximum loan amount

 

Eligibility requirements: OneMain Financial doesn’t provide specific details on eligibility criteria, but it does take the following into consideration:

• Your personal financial history
• Your credit history
• Your income
• Your expenses
• The purpose of your loan
• If you’ve filed for bankruptcy
• Where you live

Read OneMain Financial review

Upgrade: Best for flexible loan amounts

• Minimum credit requirement: 580
• APR: 8.49% – 35.99%
• Terms: 24 to 84 months
• Origination fee: 1.85% - 9.99%

Why we like it: You could be eligible to borrow as little as $1,000 or as much as $50,000 if you qualify for a personal loan from Upgrade.

 

Overview: This online lender not only offers a wide range of loan amounts that consumers can choose from, but borrowers can also receive their loans as quickly as one business day after verifications are cleared. Furthermore, you could get a discount on your rates — though the lowest rates require borrowers to sign up for autopay, and they would also have to repay some of their current debts directly.

 

However, not only does Upgrade charge an origination fee (ranging from (1.85% - 9.99%), but if borrowers are unable to keep up with their payments, this online lender also charges late and failed payment attempt fees.

 

Pros	Cons
Can receive funds in as little as one business day   Offers autopay discount   Offers auto-secured loans	Not available in West Virginia or Washington, D.C.   Charges $10 late fees and $10 failed payment attempt fees   Charges an origination fee

Eligibility requirements: While Upgrade doesn’t offer clear-cut criteria on its website, to qualify for a personal loan, you must be at least 18 years old and a resident of the U.S. Upgrade will also take your credit profile, score, usage and history into consideration.

Read Upgrade review

Upstart: Best for thin credit histories

• Minimum credit requirement: 300
• APR: 4.60% – 35.99%
• Terms: 36 and 60 months
• Origination fee: 0.00% - 12.00%

Why we like it: Upstart uses artificial intelligence (AI) rather than traditional FICO credit score models to make lending decisions.

 

Overview: Like Upgrade, Upstart offers flexible loan amounts to borrowers, providing larger personal loans for poor credit than many other conventional lenders. The minimum amount you can borrow depends on your residence, though Upstart doesn’t serve residents in Iowa or West Virginia.

 

Upstart’s application process may make it easier for some consumers with thin credit histories to qualify for a personal loan since this lender also takes into account your level of education, areas of study and employment history. If you’re approved, you could receive your funds as soon as the next business day.

Pros	Cons
Loans can be used toward education-related expenses   Can receive funds in one business day   Flexible loan amount options	No option to apply with a co-borrower   Not available in Iowa or West Virginia   Limited loan terms

 

Eligibility requirements: Aside from meeting Upstart’s minimum credit score requirements, potential borrowers will also have to meet the following criteria:

• Be a U.S. citizen or a permanent resident
• Be at least 18 years old
• Provide an email address
• Provide their name, date of birth and social security number
• Have a full-time job or an offer to start within six months (or some form of regular income)
• Have a personal bank account

Read Upstart review

*The full range of available rates varies by state. The average 3-year loan offered across all lenders using the Upstart platform will have an APR of 21.97% and 36 monthly payments of $35 per $1,000 borrowed. For example, the total cost of a $10,000 loan would be $12,646 including a $626 origination fee. APR is calculated based on 3-year rates offered in the last 1 month. There is no down payment and no prepayment penalty. Your APR will be determined based on your credit, income, and certain other information provided in your loan application. Not all applicants will be approved.

What are bad credit loans?

When lenders receive applications for personal loans, they typically take your credit score and overall creditworthiness into heavy consideration. Often, they require minimum credit scores to qualify — which can make it difficult for borrowers with poor credit to access these loans. Some lenders, however, offer personal loans for bad credit, meaning you can still qualify for a loan even if you have poor credit.

Unfortunately, those with unpolished credit scores often get saddled with higher interest rates and other less-than-ideal terms when applying for a loan. If you have bad credit, it’s typically difficult to qualify for a loan.

Bad credit loans generally come with fixed rates and are offered by lenders willing to loan you funds despite your limiting credit rating. You can use these types of loans for building credit so you can eventually become eligible for better loan terms and other financial opportunities.

 how to get a bad credit loan

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It’s possible to get a personal loan with bad or no credit. However, if you take the time to work on your credit, you could save a lot of money by benefiting from a lower interest rate. If you need a personal loan now, however, consider these tips for finding the best personal loan for bad credit for you:

1. Check your credit score. Keeping tabs on your score can help you gauge which lenders you may qualify with. You can check your credit score at LendingTree to see where you stand, and then find ways to improve your credit score. Since your score is generated by the information in your credit report, you can also request your credit reports from the three major bureaus through AnnualCreditReport.com to look for and dispute any errors.
2. Seek lenders that consider more than just your credit. Lenders whose assessments of your creditworthiness aren’t solely dependent on your FICO Score may be easier to qualify with, depending on your financial situation. For instance, some lenders may also take into account your income, employment and education level.
3. Prequalify for loans online. Through loan prequalification, you can check whether you’re likely to be approved for a loan and what rates you might be eligible for — the process won’t harm your credit score, as it only generates a soft inquiry. This can be a good way to assess what you could qualify for and how much it would cost you in the long term.
4. Compare loan offers. Once you’ve received a few personal loan offers, you’ll want to select the best option for you. That means reviewing interest rates, lender fee structures and available terms.
5. Submit an application. After narrowing down your options, it’s time to submit a formal application. This will trigger a hard inquiry, which will temporarily lower your credit score. After applying, you may need to wait a few business days to receive a loan decision. If your application is denied, you’ll typically be notified of the factors that contributed to the denial.

Where to find bad credit loans

Personal loans for bad credit can be found at a variety of types of institutions. At LendingTree, you can browse through our personal loan marketplace to compare eligibility requirements, interest rates, terms and loan amounts.

Here are a few different types of lenders that we offer where you can start your search:

• Banks: Some banks, such as Wells Fargo Bank, offer personal loans. However, you may be required to visit the bank’s local branch to go through the application process. While the online process can be convenient, visiting a branch can provide a personal touch when seeking a personal loan.
• Credit unions: Getting a personal loan through a credit union often requires borrowers to be members of that institution. For instance, with PenFed Credit Union, you don’t have to become a member to apply, but if you decide to proceed with your offer, you’ll have to become a PenFed member to close the loan.
• Online lenders: When applying for a personal loan through an online lender, the process is typically 100% remote. You’ll fill out an online application and then submit documentation to verify your identity, income and address.

Types of loans for bad credit

Bad credit loans aren’t just limited to traditional, unsecured loans. Here are the types of loans you can get with bad credit.

Secured loans

With a secured loan, you’ll have to offer your lender an asset as collateral, like a car, a home or even a savings account. Because secured loans require valuable collateral, they’re often easier to obtain than unsecured loans and generally offer better rates, since the lender is at less risk.

Best for: Consumers with bad credit who own valuable collateral they can afford to lose should they default on the loan.

What to like: Borrowers with poor credit may qualify for lower interest rates since they’re putting up collateral.

What to watch out for: If you default on a secured loan, your lender may legally confiscate your collateral to recover the money. And if your lender doesn’t recoup the cost of the loan by redeeming your assets, you may be responsible for the difference.

Unsecured loans

Since unsecured loans don’t require borrowers to offer up collateral, lenders of these types of loans mostly rely on factors such as credit history, income and debt obligations to determine your eligibility. Unlike secured loans, if you default on an unsecured loan, your lender cannot seize your assets.

Best for: Most borrowers could qualify.

What to like: If you’re unable to repay your unsecured loan, your lender cannot seize your assets.

What to watch out for Because these types of loans don’t require collateral, lenders that offer unsecured loans rely heavily on your creditworthiness when it comes to approval and offers. This means that if you don’t have good or excellent credit, you may have a hard time qualifying for or receiving low-interest rates. If you default, your credit score is likely to take a major hit.

Joint personal loans

If your credit score isn’t relatively high enough to get you approved by a lender, consider getting the support of a loved one and file for a joint personal loan. This enables you to apply for a personal loan with a second person.

Best for: Borrowers with poor credit who have a supportive family member or friend willing to back their loan request.

What to like: This approach can make it easier for consumers with bad credit to be eligible for a loan, as it lowers the primary borrower’s risk.

What to watch out for: If you’re unable to make payments on this type of loan, not only can your lender attempt to collect from you, but they can also try to collect on the loan from your co-borrower. This can also impact both your and your co-borrower's credit scores.

Payday loans

Payday loans are considered a more dubious type of loan, with astoundingly high fees and interest rates. These loans are typically less than $500 and are expected to be paid back within two to four weeks. Many people who take out payday loans often have to take out additional loans to pay off the original payday loan, trapping them in a cycle of debt.

Best for Those who can afford the sky-high fees and can pay the loan back right away — though it’s wise to avoid this type of loan if you can.

What to like: Payday loans don’t require credit checks, and you can often get your money right away.

What to watch out for: These types of loans are often predatory and may charge as much as 400% APR.

Cash advances

Cash advances are small, short-term loans that you can get from your credit card company. In these instances, you can withdraw cash from your credit card from your total balance.

Best for Those who are in financial emergencies and need money quickly.

What to like: You won’t have to go through a credit check and can receive money fast if you need it.

What to watch out for: You may have to pay a fee, and you’ll pay much higher APRs than you would on typical credit card purchases.

Bank agreements

If you have a strong relationship with your bank, you may be able to get what’s known as a bank agreement. This can take the form of a small, short-term loan or even the ability to overdraft on your account (up to a certain amount).

Best for: Consumers who have good histories with their bank.

What to like: If you need a short-term fix, you can use an already favourable relationship for financial assistance.

What to watch out for: This option may not be offered at all banks.

Bad credit home equity loans

If you have bad credit, you may be able to cash in on the equity you’ve built into your home using a home equity loan. These loans have fixed rates and are typically paid off between five and 30 years. Like personal loans, with a home equity loan, you’ll be given the money in a lump sum.

Best for Those who need large sums of money and have equity in their home

What to like: Allows borrowers to take out up to 80% of their home’s value.

What to watch out for: Because you’re using your home as collateral, defaulting on your home equity loan may result in losing your home.

HELOC loans for bad credit

A home equity line of credit (HELOC) works similarly to a credit card; consumers can borrow as much as they need (up to a limit) against their home’s equity and only have to pay back the amount they took out. Unlike home equity loans, HELOCs typically have variable interest rates.

Best for: Borrowers who aren’t sure how much money they need and want to be able to borrow from their home’s equity over some time

What to like: Consumers can borrow and pay back as needed, and reuse the line of credit.

What to watch out for Since interest rates are variable, borrowers may experience high monthly payments.

Student loans for bad credit

If you’re in school or preparing to attend college and have poor credit, you may be able to get student loans for bad credit to help cover expenses. While many lenders don’t allow borrowers to use a personal loan toward education financing, lenders like Upstart do allow for it.

Best for Those who are pursuing financing for educational purposes

What to like: Some student loan lenders will cover up to the entire cost of your tuition.

What to watch out for Some lenders have strict or vague forbearance and deferment programs — or none at all — in case you’re unable to repay the loan down the road.

Understanding your credit score

If you have bad credit, your score in most scoring models likely falls somewhere between 300 and 579. Poor credit may be a result of the lack of time or opportunity to build up your credit, financial missteps — such as missing payments or having a high debt-to-income ratio — or perhaps being a victim of a scam or identity theft.

Whatever the reason, lenders often consider your credit score as a signal of your creditworthiness, or how likely you are to pay them back. As a result, poor-credit borrowers often have to pay higher APR rates than those with good or excellent credit.

If you’re looking for a personal loan, here are some of our most recent statistics on what kind of APR you may expect based on your credit score.

Average personal loan APR by credit score

Credit score	Estimated APR
720+	10.58%
680-719	17.00%
660-679	24.16%
640-659	31.95%
620-639	40.57%
580-619	63.58%
560-579	100.53%
Less than 560	136.88%

Source: LendingTree data, Q2 2022

How to compare personal loans for bad credit

Compare lender APRs

The annual percentage rate (APR) is what your financial institution charges you for taking out a loan, but there is a difference between interest rate and APR.

While the APR does include the interest rate you’ll be paying to borrow the funds, it gives you a more comprehensive picture of how much your loan will cost, as it also includes any additional fees. The lower the APR is, the less the loan will cost you over time. Therefore, you may want to choose a lender that can offer you a lower APR.

Account for fees

Your financial institution could charge you several fees for your personal loan in addition to the annual interest rate. Some of these fees could include administrative costs deducted upfront from the amount you’re borrowing, while others could be charged for making a late payment or paying off your loan before the end of its term.

3 common personal loan fees

Late payment fee	The origination fee, if included, is typically equal to 1% to 8% of the total amount of the loan. It's a processing or administrative fee that is typically deducted upfront from the total amount you're borrowing.
Loan origination fee	The origination fee, if included, is typically equal to 1% to 8% of the total amount of the loan. It's a processing or administrative fee typically deducted from the total amount you're borrowing.
Prepayment penalty	You could be charged a prepayment penalty for paying off your loan ahead of time. However, most lenders don’t charge this fee for personal loans.

Read lender reviews

Do your due diligence when deciding on the best lender for your needs. As part of your research, make sure to read online personal loan lender reviews.

Examine repayment terms

Your repayment terms can make a difference in how large or small your monthly loan payments will be. Generally, lenders offer unsecured personal loan repayment terms between 12 to 60 months, but you can also find long-term loans with repayment terms as long as 144 months.

The longer your payment term, the higher your APR rate may be, but you’ll pay in smaller monthly payments. You’ll also pay more in total interest over the life of a long-term loan. If your repayment plan is shorter, however, your APR rates may be lower but your monthly payments will be larger.

While some lending companies only offer two or three different repayment terms, other companies may have more flexible terms to choose from.

How to spot scams for bad credit loans

Unfortunately, some poor-credit loans really are too good to be true. To avoid being scammed by a shady lender, be on the lookout for the following signs:

• The lender demands you pay fees upfront: A legitimate lending institution won’t ask for payment before you’ve been approved and received your loan. While some trustworthy lenders may require that you pay an application fee or a credit report fee, these are typically taken out of the loan you borrowed.
• The lender requires that you act immediately: If a lender is pressuring you to make a decision within a small window of time, that may be a red flag. A proper lender won’t corner you and understands that the decision to take out a loan may require some time to think over.
• The lender has no physical address: A reputable lender will have the company’s physical address listed on its website (not a post office box), and you’ll be able to confirm it by using Google Maps or a similar app.
• The lender is not registered in your state: Whether a lender is online or in person, to do business in your state, it must be registered in your state, according to the Federal Trade Commission (FTC). Lenders should note which states they are or aren’t registered with. If you’re suspicious of a scam, you can reach out to your state attorney general’s office to find out if that lender is registered where you live.
• The lender contacts you first: If you did not initiate contact with the lender, you may not want to answer any phone calls or other types of communication — it may be a ploy to get your financial information. A credible lender won’t cold call you, asking you to disclose your personal information.
• The lender doesn’t have a secure website: Some scammers may attempt to steal your information through their website. When researching bad credit loans, be sure to check that a website’s URL has the letter “s” following “HTTP,” as well as a padlock icon on pages that ask you for your financial information.
• The lender doesn’t check your payment history: A reputable lender won’t guarantee your approval for a loan. Legitimate lending institutions will first want to see your payment history, your credit and DTI ratio and other financial information.

What to do if you’ve been scammed

If you find out you’ve been scammed, the first step is to contact law enforcement and file a police report. Unfortunately, there may not be much they can do, but you’ll want to document the crime as much as possible.

Once you’ve filed a police report, you should also report the scam to the FTC Internet Crime Complaint Center. By reporting it, you could potentially prevent others from being scammed in the future.

Frequently asked questions

How we chose the best personal loans for bad credit

We looked at eight lenders that offered personal loan services with credit scores ranging from 585 to 640 to determine the best lenders for bad credit. By offering a detailed and objective account of each lender’s rates and terms, LendingTree’s goal is to provide you with all the information you need to make a financially sound decision specific to your situation.

Here are the criteria we assessed to choose the best poor credit lenders:

• Minimum personal credit score requirements below 640
• Transparent rates and repayment terms
• Flexible loan amounts