3 Best Installment Loans for People With Poor Credit

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If your credit is in a bad place, you’re not alone. Roughly 43 percent of millennials have a credit score between 500 and 600, according to a 2016 study by TransUnion.

If you need some cash, though, finding installment loans for people with poor credit isn’t easy.

It might feel like payday loans are the only option. Fortunately, that’s not the case. There are direct lenders for bad credit that offer loans at significantly lower rates.

Here are three of the top lenders out there today as well as the features and fees they offer as of September 2017.

At a glance: 3 best installment loans for people with poor credit

Lender Minimum Credit Score Pro Con
Avant 580 You can see offers before applying Doesn’t offer secured loans
OneMain Financial None Offers secured and unsecured loans Terms are vague
Your local credit union Might vary Payday alternative loans cap the APR at 28.00% You must be an eligible member of the credit union

Avant

Although many lenders offer more than one type of loan, Avant specializes in unsecured personal loans. The online lender requires a minimum credit score of 580 and offers interest rates between 9.95% and 35.99%.

Even if you qualify for Avant’s highest APR, you’ll get a much better deal than you would with a payday loan, which can charge an APR of 400.00% or higher, according to the Consumer Federation of America.

The biggest drawback to Avant is the fact that it doesn’t offer secured loans, which require collateral such as a car, a motorcycle, or home equity. With a secured loan, you sometimes can qualify with a lower credit score because the lender can mitigate risk with your collateral.

You can, however, get a preliminary offer from Avant with a soft credit check, so you don’t have to officially apply to see what the lender will offer.

Avant is transparent about its loan terms and fees. Here are some you should know:

  • You can borrow between $2,000 and $35,000.
  • Repayment periods range from 24 to 60 months.
  • There is an administrative fee up to 4.75% of loan balance of the amount of the loan.
  • The bank charges a $25 fee for late payments, but you can get a refund if you follow up your late payment with three consecutive on-time payments.
  • There’s a $15 dishonored payment fee if a payment is returned.
  • There’s no prepayment penalty fee.

OneMain Financial

If your credit score doesn’t meet Avant’s standards, OneMain Financial is a decent choice. The lender has no minimum credit score requirement. OneMain offers both secured and unsecured personal loans, giving you more options if you don’t qualify for an unsecured loan.

There’s one big problem with OneMain Financial, though: It isn’t forthcoming about its loan terms. For instance, you can’t find interest rate or fee information on its website. And when I called to verify information I found in other reviews, the answers were noncommittal.

Also, OneMain doesn’t offer pre-qualification with a soft credit check. Instead, you have to apply with a hard credit check to get an offer and see your terms.

Here’s what we do know:

  • You can borrow between $1,500 and $25,000 unless you live in California or Georgia. California’s minimum loan amount is $3,000, and Georgia’s minimum loan amount is $1,500 for current customers and $3,100 for others.
  • Repayment terms range from 12 to 60 months.
  • There’s no prepayment penalty fee, but you’ll pay an origination fee, which depends on the state in which you reside.

Your local credit union

If you’re a member of your local credit union, it might be your best chance to get great terms on an unsecured installment loan.

Some credit unions offer what they call payday alternative loans (PALs) for short-term cash needs. The best thing about them is the fact that the National Credit Union Administration requires that credit unions charge no more than 28.00% APR on PALs.

The main drawback is that you’re required to be a member of a participating credit union for at least one month before you can apply. So, if you need cash now, you’ll have to choose Avant or OneMain.

Another fact to keep in mind is that not all credit unions offer PALs. So, before you join one, double-check with a loan officer.

Here are other terms you can expect with a PAL:

  • You can borrow between $200 and $1,000.
  • Repayment terms range from one to six months.
  • There’s a maximum application fee of $20.
  • Other terms and fees might differ by credit union.

Which lender should you choose?

Although there aren’t many choices when it comes to installment loans for people with poor credit, it’s important that you choose wisely.

If you’re a member of a credit union, a PAL might be your best option unless you need more than $1,000 or a repayment term longer than six months.

If you do need more cash or a longer repayment term, consider Avant first. Its transparency and pre-qualification process make it clear what you’re getting.

But if you don’t meet Avant’s credit standards, OneMain Financial can save you money over a payday loan despite its transparency issues.

Regardless of which lender you choose, use your new loan as an opportunity to start rebuilding your credit. With on-time payments and responsible use of your other forms of credit, you eventually can qualify for loans with better rates and features.

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Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.

Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.

RATES (APR)loan amount
7.73% – 29.99% $1,000 to $50,000
6.26% – 14.87%1 $5,000 to $100,000
7.99% – 35.89%* $1,000 to $50,000
56.00% – 199.00%2 $500 to $4,000
5.99% – 24.99%3 $5,000 to $35,000
4.99% – 29.99%4 $10,000 to $35,000
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1 Includes AutoPay discount. Important Disclosures for SoFi.

SoFi Disclosures

  1. Personal Loans: Fixed rates from 6.990% APR to 14.865% APR (with AutoPay). Variable rates from 6.255% APR to 12.555% APR (with AutoPay). SoFi rate ranges are current as of September 1, 2018 and are subject to change without notice. Not all rates and amounts available in all states. See Personal Loan eligibility details. Not all applicants qualify for the lowest rate. If approved for a loan, to qualify for the lowest rate, you must have a responsible financial history and meet other conditions. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, years of professional experience, income and other factors. See APR examples and terms. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 6.255% APR assumes current index rate derived from the 1-month LIBOR of 2.08% plus 4.425% margin minus 0.25% AutoPay discount. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.

    To check the rates and terms you qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull.See Consumer Licenses.
  2. Minimum Credit Score: Not all applicants who meet SoFi’s minimum credit score requirements are approved for a personal loan. In addition to meeting SoFi’s minimum eligibility criteria, applicants must also meet other credit and underwriting requirements to qualify.
  3. SoFi Personal Loans are not available to residents of MS. Maximum interest rate on loans for residents of AK and WY is 9.99% APR, for residents of IL with loans over $40,000 is 8.99% APR, for residents of TX is 9.99% APR on terms greater than 5 years, for residents of CO, CT, HI, VA, SC is 11.99% APR, and for residents of ME is 12.24% APR. Personal loans not available to residents of MI who already have a student loan with SoFi. Personal Loans minimum loan amount is $5,000. Residents of AZ, MA, and NH have a minimum loan amount of $10,001. Residents of KY have a minimum loan amount of $15,001. Residents of PA have a minimum loan amount of $25,001. Variable rates not available to residents of AK, TX, VA, WY, or for residents of IL for loans greater than $40,000.
  4. Terms and Conditions Apply: SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi’s underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Financing Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (www.nmlsconsumeraccess.org)
2 Important Disclosures for Opploans.

Opploans Disclosures

Direct Deposit required for payroll.

Opploans currently operates in these states:

  1. To qualify, a borrower must (i) be a U.S. citizen or permanent resident; (ii) reside in a state where OppLoans operates; (iii) have direct deposit; (iv) meet income requirements; (v) be 18 years of age (19 in Alabama); and, (vi) meet verification standards.
  2. This information is current as of October 10, 2017 and is subject to change. Opportunity Financial, LLC lends or arranges loans in the following states: Alabama, California, Delaware, Florida, Idaho, Illinois, Kansas, Maryland, Missouri, Nevada, New Mexico, Ohio, South Carolina, Tennessee, Texas, Utah, Virginia, and Wisconsin. We do not lend or arrange loans in all states. Opportunity Financial offers line of credit products in: Kansas, Tennessee and Virginia. Please note: This is an expensive form of credit. This service is not intended to provide a solution for longer-term credit or other financial needs. Loans made or arranged by Opportunity Financial are designed to help you meet your short-term borrowing needs. Loan amounts may vary and are dependent upon qualification criteria and state law. Refer to Loan Cost & Terms at www.opploans.com for additional details. Complete disclosures of APR, fees and payment terms are provided within the transaction documents, such as the Loan Agreement. First-time Opportunity Financial customers typically qualify for an installment loan of $1,000 to $5,000 with an APR from 59% to 199%. For example, a $1,000 loan made or arranged by Opportunity Financial with 12 bi-weekly payments of $130 has a 199% APR. After the 12th successful payment, the loan would be paid in full.
  3. Applications processed and approved before 7:30 p.m. ET Monday-Friday are typically funded the next business day. In some cases, we may not be able to verify your application information and may ask you to provide certain documents. Some customers applying for a loan may be required to submit additional documentation due to state law and qualification criteria.
  4. Lower APRs and longer terms when compared to a typical payday lending product. According to the Consumer Federation of America, a non-profit consumer advocacy group, payday loans range in size from $100 to $1,000, depending on state legal maximums and carry an average APR of 400% and an average loan term of two weeks. The maximum APR for a loan offered by OppLoans is 199% and loan sizes range from $1,000-$5,000 with a typical term of six months dependent on the state law.
  5. As of October 17, 2017. Ratings on third-party websites may periodically change; please check the third-party websites for up-to-date reviews and ratings. Google+ Rating: 4.8 out of 5 based on 1,824 reviews. Facebook Rating: 4.7 out of 5 based on 270 reviews.
3 Includes AutoPay discount. Important Disclosures for Payoff.

Payoff Disclosures

  1. All loans are subject to credit review and approval. Your actual rate depends upon credit score, loan amount, loan term, credit usage and history. Currently loans are not offered in: MA, MS, NE, NV, OH, and WV.
4 Important Disclosures for FreedomPlus.

FreedomPlus Disclosures

  1. All loans available through FreedomPlus.com are made by Cross River Bank, a New Jersey State Chartered Commercial Bank, Member FDIC, Equal Housing Lender. All loan and rate terms are subject to eligibility restrictions, application review, credit score, loan amount, loan term, lender approval, and credit usage and history. Eligibility for a loan is not guaranteed. Loans are not available to residents of all states – please call a FreedomPlus representative for further details. The following limitations, in addition to others, shall apply: FreedomPlus does not arrange loans in: (i) Arizona under $10,500; (ii) Massachusetts under $6,500, (iii) Ohio under $5,500, and (iv) Georgia under $3,500. Repayment periods range from 24 to 60 months. The range of APRs on loans made available through FreedomPlus is 4.99% to a maximum of 29.99%. APR. The APR calculation includes all applicable fees, including the loan origination fee. For Example, a four year $20,000 loan with an interest rate of 15.49% and corresponding APR of 18.34% would have an estimated monthly payment of $561.60 and a total cost payable of $7,948.13. To qualify for a 4.99% APR loan, a borrower will need excellent credit on a loan of $15,000 with a term of 24 months, and qualify for at least two of the following discounts: (1) add a co-borrower who has sufficient income; (2) use at least fifty percent of the loan proceeds to directly pay off existing debt; or (3) show proof of having at least forty-thousand dollars in retirement savings – contact FreedomPlus for further details.
* Important Disclosures for Upgrade Bank.

Upgrade Bank Disclosures

* Your loan terms are not guaranteed and are subject to our verification and review process. You may be asked to provide additional documents to enable us to verify your income and your identity. This rate includes an Autopay APR reduction of 0.5%. By enrolling in Autopay your payments will be automatically deducted from you bank account. Selecting Autopay is optional. Annual Percentage Rate is inclusive of a loan origination fee, which is deducted from the loan proceeds. Late payments or subsequent charges and fees may increase the cost of your fixed rate loan. All loans made by WebBank, member FDIC. Please refer to Upgrade’s Terms of Use and Borrower Agreement for all terms, conditions and requirements.

** Accept your loan offer and your funds will be sent to your bank via ACH within one (1) business day of clearing necessary verifications. Availability of the funds is dependent on how quickly your bank processes this transaction. From the time of approval, funds should be available within four (4) business days.