How to Get a Personal Loan With Bad Credit

 April 28, 2020
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When you have bad credit and need a loan, you might have a hard time finding one with favorable terms. You’ll generally need a score above 600 to get approved for an unsecured personal loan.

However, there are certain lenders that specialize in loans for borrowers with bad credit. And you might want to consider the alternatives, like secured personal loans and cosigned loans, before you open an unsecured loan for bad credit.

Personal loans for borrowers with bad credit

Personal loans can help you consolidate debt and reclaim control of your finances. Unfortunately, borrowers with a poor credit history might have a harder time qualifying for an unsecured personal loan. However, your first step should be to get know what kinds of terms lenders offer. You can do that by checking out our table below.

See personalized loan offers

How Student Loan Hero Gets Paid

How Student Loan Hero Gets Paid

Student Loan Hero is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). Student Loan Hero does not include all lenders, savings products, or loan options available in the marketplace.

Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Student Loan Hero is an advertising-supported comparison service. The site features products from our partners as well as institutions which are not advertising partners. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.

How Student Loan Hero Gets Paid

How Student Loan Hero Gets Paid

Student Loan Hero is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). Student Loan Hero does not include all lenders, savings products, or loan options available in the marketplace.

Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Student Loan Hero is an advertising-supported comparison service. The site features products from our partners as well as institutions which are not advertising partners. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.

RATES (APR)loan amount
4.37% – 35.99% $1,000 to $50,000
7.46% – 35.97% $1,000 to $50,000
8.30% – 36.00% $1,000 to $40,000
9.95% – 35.99% $2,000 to $35,000
compare rates on Lendingtree now
NMLS #1136: Terms & Conditions Apply

What to do if you need a personal loan for bad credit

Consider the pros and cons of a bad credit loan

Borrowers with poor credit are likely to see high interest rates and high fees depending on the loans they qualify for. But there may be times where a bad credit loan may be your best financial option. For example, if the loan can help you cover a car repair so you can continue to work, it may be worthwhile in the long run.

Despite this, you need to carefully consider your cost of borrowing. If you choose a loan that is unaffordable, you could fall into a cycle of debt. This is especially a risk with payday loans, which have repayment periods of a few weeks on top of sky-high fees. For bad credit borrowers, a secured loan, which requires collateral like your car, can be one way to access more affordable loan terms.

Pros Cons
  • Many lenders to choose from: There’s no shortage of bad credit lenders to research. Take time to find the most affordable option for you.
  • Repay your debt over months or years: Depending on the lender, you can repay your debt over a long period of time.
  • Improve your credit: If you make payments on time and in full, you could boost your credit score.
  • High borrowing cost: Bad credit means high interest rates and fees, if you qualify at all.
  • Can trap you in debt: Beware taking out a loan you can’t reliably repay.
  • Predatory lending: Bad credit lenders may charge exorbitantly high fees. Take care when researching lenders.
  • Collateral may be required: Some lenders may only extend a secured loan. Collateral lowers the lender’s risk. Fall behind on payments, and you can lose the collateral.

Get quotes from lenders

Don’t apply for a personal loan from the first lender you find. Shop around to see which lender may offer you your best possible APR for your situation. Call up lenders or visit their websites to see if you can get prequalified with a soft credit check, which won’t affect your credit.

A prequalification isn’t a guarantee that you’ll get the personal loan once you formally apply. However, it can reveal what kind of terms you may qualify for. This is a great way to compare lenders beyond reviewing their fee structure and APR ranges.

To kickstart your search, here are a few lenders that accept bad or fair credit borrowers:

  • Avant
  • OneMain Financial
  • LendingPoint
  • Peerform
  • Upgrade
  • Upstart

Beware payday lenders

There’s really no such thing as a bad credit loan with guaranteed approval, but there is such a thing as predatory lending. Some lenders will offer you a high-interest loan while holding your paycheck as collateral. If you miss your payment, the lender could garnish your wages.

Financial institutions that practice this kind of lending are common, so look out for these signs of predatory lending:

  • Excessively long or short repayment terms
  • APRs of nearly 400% on payday loans
  • Unspecified APR or loan length
  • “No credit check” advertisements

Applying for a personal loan

Whether you’re applying to consolidate debt, pay for a major expense or cover another need, the application process for a personal loan is pretty much the same, and it isn’t labor-intensive.

Here’s how to get a personal loan:

  1. Check your credit report. Make sure there are no errors, and address any mistakes that you find. Equifax, TransUnion and Experian are required to provide you with a free credit report every 12 months through
  2. Know your credit score. Once you have a copy of your credit report, you’ll have a clear idea of your potential as a borrower. Knowing your score will further help you determine whether you’re likely to prequalify with certain lenders.
  3. Determine how much money you need to borrow. Make sure you nail down just the right amount. If you take out a loan that’s bigger than you need, then you could end up paying interest on funds you didn’t use.
  4. Get prequalified. This involves sending your information – income, debts, assets and credit score – to lenders, which will then determine if you may qualify. If it’s a good fit, the lender will send you a quote with an estimated APR and loan amount.
  5. Compare offers, and accept one. When you find the offer that’s best for your needs, then you’re ready to receive your money. Finalizing the loan requires a hard credit check, which will have an effect on your score.

While a lender is finalizing your loan, they may also ask for supporting documentation such as a driver’s license, proof of income and proof of residence.

Can’t get a personal loan? Consider these options

Start by building your credit

If you can’t get the terms you’d prefer on a personal loan, work on building your credit so you can reapply as a more favorable borrower. Here are steps on how to build your credit so you may be able to qualify for better terms on a personal loan:

  1. Request a copy of your credit report, and address any big issues you find.
  2. Open a secured credit card or loan. Make sure you spend within your means, and pay it off on time every month. You’ll build a healthy payment history, which can improve your credit.
  3. Give it time. While rebuilding your credit, it’s vital that you don’t miss any payments. You’ll also want to keep balances low and avoid opening any new accounts.

Open a secured personal loan

If you’re having a hard time qualifying for an unsecured personal loan, you could consider a secured loan that uses an asset, such as your house or savings, as collateral. These loans may be easier to qualify for or offer lower APRs, though you run the risk of repossession of assets if you default on your loan.

Enlist the help of a cosigner

If you can, ask a family member or significant other to cosign on the loan. There are a few things to consider here, since a cosigner is legally obligated to meet the terms of the loan. If you miss payments or default on the loan, both you and the cosigner will be on the hook, which means the two of you could suffer a blemish on your credit reports.

Further, a cosigned loan will be calculated in both of your debt-to-income ratios, and any assets that are put up as collateral could be repossessed and sold by the bank.

Meet with a certified credit counselor

Credit counseling is available to consumers who need help with controlling their finances. If you have debt that’s out of control or a credit score that’s too low to qualify for a loan, then you may be eligible to meet with a certified credit counselor for a free session.

A credit counselor may:

  • Go over your credit report with you
  • Advise you on budgeting and money management
  • Help you come up with a debt management plan

If you want to take a closer look at your credit score and how to improve it, credit counseling is the place to start. Visit the National Foundation for Credit Counseling website to find a credit counselor near you.

If there’s no other option, look into bankruptcy

It’s easy to get into a tough spot financially, especially if you’re starting out with bad credit and you don’t have access to the capital you need. You might consider filing for bankruptcy if:

  • You’re getting harassed by debt collectors that you can’t repay
  • You’re in danger of losing assets, such as your home
  • You’re relying on payday loans to keep up with your bills
  • Your liabilities outweigh your assets
  • You’ve tried everything to get out of debt and don’t see another way out

Filing for bankruptcy lets you hit the reset button on your finances. However, it will have a lasting negative effect on your credit score, so sit down with a bankruptcy lawyer to see if this is the best path for you.


Where can I get a loan when I have bad credit?

Some lenders offer personal loans to borrowers with less-than-stellar credit. Try lenders that offer personal loans to borrowers with bad credit. You might also consider opening up a secured personal loan or enlisting the help of a cosigner with good credit.

What is a minimum credit score for a personal loan?

There’s really no minimum credit score for a personal loan, but the lower the score, the harder it will be to qualify for a loan with favorable terms. You might be able to secure a loan with a credit score that’s less than 600, but you’ll end up paying much more money in interest than a prime borrower would for the same loan.

Can I get a personal loan with a credit score of 550?

You may be able to secure a personal loan with a credit score of 550, but you’ll be paying much more in interest than most borrowers with higher credit scores. Instead, you could consider waiting until you’ve improved your credit score, enlist the help of a cosigner or seek out a secured loan.

Can I get a loan without a credit check?

Maybe, but these loans typically come with astronomically high APRs. Traditional lenders will want to get a clear picture of your credit history, so they will require a credit check. However, there are some services which offer payday loans without conducting a hard credit inquiry. If you default on the loan, then the lender could garnish your wages.

How can I find legit online loans?

With so much misinformation on the internet, searching for a bad credit loan online can seem like a daunting task. Do your research before committing to a lender. Student Loan Hero produces personal loan lender reviews that you can trust.

Interested in a personal loan?

Here are the top personal loan lenders of 2022!
LenderAPR RangeLoan Amount 
7.99% – 23.43%1$5,000 - $100,000

Visit SoFi

4.37% – 35.99%$1,000 - $50,000

Visit Upstart

7.46% – 35.97%*$1,000 - $50,000

Visit Upgrade

99.00% – 199.00%2$500 - $4,000

Visit OppLoans

7.99% – 29.99%3$5,000 - $40,000

Visit Happy Money

7.99% – 20.88%4$5,000 - $50,000

Visit Citizens

7.99% – 35.99%5$2,000 - $36,500

Visit LendingPoint

8.30% – 36.00%6$1,000 - $40,000

Visit LendingClub

9.95% – 35.99%7$2,000 - $35,000

Visit Avant

1 Includes AutoPay discount. Important Disclosures for SoFi.

SoFi Disclosures

Fixed rates from 7.99% APR to 23.43% APR APR reflect the 0.25% autopay discount and a 0.25% direct deposit discount. SoFi rate ranges are current as of 8/22/22 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. Lowest rates reserved for the most creditworthy borrowers. 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, income, and other factors. See APR examples and terms. 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.

2 Includes AutoPay discount. Important Disclosures for Opploans.

Opploans Disclosures

Direct Deposit required for payroll.

Opploans currently operates in these states: . *Approval may take longer if additional verification documents are requested. Not all loan requests are approved. Approval and loan terms vary based on credit determination and state law. Applications processed and approved before 7:30 p.m. ET Monday-Friday are typically funded the next business day.

  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. NV Residents: The use of high-interest loans services should be used for short-term financial needs only and not as a long-term financial solution. Customers with credit difficulties should seek credit counseling before entering into any loan transaction.

  3. OppLoans performs no credit checks through the three major credit bureaus Experian, Equifax, or TransUnion. Applicants’ credit scores are provided by Clarity Services, Inc., a credit reporting agency.

  4. Based on customer service ratings on Google and Facebook. Testimonials reflect the individual’s opinion and may not be illustrative of all individual experiences with OppLoans. Check loan reviews.

  5. Rates and terms vary by state.

3 Includes AutoPay discount. Important Disclosures for Happy Money.

Happy Money 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 Citizens Bank.

Citizens Bank Disclosures

  1. Rates and offer subject to change. All accounts, loans and services subject to individual approval.
  2. Loyalty Discount: The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower has a qualifying account in existence with us at the time the borrower has submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, student loans or other personal loans owned by Citizens Bank, N.A. Please note, our checking and savings account options are only available in the following states: CT, DE, MA, MI, NH, NJ, NY, OH, PA, RI and VT. This discount will be reflected in the interest rate and Annual Percentage Rate (APR) disclosed in the Truth-In-Lending Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan, and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.
  3. Automatic Payment Discount: Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their Citizens Bank Personal Loan during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account two or more times within any 12-month period, the borrower will no longer be eligible for this discount.

5 Important Disclosures for LendingPoint.

LendingPoint Disclosures

Applications submitted on this website may be funded by one of several lenders, including: FinWise Bank, a Utah-chartered bank, Member FDIC; Coastal Community Bank, Member FDIC; Midland States Bank, Member FDIC; and LendingPoint, a licensed lender in certain states. Loan approval is not guaranteed. Actual loan offers and loan amounts, terms and annual percentage rates (“APR”) may vary based upon LendingPoint’s proprietary scoring and underwriting system’s review of your credit, financial condition, other factors, and supporting documents or information you provide. Origination or other fees from 0% to 7% may apply depending upon your state of residence. Upon final underwriting approval to fund a loan, said funds are often sent via ACH the next non-holiday business day. Loans are offered from $2,000 to $36,500, at rates ranging from 7.99% to 35.99% APR, with terms from 24 to 72 months. Minimum loan amounts apply in Georgia, $3,500; Colorado, $3,001; and Hawaii, $1,500. For a well-qualified customer, a $10,000 loan for a period of 48 months with an APR of 24.34% and origination fee of 7% will have a payment of $327.89 per month. (Actual terms and rate depend on credit history, income, and other factors.) The $15,575.04 total amount due under the loan terms provided as an example in this disclaimer includes the origination fee financed in addition to the loan amount. Customers may have the option to deduct the origination fee from the disbursed loan amount if desired. If the origination fee is added to the financed amount, interest is charged on the full principal amount. The total amount due is the total amount of the loan you will have paid after you have made all payments as scheduled.

6 Important Disclosures for LendingClub.

LendingClub Disclosures

  1. Checking your loan rate generates a soft credit inquiry on your credit report, which is visible only to you. A hard credit inquiry, which is visible to you and others, and which may affect your credit score, only appears on your credit report if and when a loan is issued to you. Your loan APR will depend upon your credit score and other key financing characteristics, including but not limited to the amount financed, loan term length, and your credit usage and history. A representative example of payment terms for a Personal Loan is as follows: a borrower receives a loan of $16,980 for a term of 36 months, with an interest rate of 13.49% and a 6.00% origination fee of $1,019, for an APR of 17.89%. In this example, the borrower will receive $15,961 and will make 36 monthly payments of $576. Loan amounts range from $1,000 to $40,000 and loan term lengths range from 24 months to 60 months. Some amounts, rates, and term lengths may be unavailable in certain states. For Personal Loans, APR ranges from 8.30% to 36.00% and origination fee ranges from 3.00% to 6.00% of the loan amount. APRs and origination fees are determined at the time of application. Lowest APR is available to borrowers with excellent credit. Advertised rates and fees are valid as of July 11, 2022 and are subject to change without notice. Loans are made by LendingClub Bank, N.A., Member FDIC, Equal Housing Lender (“LendingClub Bank”), a wholly-owned subsidiary of LendingClub Corporation, NMLS ID 167439. LendingClub Bank is not an affiliate of LendingTree, LLC which is an unrelated third party (“third party”). LendingClub Bank is not responsible for any products and services provided by this third party and may receive compensation if you visit the third party’s websites or use any of its products or services. Credit eligibility is not guaranteed. Loans are subject to credit approval and may be subject to sufficient investor commitment before they can be funded or issued. Certain information that LendingClub Bank subsequently obtains as part of the application process (including but not limited to information in your consumer report, your income, the loan amount that your request, the purpose of your loan, and qualifying debt) will be considered and could affect your ability to obtain a loan. Loan closing is contingent on accepting all required agreements and disclosures at “LendingClub” is a trademark of LendingClub Bank.

7 Important Disclosures for Avant.

Avant Disclosures

*If approved, the actual loan terms that a customer qualifies for may vary based on credit determination, state law, and other factors. Minimum loan amounts vary by state.

**Example: A $5,700 loan with an administration fee of 4.75% and an amount financed of $5,429.25, repayable in 36 monthly installments, would have an APR of 29.95% and monthly payments of $230.33.

Based on the responses from 7,302 customers in a survey of 140,258 newly funded customers, conducted from August 1, 2018 – August 1, 2019, 95.11% of customers stated that they were either extremely satisfied or satisfied with Avant. 4/5 Customers would recommend us. Avant branded credit products are issued by WebBank, member FDIC.

* Important Disclosures for Upgrade Bank.

Upgrade Bank Disclosures

Personal loans made through Upgrade feature Annual Percentage Rates (APRs) of 7.46%-35.97%. All personal loans have a 1.85% to 8.99% origination fee, which is deducted from the loan proceeds. Lowest rates require Autopay and paying off a portion of existing debt directly. Loans feature repayment terms of 24 to 84 months. For example, if you receive a $10,000 loan with a 36-month term and a 17.59% APR (which includes a 13.94% yearly interest rate and a 5% one-time origination fee), you would receive $9,500 in your account and would have a required monthly payment of $341.48. Over the life of the loan, your payments would total $12,293.46. The APR on your loan may be higher or lower and your loan offers may not have multiple term lengths available. Actual rate depends on credit score, credit usage history, loan term, and other factors. Late payments or subsequent charges and fees may increase the cost of your fixed rate loan. There is no fee or penalty for repaying a loan early.

Published in Personal Finance