3 Personal Loan Lenders You Won’t Scare Off with Fair Credit

personal loans for fair credit

Searching for a personal loan for fair credit can feel like trying to find a prom date after getting head gear. Even though you’re working on improving yourself, it’ll be a while before you’re the perfect dance partner.

But here’s the good news: Some lenders are willing to let you borrow money with not-so-perfect credit. And finding them doesn’t have to come with the same drama as high school dating.

Find out what to expect when it comes to getting a personal loan with fair credit as well as three of the best options out there today.

How does fair credit affect personal loan qualifications?

Different lenders and credit bureaus have different thresholds, but here are the general ranges for credit score ratings:

  • Poor credit: 629 and below
  • Fair credit: 630 to 689
  • Good credit: 690 to 719
  • Excellent credit: 720 and above

If your credit score is in the 600s, you probably have fair credit — also referred to as average credit. Average credit puts you on the border between good and bad credit, where you won’t always meet a lender’s eligibility requirements.

But that’s OK. You might not be able to qualify for any loan you want, but with some research, you’ll find lenders with flexible standards that might be a good fit.

Personal loans for fair credit often cost more

Although some lenders will approve borrowers with fair credit, the best personal loan rates are reserved for people with excellent credit (720 to 850). Meanwhile, getting a personal loan with fair credit can lead to higher interest rates compared to borrowers with excellent credit.

Advertised rates start around 5.00% to 6.00%, for example, but most borrowers’ rates will be higher on personal loans for fair credit. The average personal loan rate is 10.13%, according to the Federal Reserve Bank. With fair credit, your personal loan rate will probably be close to that rate or a little higher.

Your rate also will vary based on your lender’s guidelines and other financial factors, such as your income and monthly cash flow. On top of higher interest rates, origination fees of around 1 to 6 percent are commonly charged on personal loans for fair credit.

The bottom line: You might pay a little more for a personal loan for fair credit, but you can get approved.

3 best personal loans for fair credit

Of course, not every lender is willing to accept applicants with fair credit. Each lender has its own credit and eligibility requirements.

To get a personal loan for fair credit, you’ll need to know where to look. We did some of the legwork for you and found three personal loans that require a minimum FICO score well within the “fair credit” range.

1. Avant: 580 FICO minimum

Avant has flexible personal loan requirements and considers applicants with a credit score as low as 580. Additionally, Avant has no set income requirements for its personal loans.

Personal loan amounts range from $2,000 to $35,000. Loan terms of two, three, four, and five years are available. Avant does charge an origination fee 4.75% of the loan balance.

Visit Avant

2. LendingClub: 600 FICO minimum

A peer-to-peer lending platform, LendingClub pools funds from individual investors to offer personal loans. The minimum required FICO score is just 600, and there are no set income requirements.

With a LendingClub loan, you can borrow $1,000 to $40,000. Loan terms of three and five years are offered. Make sure you plan for the LendingClub origination fee, however, which will be between 1 and 6 percent of the loan.

Visit LendingClub

3. Upstart: 620 FICO minimum

Upstart welcomes applications from borrowers with a credit score as low as 620. Borrowers with an annual income of at least $12,000 are eligible.

Upstart personal loans allow you to borrow $1,000 to $50,000 and offer terms of three and five years. The lender will assess an origination fee of 1 to 6 percent.

Visit Upstart

How to shop around for personal loans with fair credit

If you have fair credit, you’ll pay a little more for a personal loan than borrowers with good or excellent credit. But you still should put in the time to find the best deal you can. Follow these tips to identify the best personal loan for fair credit.

1. Know your credit score

First, you want to make sure you know what your credit score and history look like. That way, you can be sure you’re looking at the right lenders.

You also should know how lenders might view other factors in your personal finances, such as:

  • Credit report and payment history: They form your overall track record of borrowing behavior.
  • Income: This is how much money you have coming in that you can use to repay the loan. Lenders also might consider your employment history, career field, or educational attainment.
  • Cash flow: This is the money going out. It might be measured by your debt-to-income ratio or by looking at your fixed housing costs, such as your rent or mortgage. Lenders will want to make sure you’ll have enough leftover each month to reasonably keep up with payments.

Lenders will gather these details through the underwriting process once you apply. They’ll use them to create an overall picture of your financial resources and behavior and estimate how likely you are to repay the personal loan.

2. Review different lenders

The three lenders above are a good starting point for your personal loan search. But other lenders provide personal loans for fair credit too. Take some time to perform a comprehensive search for a personal loan.

Check with different types of lenders, from online personal loans for fair credit to major banks and local credit unions. Each lender will have its own perks and drawbacks. For example, you’ll likely find low interest rates with online lenders, better repayment terms with major banks, and more flexible repayment options with credit unions.

3. Get and compare personal loan rate quotes

Once you have a few top picks, request a rate quote from the lender. Make sure it uses a soft credit check to avoid dinging your credit.

The lender can give you a custom rate estimate for a personal loan, which might include different loan term offers and should outline other costs, such as an origination fee. Comparing these personalized rates quotes will point you to the personal loan that is the best deal.

If you need to borrow some cash for an urgent expense or to consolidate debt, a personal loan for fair credit is a viable option. Shopping around is a smart way to find lenders that will approve your application, even with fair credit — and offer decent loan terms.

Interested in a personal loan?

Here are the top personal loan lenders of 2018!
LenderRates (APR)Loan Amount 
1 Includes AutoPay discount. Important Disclosures for SoFi.

SoFi Disclosures

  1. 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 Finance Lender Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (www.nmlsconsumeraccess.org)
  2. Personal Loans: Fixed rates from 5.49% APR to 14.24% APR (with AutoPay). Variable rates from 5.29% APR to 11.44% APR (with AutoPay). SoFi rate ranges are current as of December 1, 2017 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. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 5.29% APR assumes current 1-month LIBOR rate of 1.34% plus 4.20% 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.

2 Important Disclosures for Citizens Bank.

Citizens Bank Disclosures

  1. Personal Loan Rate Disclosure: Fixed interest rates range from 5.99% – 16.24% (5.99% – 16.24% APR) based on applicable terms and presence of a co-applicant. Lowest rates shown are for eligible applicants, require a 3-year repayment term, and include our Loyalty and Automatic Payment discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.
  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 Benefit: 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.
7.39% - 29.99%$1,000 - $50,000Visit Upstart
5.29% - 14.24%1$5,000 - $100,000Visit SoFi
8.00% - 25.00%$5,000 - $35,000Visit Payoff
5.99% - 16.24%2$5,000 - $50,000Visit Citizens
5.99% - 35.89%$1,000 - $40,000Visit LendingClub
5.25% - 14.24%$2,000 - $50,000Visit Earnest
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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.