Best Personal Loan Options for Low Credit Scores

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Best Personal Loan Options for Low Credit Scores | Having a low credit score can make it harder to get approved for a personal loan, but it’s not impossible. Many lenders specialize in bad credit loans, offering options with flexible requirements and reasonable interest rates.

This guide will walk you through:

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The best personal loan lenders for bad credit
How to improve your approval chances
The different types of loans available for low-credit borrowers
What to watch out for to avoid scams and high fees

If you have a credit score below 640, this article is for you!

Understanding Personal Loans for Low Credit Scores

A personal loan is a lump sum of money borrowed from a lender that you repay in fixed monthly installments over a set period. However, when your credit score is low, lenders see you as a higher risk borrower.

What Credit Score is Considered “Low” for a Personal Loan?

Excellent (720+): Best interest rates & easy approval
Good (680-719): Competitive rates & decent approval chances
Fair (640-679): Higher interest rates, but still eligible
Bad (Below 640): Harder to qualify; may need a secured loan or co-signer

Can You Get a Personal Loan with a Bad Credit Score?

Yes! Many lenders offer personal loans for bad credit, but you may face:
✔️ Higher interest rates
✔️ Lower loan amounts
✔️ More fees or stricter terms
✔️ A need for collateral or a co-signer

💡 Tip: Improving your credit score before applying can help you secure a better loan offer.

Best Personal Loans for Bad Credit with Guaranteed Approval

Finding a legit lender that works with bad credit can be challenging. Below are some of the best options available:

1. OneMain Financial

Credit Score Requirement: No minimum score required
Loan Amounts: $1,500 – $20,000
APR Range: 18% – 35.99%
Loan Term: 24 – 60 months
Pros:
- Works with borrowers with poor credit
- Offers secured loans for better rates
- In-person branch support available
Cons:
- Higher APRs than banks
- Origination fees may apply

2. Upstart

Credit Score Requirement: 300+
Loan Amounts: $1,000 – $50,000
APR Range: 6.7% – 35.99%
Loan Term: 36 or 60 months
Pros:
- Uses AI-based approval (not just credit score)
- Fast funding – within 1 business day
- No prepayment penalties
Cons:
- Origination fees of 0% – 12%
- Higher APR for low-credit borrowers

3. OppLoans

Credit Score Requirement: No minimum
Loan Amounts: $500 – $4,000
APR Range: 59% – 160%
Loan Term: 9 – 18 months
Pros:
- No credit check required
- Fast approval & same-day funding
- Flexible repayment options
Cons:
- Extremely high interest rates
- Only available in select states

4. Avant

Credit Score Requirement: 580+
Loan Amounts: $2,000 – $35,000
APR Range: 9.95% – 35.99%
Loan Term: 24 – 60 months
Pros:
- Lower APR than payday loans
- Fast online approval
- Good for credit-building
Cons:
- Origination fees apply
- High APR for lower scores

5. LendingPoint

Credit Score Requirement: 600+
Loan Amounts: $2,000 – $36,500
APR Range: 7.99% – 35.99%
Loan Term: 24 – 72 months
Pros:
- No prepayment penalty
- Quick approval & funding
- More flexible for low credit borrowers
Cons:
- Origination fee up to 6%
- Limited availability in some states

💡 Tip: Always compare lenders and read the fine print before accepting any loan offer.

How to Get a Personal Loan with No Credit Check

Some lenders offer personal loans with no credit check, but they often come with:

Higher interest rates
Shorter repayment terms
Smaller loan amounts

Best No Credit Check Loan Options

✔ OppLoans – High APR but no credit score required
✔ NetCredit – Flexible repayment, no hard credit check
✔ Possible Finance – Small loans for short-term needs

💡 Tip: No credit check loans are riskier—make sure you can afford the monthly payments.

How to Improve Your Credit Score Before Applying

If you improve your credit score, you can qualify for:
✔️ Lower interest rates
✔️ Higher loan amounts
✔️ More lender options

Easy Ways to Boost Your Credit Score

Pay bills on time – Late payments lower your score
Lower your credit card balance – Keep credit utilization below 30%
Check your credit report for errors – Dispute any inaccuracies
Avoid applying for multiple loans at once – Too many applications hurt your score

💡 Tip: If you’re struggling with bad credit, consider a secured personal loan to rebuild your score.

Fixed vs. Variable Interest Rates for Personal Loans

When applying for a loan, you’ll need to choose between fixed and variable interest rates:

✔ Fixed Rate:

Stays the same throughout the loan term
Easier to budget for monthly payments
Recommended for bad credit borrowers

✔ Variable Rate:

Fluctuates based on market rates
May start low but increase later
Riskier if interest rates go up

💡 Tip: If you have bad credit, always choose a fixed-rate loan to avoid unexpected payment increases.

How to Pay Off a Personal Loan Faster

✔ Make extra payments – Even small additional payments reduce interest
✔ Refinance at a lower rate – If your credit improves, refinance for a better deal
✔ Choose a shorter loan term – Less interest paid overall
✔ Avoid missing payments – Late fees add up fast

💡 Tip: If you’re struggling with debt, a debt consolidation loan may help lower your monthly payments.

Final Thoughts: Choosing the Right Personal Loan for Bad Credit

When selecting a personal loan with a low credit score, consider:
✔ Lender reputation – Avoid scams & payday lenders
✔ Interest rates & fees – Compare multiple options
✔ Loan terms – Shorter terms save on interest
✔ Repayment ability – Ensure monthly payments fit your budget

Even with bad credit, you still have options. By improving your financial habits and choosing the right lender, you can get a loan that works for you—not against you.