Best personal loans for bad credit
OneMain Financial is a company that offers unsecured and secured personal loans up to $20,000. These loans come with high rates, but could be a decent option if you have poor credit. Once approved, funds can be deposited into your account as quickly as the next business day.
OneMain Financial pros and cons
Best bad credit personal loans
OneMain Financial
3.9
Credible Rating
Est. APR
18.00 - 35.99%
Loan Amount
$1500 to $20000
Min. Credit Score
540
Pros and cons
More details
Pros
- Fast funding: After you sign your loan agreement, OneMain Financial may deposit funds into your account as soon as the next business day.
- Accessible to borrowers with poor credit: Although OneMain doesn’t disclose its minimum credit score requirement, many of its approved applicants have credit scores of 619 or lower, according to its most recent 10-K filing with the Securities and Exchange Commission (SEC).
- Offers secured personal loans: OneMain offers secured personal loans, meaning you can attach collateral like a car to your loan. Doing this may help you qualify for a higher loan amount or lower rate, though the lender can take your collateral if you default on the loan.
- Cosigners allowed: OneMain lets you apply with a cosigner (usually someone with a good credit history), which can increase your chance of getting a loan if you have poor credit.
Cons
- High APRs: OneMain’s advertised annual percentage rate (APR) range is 18% to 35.99%, which is higher than most other personal loan lenders we reviewed.
- Settlement with CFPB for deceptive marketing practices: OneMain Financial has been ordered by the CFPB to pay $10 million in penalties and $10 million in refunds to customers the company deceived. The CFPB found that OneMain tricked consumers into purchasing unnecessary add-ons and didn’t reimburse them for interest accrued on these products during the full-refund cancellation period.
- Not available in all states: OneMain doesn’t operate in six states — Alaska, Arkansas, Connecticut, Massachusetts, Rhode Island, and Vermont — or Washington, D.C.
- Origination fees: OneMain charges an origination fee up to 10% of the loan amount or a flat fee up to $500, depending on your state.
OneMain Financial loan details
OneMain Financial standout features
OneMain Financial’s personal loan offerings come with a few perks, such as:
- Cosigners allowed: OneMain Financial allows you to apply for a loan with a cosigner — someone who agrees to share responsibility for the loan but does not have access to borrowed funds. A potential benefit of applying with a co-borrower is that it can help you qualify for more favorable loan terms, like a higher loan amount or lower APR.
- Ability to cancel the loan: If you decide you no longer want the loan, OneMain allows you to cancel it up to 7 days after you’ve signed the loan agreement.
- Flexible repayment terms: OneMain offers loan terms ranging from 2 to 5 years, which allows you to choose a repayment option that best fits your budget.
Related: Co-applicant vs. Cosigner
What to consider before applying for a OneMain Financial personal loan
While deciding whether OneMain Financial is a good fit, consider these factors.
- High origination fees: OneMain Financial charges an origination fee on all of its loans, which ranges from 1% to 10%, depending on what state you live in. This fee is deducted from your loan amount — for example, if you’re approved to borrow $10,000 and your origination fee is 10%, you’ll only be able to borrow $9,000. Some lenders don’t charge origination fees.
- CFPB settlement: The CFPB found that OneMain deceived customers with its full-refund policy, and ordered the company to pay $20 million in refunds and penalties. It might be worth finding a lender with a less blemished record of customer care.
Check Out: Best Personal Loans With No Origination Fee
How to qualify for a personal loan from OneMain Financial
OneMain Financial doesn’t list minimum requirements on its website. But when you apply, it’ll evaluate your application based on these general factors.
- Your credit history
- Your financial history
- Whether you live in one of the states it operates in
- Your debt-to-income ratio (DTI)
- Loan purpose
Related: Personal Loan Requirements
How to get a personal loan with OneMain Financial
If you believe OneMain Financial is your best option, follow these steps to apply.
- Prequalify: Preview estimated rates and terms you might receive by clicking the “check for offers” button on OneMain Financial’s homepage. Afterward, complete the prequalification app, which has no impact on your credit.
- Submit requested documentation: If you prequalify and want to move forward, you’ll need to provide documents that support your application, such as your most recent tax returns or pay stubs, government-issued ID, and proof of address.
- Sign loan agreement: After you’ve accepted the loan offer, OneMain Financial will send you a loan agreement. Review this agreement carefully before signing.
- Repay loan: Once you receive your funds, repay the loan on time to avoid late fees and possible damage to your credit.
Check Out: How Long Does It Take To Get a Personal Loan?
How to contact OneMain Financial
You can contact OneMain Financial’s customer support team by phone Monday through Friday from 7 a.m. to 7 p.m. or by email at [email protected]. Plus, you can speak to a representative in person if you live close to one of OneMain’s physical branches.
How OneMain Financial compares to other lenders
Here’s how OneMain compares to other lenders that specialize in serving borrowers with fair credit.
Credible rating
Credible rating
Credible rating
FAQ
What types of personal loans does OneMain Financial offer?
OneMain offers unsecured and secured personal loans. You may qualify for a lower interest rate or higher loan amount with a secured loan, but keep in mind you risk losing your collateral if you default. You can use OneMain personal loan funds for just about anything except gambling, illegal activities, investing, business, and post-secondary education expenses.
Related: Secured vs. Unsecured Loans
How does a OneMain Financial personal loan affect my credit?
You can prequalify with OneMain Financial with a soft credit check, which won’t hurt your credit score. But once you apply, the company performs a hard credit inquiry, which may temporarily lower your credit score. You can improve or maintain your credit score by making timely payments on the loan. But if you make late payments or default, it can cause significant damage to your credit.
Learn More: Does Paying Off a Loan Help Your Credit Score?
Can I repay a personal loan from OneMain Financial early?
You can repay your loan early without penalty — OneMain doesn’t charge a prepayment penalty. If you decide you don’t want the loan within the first seven days (and haven’t spent the money), you can return the money and cancel the loan.
Methodology
Credible evaluated the best personal loan lenders based on factors such as customer experience, minimum fixed rate, maximum loan amount, funding time, loan terms, and fees. Credible’s team of experts gathered information from each lender’s website, customer service department, and via email support. Each data point was verified to make sure it was up to date.
Related Articles:
