Sarah Li-Cain is a personal finance journalist with more six years of experience. Her work has been featured by CNN, Bankrate, USA TODAY Blueprint, Business Insider, CNBC Select, and Forbes.
Lauren Graves is a writer and editor specializing in service journalism, educational content, and digital marketing within the personal finance space.
Updated October 4, 2024
Editorial disclosure: Our goal is to give you the tools and confidence you need to improve your finances. Although we receive compensation from our partner lenders, whom we will always identify, all opinions are our own. Credible Operations, Inc. NMLS # 1681276, is referred to here as “Credible.”
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Whether you need to renovate your home, pay off high-interest debt, or make a large purchase, a personal loan can help. If you have bad credit, it can be hard to qualify to borrow money, but it is possible. In fact, average overall debt has increased significantly for bad-credit borrowers in the past few years. According to a study by Experian, consumers with FICO credit scores between 300 and 579 (defined as bad credit) had $43,584 in total average debt in 2023, compared to $36,159 in 2022 and $33,375 in 2021.
The overall best bad-credit personal loans come from Universal Credit because the lender requires a minimum credit score of 560, does not specify income requirements, and offers loans in 49 states. The following lenders may consider applicants with FICO scores below 580, offer secured loans, and/or let you apply with a cosigner. Just be prepared to pay higher interest rates and origination fees than someone with a good credit score.
Prosper is the only remaining true P2P marketplace in the peer-to-peer lending space that connects borrowers with individual investors for some loans. If you apply for a loan with Prosper, the funding may come from an individual who has chosen to invest in you.
Prosper offers personal loans between $2,000 and $50,000 with terms between 2 and 5 years, and funding as soon as one business day. You can use a personal loan through Prosper for a variety of purposes, including debt consolidation and home improvement. The platform has excellent customer service reviews on Trustpilot, as well.
Loan amount
$2,000 to $50,000
Fees
Origination fee
Discounts
None
Eligibility
Available in all states except IA and WV
Min. income
$15,000
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
On average, within 5 days of accepting your offer
Loan uses
Debt consolidation, home improvement, vehicles, small business, new baby expenses, and other purposes
Best Egg is a solid lender for a wide range of borrowers and, notably, scored second for personal loan satisfaction in J.D. Power's Consumer Lending Study. It offers competitive rates, reasonable loan terms and amounts, and personal loans for fair credit. You'll need a FICO score of at least 600 to qualify, but the lower your score, the higher your APR may be. The APR includes the interest rate and origination fees, which range from 0.99% to 9.99% with Best Egg.
Note that if you successfully prequalify with Best Egg, you may be more likely to be approved for the loan relative to other lenders you prequalify with. Based on Credible data, borrowers who chose to apply for a loan with Best Egg were more than twice as likely to be approved (relative to most other Credible partners).
Loan amount
$2,000 to $50,000
Fees
Origination fee, late fee, unsuccessful payment fee, check processing fee
Discounts
None
Eligibility
Available in all states except DC, IA, VT, and WV
Min. income
None
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
As soon as 1 to 3 business days after successful verification
Loan uses
Credit card refinancing, debt consolidation, home improvement, and other purposes
Avant personal loans are a good choice for borrowers with bad credit looking for small- to moderate-sized personal loans. Loans are available up to $35,000 and you could get the money as soon as the next business day after approval. Plus, Avant is more likely than some lenders to approve the applications of borrowers who've prequalified with Avant. However, the lender charges an origination fee up to 9.99%, and its top-range interest rates are among the highest of the lenders we reviewed.
Loan amount
$2,000 to $35,000**
Fees
Origination fee, late fee, dishonored payment fee
Discounts
None
Eligibility
Available in all states except HI, IA, MA, ME, NY, VT, and WV
Min. income
$1,200 monthly
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
As soon as the next business day (if approved by 4:30 p.m. CT on a weekday)
Loan uses
Debt consolidation, emergency expense, life event, home improvement, and other purposes
Universal Credit is one of a handful of lenders that offers personal loans for bad credit. If your FICO credit score is at least 560, you may be eligible for a Universal Credit personal loan. It offers loan amounts up to $50,000, repayment terms up to seven years, and discounts for direct pay and autopay. Funds are available as soon as the next business day after loan approval.
Note that rates and fees can be relatively high — you may pay an origination fee from 5.25% to 9.99%, and APRs start at 11.69%. If you get a loan with a high interest rate, consider refinancing your personal loan at a lower rate once you've improved your credit score.
Loan amount
$1,000 - $50,000
Repayment terms
3, 5, or 7 years
Fees
Origination fee
Discounts
Autopay and direct pay
Eligibility
A U.S. citizen or permanent resident; not available in DC, IA, SC, WV
Min. income
None
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
As soon as 1 business day after acceptance
Loan uses
Debt consolidation, pay off credit cards, home improvements, unexpected expenses, home and auto repairs, weddings, and other major purchases
OneMain Financial has multiple options for bad-credit personal loans. There is no minimum credit score required (if you apply directly with OneMain), which means you could get a loan with bad credit (FICO below 580). Plus, cosigners are allowed — a cosigner is someone (ideally, with good credit) who promises to repay the loan if you can't, which can make it easier to qualify or lower your rate. And, secured personal loans are available. You secure a loan with collateral, which may also help you qualify or lower your rate.
Rates are higher than competitors and OneMain charges origination fees as either a flat fee up to $500, or a percentage from 1% to 10% (depending on your state of residence). Note that even if you prequalify for a personal loan with OneMain, getting approved isn't a given.
Loan amount
$1,500 to $20,000
Fees
Origination fee, unsuccessful payment fee, late fee
Discounts
None
Eligibility
Must have photo I.D. issued by U.S. federal, state or local government
Prosper is the only remaining true P2P marketplace in the peer-to-peer lending space that connects borrowers with individual investors for some loans. If you apply for a loan with Prosper, the funding may come from an individual who has chosen to invest in you.
Prosper offers personal loans between $2,000 and $50,000 with terms between 2 and 5 years, and funding as soon as one business day. You can use a personal loan through Prosper for a variety of purposes, including debt consolidation and home improvement. The platform has excellent customer service reviews on Trustpilot, as well.
Loan amount
$2,000 to $50,000
Fees
Origination fee
Discounts
None
Eligibility
Available in all states except IA and WV
Min. income
$15,000
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
On average, within 5 days of accepting your offer
Loan uses
Debt consolidation, home improvement, vehicles, small business, new baby expenses, and other purposes
Best Egg is a solid lender for a wide range of borrowers and, notably, scored second for personal loan satisfaction in J.D. Power's Consumer Lending Study. It offers competitive rates, reasonable loan terms and amounts, and personal loans for fair credit. You'll need a FICO score of at least 600 to qualify, but the lower your score, the higher your APR may be. The APR includes the interest rate and origination fees, which range from 0.99% to 9.99% with Best Egg.
Note that if you successfully prequalify with Best Egg, you may be more likely to be approved for the loan relative to other lenders you prequalify with. Based on Credible data, borrowers who chose to apply for a loan with Best Egg were more than twice as likely to be approved (relative to most other Credible partners).
Loan amount
$2,000 to $50,000
Fees
Origination fee, late fee, unsuccessful payment fee, check processing fee
Discounts
None
Eligibility
Available in all states except DC, IA, VT, and WV
Min. income
None
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
As soon as 1 to 3 business days after successful verification
Loan uses
Credit card refinancing, debt consolidation, home improvement, and other purposes
Avant personal loans are a good choice for borrowers with bad credit looking for small- to moderate-sized personal loans. Loans are available up to $35,000 and you could get the money as soon as the next business day after approval. Plus, Avant is more likely than some lenders to approve the applications of borrowers who've prequalified with Avant. However, the lender charges an origination fee up to 9.99%, and its top-range interest rates are among the highest of the lenders we reviewed.
Loan amount
$2,000 to $35,000**
Fees
Origination fee, late fee, dishonored payment fee
Discounts
None
Eligibility
Available in all states except HI, IA, MA, ME, NY, VT, and WV
Min. income
$1,200 monthly
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
As soon as the next business day (if approved by 4:30 p.m. CT on a weekday)
Loan uses
Debt consolidation, emergency expense, life event, home improvement, and other purposes
Universal Credit is one of a handful of lenders that offers personal loans for bad credit. If your FICO credit score is at least 560, you may be eligible for a Universal Credit personal loan. It offers loan amounts up to $50,000, repayment terms up to seven years, and discounts for direct pay and autopay. Funds are available as soon as the next business day after loan approval.
Note that rates and fees can be relatively high — you may pay an origination fee from 5.25% to 9.99%, and APRs start at 11.69%. If you get a loan with a high interest rate, consider refinancing your personal loan at a lower rate once you've improved your credit score.
Loan amount
$1,000 - $50,000
Repayment terms
3, 5, or 7 years
Fees
Origination fee
Discounts
Autopay and direct pay
Eligibility
A U.S. citizen or permanent resident; not available in DC, IA, SC, WV
Min. income
None
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
As soon as 1 business day after acceptance
Loan uses
Debt consolidation, pay off credit cards, home improvements, unexpected expenses, home and auto repairs, weddings, and other major purchases
OneMain Financial has multiple options for bad-credit personal loans. There is no minimum credit score required (if you apply directly with OneMain), which means you could get a loan with bad credit (FICO below 580). Plus, cosigners are allowed — a cosigner is someone (ideally, with good credit) who promises to repay the loan if you can't, which can make it easier to qualify or lower your rate. And, secured personal loans are available. You secure a loan with collateral, which may also help you qualify or lower your rate.
Rates are higher than competitors and OneMain charges origination fees as either a flat fee up to $500, or a percentage from 1% to 10% (depending on your state of residence). Note that even if you prequalify for a personal loan with OneMain, getting approved isn't a given.
Loan amount
$1,500 to $20,000
Fees
Origination fee, unsuccessful payment fee, late fee
Discounts
None
Eligibility
Must have photo I.D. issued by U.S. federal, state or local government
Before applying for a bad-credit loan, prequalify with multiple lenders. This way, you'll know which lenders you're most likely to get approved with, which could mean fewer rejections and a better loan buying experience.
Just know that prequalification is not an offer of credit and it won't hurt your score. Once you complete a full application, the lender will usually conduct a hard credit inquiry to determine your eligibility, which could temporarily ding your score by a few points.
Universal Credit is one of a handful of lenders that offers personal loans for bad credit. If your FICO credit score is at least 560, you may be eligible for a Universal Credit personal loan. It offers loan amounts up to $50,000, repayment terms up to seven years, and discounts for direct pay and autopay. Funds are available as soon as the next business day after loan approval.
Note that rates and fees can be relatively high — you may pay an origination fee from 5.25% to 9.99%, and APRs start at 11.69%. If you get a loan with a high interest rate, consider refinancing your personal loan at a lower rate once you've improved your credit score.
Loan amount
$1,000 - $50,000
Repayment terms
3, 5, or 7 years
Fees
Origination fee
Discounts
Autopay and direct pay
Eligibility
A U.S. citizen or permanent resident; not available in DC, IA, SC, WV
Min. income
None
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
As soon as 1 business day after acceptance
Loan uses
Debt consolidation, pay off credit cards, home improvements, unexpected expenses, home and auto repairs, weddings, and other major purchases
OneMain Financial has multiple options for bad-credit personal loans. There is no minimum credit score required (if you apply directly with OneMain), which means you could get a loan with bad credit (FICO below 580). Plus, cosigners are allowed — a cosigner is someone (ideally, with good credit) who promises to repay the loan if you can't, which can make it easier to qualify or lower your rate. And, secured personal loans are available. You secure a loan with collateral, which may also help you qualify or lower your rate.
Rates are higher than competitors and OneMain charges origination fees as either a flat fee up to $500, or a percentage from 1% to 10% (depending on your state of residence). Note that even if you prequalify for a personal loan with OneMain, getting approved isn't a given.
Loan amount
$1,500 to $20,000
Fees
Origination fee, unsuccessful payment fee, late fee
Discounts
None
Eligibility
Must have photo I.D. issued by U.S. federal, state or local government
Offers peer-to-peer lending (individuals can invest in personal loans)
Can fund in 1 business day
Open to borrowers with fair credit
Low minimum APR
Origination fee
Not available in Iowa or West Virginia
No discounts
More details
Overview
Prosper is the only remaining true P2P marketplace in the peer-to-peer lending space that connects borrowers with individual investors for some loans. If you apply for a loan with Prosper, the funding may come from an individual who has chosen to invest in you.
Prosper offers personal loans between $2,000 and $50,000 with terms between 2 and 5 years, and funding as soon as one business day. You can use a personal loan through Prosper for a variety of purposes, including debt consolidation and home improvement. The platform has excellent customer service reviews on Trustpilot, as well.
Loan amount
$2,000 to $50,000
Fees
Origination fee
Discounts
None
Eligibility
Available in all states except IA and WV
Min. income
$15,000
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
On average, within 5 days of accepting your offer
Loan uses
Debt consolidation, home improvement, vehicles, small business, new baby expenses, and other purposes
Scored second in J.D. Power's Consumer Lending Satisfaction Study
Funds in 1-3 business days
High close rate on loans through Credible platform
Origination fees
No discounts
Not available in DC, IA, VT, or WV
More details
Overview
Best Egg is a solid lender for a wide range of borrowers and, notably, scored second for personal loan satisfaction in J.D. Power's Consumer Lending Study. It offers competitive rates, reasonable loan terms and amounts, and personal loans for fair credit. You'll need a FICO score of at least 600 to qualify, but the lower your score, the higher your APR may be. The APR includes the interest rate and origination fees, which range from 0.99% to 9.99% with Best Egg.
Note that if you successfully prequalify with Best Egg, you may be more likely to be approved for the loan relative to other lenders you prequalify with. Based on Credible data, borrowers who chose to apply for a loan with Best Egg were more than twice as likely to be approved (relative to most other Credible partners).
Loan amount
$2,000 to $50,000
Fees
Origination fee, late fee, unsuccessful payment fee, check processing fee
Discounts
None
Eligibility
Available in all states except DC, IA, VT, and WV
Min. income
None
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
As soon as 1 to 3 business days after successful verification
Loan uses
Credit card refinancing, debt consolidation, home improvement, and other purposes
Not available in HI, WA, IA, MA, ME, NY, VT, or WV
More details
Overview
Avant personal loans are a good choice for borrowers with bad credit looking for small- to moderate-sized personal loans. Loans are available up to $35,000 and you could get the money as soon as the next business day after approval. Plus, Avant is more likely than some lenders to approve the applications of borrowers who've prequalified with Avant. However, the lender charges an origination fee up to 9.99%, and its top-range interest rates are among the highest of the lenders we reviewed.
Loan amount
$2,000 to $35,000**
Fees
Origination fee, late fee, dishonored payment fee
Discounts
None
Eligibility
Available in all states except HI, IA, MA, ME, NY, VT, and WV
Min. income
$1,200 monthly
Customer service
Phone, email
Soft credit check
Yes
Time to get funds
As soon as the next business day (if approved by 4:30 p.m. CT on a weekday)
Loan uses
Debt consolidation, emergency expense, life event, home improvement, and other purposes
Repayment terms
2 to 5 years
Methodology
Credible evaluated the best personal loan lenders for bad credit based on factors such as minimum and maximum fixed rates, minimum and maximum loan amounts, funding time, lender reputation, loan terms, customer experience, origination fees, discounts, and whether cosigners are accepted. Credible’s team of experts gathered information from each lender’s website, customer service department, directly from our partners, and via email support. Each data point was verified by a third party to make sure it was accurate and up to date. To assign star ratings, we used the following metrics and weightings:
Rates and fees: 18%
Loan terms: 18%
Customer experience: 17%
Eligibility: 14%
Customer satisfaction: 10%
Efficiency: 10%
Options for poor credit and no credit: 9%
Discounts: 4%
To select specifically the best loans for bad credit, we chose lenders that consider applicants with FICO credit scores of less than 580 or, in some cases, lenders that have higher credit score requirements than this but allow cosigners on applications or offer secured personal loans.
Credible’s team of experts gathered information from each lender’s website, customer service department, directly from our partners, and via email support. Each data point was verified by a third party to make sure it was accurate and up to date.
A personal loan is a type of installment loan with a fixed interest rate and fixed monthly payments for the term of the loan. Repayment terms vary based on the lender and loan purpose but generally range from one to seven years.
If you're approved for a loan, you’ll receive a lump sum payment to be used toward almost any purpose (which you'll specify in your application). Loan amounts are typically between $1,000 and $50,000 but may be up to $100,000.
Rates and Fees
Depending on the lender, you may pay an origination or application fee when you accept a personal loan. Origination fees can reach up to 12% of the loan amount and are usually deducted from funds upfront, reducing the amount you receive.
The APR, or annual percentage rate, of a personal loan represents how much the loan will actually cost, considering both the interest rate and upfront fees (like origination fees). APRs are much more useful for estimating total costs than interest rates alone. Some personal loan rates are as high as 35.99%.
Tip
Personal loans for bad credit may be more likely to carry origination fees or have higher fees, so it’s crucial to consider how this will impact your cost as well as available funds.
How do secured personal loans work?
Most personal loans are unsecured, meaning you aren’t required to pledge collateral to take out a loan. But if you have bad credit, it can be easier to qualify for secured personal loans.
A secured personal loan requires you to put down collateral in order to qualify, and this serves as protection for lenders in the event you can’t repay your loan.
You can secured these loans with an asset such as a vehicle, savings account, real estate, or valuable items like art or jewelry. Lenders take on less risk with secured personal loans because they have the right to seize or repossess the collateral if you default.
Lenders can send your account to collections or pursue legal action against you if you stop repaying an unsecured personal loan, but they can’t seize your property. Whether a loan is secured or unsecured, defaulting can severely damage your credit.
How to get a personal loan with bad credit
Whether or not you qualify for a personal loan — and, if you do, the personal loan rate you’re approved for — depends on your credit profile and income. More specifically, lenders typically look at the following financial factors:
Income: Many lenders have minimum income requirements. They’ll also want to see that you can afford the payment terms of the loan you’re seeking. You might need to provide proof of employment in the form of tax statements or pay stubs when applying.
Debts: Lenders consider your debt when you apply for new debt such as a personal loan, especially as it relates to your income. They want to make sure you have enough money after other debts are paid to afford repaying the loan. A debt-to-income ratio (DTI) less than 36% is ideal, though some lenders consider higher DTIs. Calculate your DTI by dividing your minimum monthly debt payments by your gross monthly income.
Credit score: Most lenders prefer borrowers with a FICO score above 670, but some will consider you if you have a FICO score as low as 550 (or lower, in some cases).
Information on your credit reports: Lenders will consider what’s in your credit report, such as whether you have delinquent accounts, late payments, public records, and/or any bankruptcies.
“I recommend checking your credit reports at least once a year, but ideally more often, to monitor your profile for suspicious activity. You can get free copies of your reports from each of the three major credit bureaus — Experian, Equifax, and TransUnion — at AnnualCreditReport.com. The contents of your reports can be wrong, so scan them carefully for errors like double-reported accounts, incorrect balances, or credit you didn’t open. If you find anything wrong, open a dispute with the reporting bureau right away.” — Lauren Graves, Editor, Personal Loans
If you have bad credit, it’s still possible to get a personal loan, though your options are more limited compared to someone with good credit. Some strategies include:
Apply with a cosigner: A cosigner is someone who agrees to be responsible for your loan if you don't or can’t pay it back. In most cases, this person has good credit — lenders can pursue repayment from your cosigner if you default, so they want to be confident in this person's ability to cover your debt.
Look for lenders with low minimum credit score requirements: You can increase your chances of getting a personal loan if you work with a lender who is willing to work with those who have lower credit scores.
Apply for a secured loan: If you’re willing to put up collateral or an asset to take out a loan, consider applying for a secured personal loan. Lenders may be willing to grant you a loan with poor or limited credit because having collateral lowers their risk.
How to get approved for a loan with bad credit
Even if you have bad credit, there are ways you can increase your odds of approval. Some best practices include:
Lower your DTI: Your DTI is the percentage of your gross income you use toward debt. The higher your DTI, the more it appears you need to rely on debt, increasing your risk as a borrower.
Raise your credit score: If you can wait to take out a personal loan, increasing your credit score can improve your odds. Make a point to consistently pay debts on time, don’t take on more debt, and check your credit report for errors and progress. You might also want to consider services like Experian Boost that claim to raise your score by reporting payments like rent and utilities to the bureaus — for a fee.
Seek a lower loan amount: The more lenders lend to a borrower, the higher of a risk it tends to be for them. Lowering the amount could lower their risk and help you get your loan application approved.
Tip
Avoid predatory short-term loans such as payday loans that target borrowers with bad credit at all costs. These are risky because they can have fees that equate to APRs over 400% and often have terms of less than a month, making them hard to repay.
How to apply for a loan with bad credit
Once you’re ready to take out a personal loan, use the following steps to guide you:
Shop around: Find reputable lenders willing to work with bad-credit borrowers (like the ones listed above). Then, prequalify before you formally apply. Most personal loan lenders let you prequalify — with no impact to your credit — directly on their site. This gives you a sense of what you can qualify for and which lenders offer the best terms.
Compare loans and lenders: Once you’ve prequalified, compare loan terms and APRs between lenders to find which best suits your needs. Personal loans typically won’t charge more than 35.99% APR. Also consider lender fees, such as origination and late fees, as well as available discounts, such as autopay and direct deposit.
Complete and submit application form: Apply for a personal loan on a lender’s website or via a personal loan marketplace and fill out the required information, including your name, contact details, Social Security number (often only the last four digits are required), desired loan amount, and loan purpose. At this point the lender will run a hard credit check, which tends to slightly drop your credit score temporarily. You may be required to provide additional documentation such as pay stubs, bank statements, or other proof of income. If you’re getting a secured loan, you may need to submit documentation that proves how much your collateral is worth.
Sign closing documents: If your application is approved, the lender will ask you to sign closing documents once you review your role and responsibilities as a borrower. You will also need to tell the lender where to send the loan proceeds. This may be your bank account, or could be directly to your creditors if you’re getting a debt consolidation loan.
The best types of loans for bad credit are those from lenders with flexible credit score requirements, as well as secured personal loans. Since most debt carries some risk, take the time to consider the advantages and disadvantages of loans from different lenders before making a decision.
You can apply for loans for bad credit online or in person at credit unions and banks. It’s best to prequalify with multiple online lenders first to get a sense of what lenders are willing to offer you, and compare. Remember that prequalification does not impact your credit.
You may be able to get a fast loan with bad credit if you apply with a cosigner who has a good credit profile. Not all lenders accept cosigners. Otherwise, lenders may more readily approve your application if you’re willing to put down collateral for a secured loan.
A payday alternative loan (PAL) is a type of personal loan offered by some credit unions as an alternative option to expensive payday loans. Loan amounts typically range from $200 to $1,000, loan terms are from one to six months and APRs are capped at 28%.
Sarah Li-Cain is a personal finance journalist with more six years of experience. Her work has been featured by CNN, Bankrate, USA TODAY Blueprint, Business Insider, CNBC Select, and Forbes.