Bad credit loan rates are affected by the overall interest rate environment, including economic factors such as inflation. They’re also influenced by your credit history, income, employment record, and outstanding debts.
To determine what your personal loan rate might be if you have bad credit, you can prequalify online. Prequalifying won’t affect your credit score and is only an estimate of the rates and terms you might receive. If you move ahead with a formal application, lenders usually perform a hard credit inquiry, which could temporarily drop your credit score by a few points.
A FICO score below 580 is generally considered a bad credit score. Here are average interest rates selected by borrowers with FICO scores below 580 who prequalified on the Credible marketplace in May 2025:
Average personal loan interest rates ranged from 13.93% APR to 18.71% APR for borrowers with FICO scores of 720 or higher. If you have bad credit (a FICO score below 580) and can get approved for a personal loan, you might expect an APR near or above 30%. With good credit, your APR could be closer to the 15%-20% range. Nationally, the average FICO score is 715.
The chart below shows average interest rates over the past three years for borrowers with credit scores of 720 or higher.
A bad credit loan is a type of installment loan, which means you pay back the borrowed amount in regular installments, usually monthly. Both the payments and interest rate are typically fixed, which means they stay the same every month.
Personal loans typically use annual percentage rates (APRs), which account for both interest rates and upfront lender fees, to measure the cost of borrowing. Personal loan APRs can range from 6.49% to 35.99%.
Bad credit loans tend to have higher APRs, in some cases 30% or more, because lenders view borrowers with bad credit as more of a risk. On the other hand, lenders may consider certain factors that could lower your APR, such as:
You usually have multiple options for repayment terms. Depending on the lender and the loan you choose, terms could vary from around two to seven years, with some lenders offering longer terms for specific loan purposes like home improvement.
The amount you can borrow with a bad credit loan typically ranges from $1,000 to $50,000. You might even be able to borrow up to $100,000 or more with certain lenders. If you have bad credit, some of the factors that could lower your APR (including income, collateral, and co-signed or joint loans) could also increase the amount you can borrow.
Many lenders charge origination fees to cover the cost of underwriting personal loans, and these fees tend to be higher for bad credit loans. Origination fees are typically deducted upfront from your loan proceeds and can range as high as 12%. Some lenders also charge fees for late payments, returned checks and insufficient funds (not reflected in the APR).
The time it takes to get your loan funds varies from lender to lender. Some lenders can deposit your money the same day you’re approved, while others can take several business days.
Related: How Do Personal Loans Work?
Here are some important factors to consider when you're deciding between lenders or multiple loan options from the same lender.
What are some common APRs and loan purposes for borrowers with bad credit? Here are the average rates on closed loans on the Credible personal loan marketplace for borrowers with FICO scores of less than 580 from April 2024 to March 2025, along with some of the most common loan purposes:
Read More: What Are Personal Loans Used For?
Unfortunately, there are predatory lenders out there who try to take advantage of people with bad credit by promising quick funding and no-credit-check loans. However, many legitimate lenders may also offer these things.
To avoid a bad credit loan scam, look out for lenders that:
Learn More: How to Check If a Personal Loan Company Is Legitimate
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Disclosure: Some lending partners that participate in Credible’s comparison marketplace offer loans to borrowers with scores as low as 550. Borrowers with low scores will have fewer lending options than borrowers with higher credit scores.