Best Loans for Bad Credit in October 2026

• Average APR: 29.85%
• Average credit score: 562
• Average loan amount: $7,942

If you have bad credit (a FICO score below 580) and can get approved for a personal loan, you can expect an APR near or above 30%. With good credit, your APR could be closer to the 15% to 20% range. 

Use the calculator below to get a sense of how much your monthly loan payment and total interest cost could be. If you have bad credit, input a rate of 30% or more. If the payment is too high, try extending the loan term to lower it. Just keep in mind that most lenders cap repayment terms at five or seven years. 

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. Averages are for borrowers with FICO scores below 580 who got a personal loan on the Credible marketplace from October 2025 through September 2026. Data is based on 461 closed loans.

Borrowers with credit scores below 580 took out $3.66 million in personal loans through Credible over the past 12 months. Most loans were used to consolidate debt, refinance credit cards, pay bills or rent, make a major purchase, or finance home improvements.

The following lenders have minimum credit scores of 580 or lower. However, keep in mind that your credit score isn't the only factor that lenders consider in your loan application. Other factors typically include income, employment status, and your overall credit profile.

Here are average rates for closed loans by loan purpose on the Credible personal loan marketplace for borrowers with FICO scores below 580 over the past 12 months. Data is based on 426 closed loans. The most common loan purposes and their average rates were:

1. Debt consolidation: 29.60%
2. Credit card refinancing: 30.08%
3. Bills or rent: 30.61%
4. Major purchase: 28.51%
5. Home improvement: 29.57%
6. Special occasion: 30.72%
7. Medical expenses: 30.01%
8. Car repair: 29.33%
9. Moving: 30.52%
10. Vacation: 30.48%
11. Car financing: 28.04%
12. Wedding: 28.25%
13. Taxes: 27.82%

Read More: What Are Personal Loans Used For?

There are many types of bad credit loans, including payday advances via cash apps, payday loans, title loans, pawnshop loans, and some personal loans. Personal loans are typically the most affordable, by a wide margin. They also tend to have the lowest payments and give you the longest time to repay. Plus, they can improve your credit score if managed well. 

Below, we show you what to compare when choosing a personal loan for bad credit. But you can generally apply the following to any type of loan.

1. Your total cost (interest rate + fees)

The annual percentage rate (APR) represents the cost of your loan, accounting for the interest rate and upfront fees. Bad credit personal loans usually carry APRs over 30% but top out at 36%. While high relative to loans for borrowers with better credit, APRs are much lower than those of short-term loans. (Cash apps and payday loans can have APRs well over 100%.)  

But it’s important to be aware of how upfront fees — called origination fees — will impact your loan. Depending on the lender and your financial profile, origination fees can be up to 15% of the loan amount. In many cases, this fee is deducted from your loan funds, meaning you would receive less than the amount you borrow. For instance, if you need to finance a $5,000 purchase but your loan has a 10% origination fee that’s deducted upfront, you’d receive only $4,500 but still have to repay $5,000 plus interest.

Other fees include late payment fees and returned payment or insufficient fund fees.

When comparing loans: The best loan is often the loan with the lowest APR.

2. Your monthly payment 

Your monthly payment depends on the rate you’re approved for and the amount you borrow. As noted, the lower your credit score, the higher your APR. However, the repayment term you choose can also tweak your rate — longer terms tend to have higher APRs, while shorter terms can have lower ones. Repayment terms typically range from two to five years. 

• Longer terms = lower monthly payments, but more total interest
• Shorter terms = higher monthly payments, but less total interest

When comparing loans: Focus on a monthly payment you can afford for the duration of the loan’s repayment term, and only borrow what you need. 

3. Funding speed

Funding timelines vary by lender — from same-day, next-business-day, or several business days. If you’re using the loan to consolidate debt, it could take a few additional days for the money to reach your creditors, especially if you’re having the lender send it directly to them.

When comparing loans: If your timeline matters, prioritize lenders that clearly disclose fast funding options or emergency loans.

4. Loan amounts

The amount you can borrow with a bad credit loan typically ranges from a few hundred dollars to $10,000 or more, depending on the type of loan and the lender. Some of the factors that could lower your APR on a personal loan (including income, collateral, and using a cosigner or a co-borrower) could also increase the loan amount you qualify for.

When comparing loans: Most lenders advertise their minimum and maximum loan amounts, so look for a lender that matches up with how much you need to borrow. Keep in mind that with bad credit, you're less likely to qualify for higher loan amounts from a bank, credit union, or online lender.

5. Lender reputation and perks

Beyond the numbers, consider the lender itself. Start by checking out the lender's website. 

• Is there a thorough FAQ section (frequently asked questions)? 
• Can you easily find which fees are charged, how much, and under what circumstances, along with the lender’s APR range? 
• Is there a grace period for late payments? 
• Can you change your payment due date? 
• Does the lender offer rate discounts for things like setting up automatic payments?

Next, look at customer reviews on third-party websites. A reputable lender with clear terms and positive customer experiences may be worth choosing over a lender with a slightly lower rate but less transparency and poor customer feedback.

When comparing loans: Look for transparency and fee disclosures, positive customer reviews (Trustpilot, the Better Business Bureau, Google Reviews), and available discounts (such as autopay and direct-pay discounts).

Not qualifying for a personal loan doesn't necessarily mean you're out of options. If you're using a personal loans marketplace like Credible, you may be offered recommendations for: 

• Specialty bad-credit lenders, also called emergency lenders (these may have APRs higher than 36%)
• Debt relief products (such as debt settlement companies that offer to negotiate down your current debt). 

It’s a good idea to also explore alternatives on your own, including credit counseling or borrowing money from friends or family.

While it's good not to get discouraged, it's also good to be realistic. If you're having trouble qualifying for a personal loan, it may be an opportunity to consider the current state of your credit and ask yourself:

• Can I afford to borrow money right now?
• Am I looking to borrow money because I need something or because I want something?
• Should I work on improving my credit score and try again later?

If you're interested in taking another run at a personal loan after you've improved your credit score, see the tips in the section How to improve your chances of approval below.

When you're trying to get a personal loan with the goal of paying off existing debt, bad credit can make it difficult to qualify for a new loan. If you have trouble qualifying, you can try other options to address your debt head-on instead of borrowing money. Keep in mind that these alternatives have advantages and disadvantages, so consider carefully.

Debt settlement

Debt settlement involves using a third-party company or service to negotiate with your creditors on your behalf. This process means trying to reduce the amount of debt you owe, not erase it. Success isn't guaranteed, and the process can wreak havoc on your credit. This is because companies typically require that you skip payments to your creditors and send money their way instead to deposit into a dedicated savings account. This account is then used as leverage with your creditors to settle your debt. Debt settlement companies typically charge fees for their services, and the process can take up to three or four years.

If you're at the stage where you're still current on your debt payments but afraid of falling behind, a debt settlement company is probably not the right choice for you. Missed payments can damage your credit score and could lead to lawsuits or wage garnishment (your creditors taking a portion of your paycheck).

Read More: Debt Settlement Pros and Cons

Debt management plans

A debt management plan, or DMP, is a less drastic alternative to debt settlement (and a better option if you have fair or better credit). A credit counselor negotiates with your creditors — to reduce fees and APRs— and develops a plan to gradually reduce your debt. A DMP could result in a lower interest rate and smaller monthly payments.

A DMP typically involves some fees and could take a long time to carry out — up to five years. You also need to be careful about choosing a credit counselor. The ideal choice is a nonprofit agency. Some companies that advertise debt management plans might actually be in the business of providing a different product or service, including debt settlement and debt consolidation loans. Be sure you understand the product you’re signing up for, the timespan it will take to see debt relief, and the costs (including to your credit).

Unfortunately, there are predatory lenders out there who try to take advantage of people with bad credit. To avoid a bad credit loan scam, look out for lenders that:

• Request a fee in advance: A lender that asks for a processing fee or application fee before you apply or are approved is a scam. This is different from an origination fee, which is taken from the amount you borrow, not from your bank account.
• Ask for payment using methods that can’t be traced: Never agree to make loan payments in cash or by wire, as those methods have no paper trail that can be traced. The same goes for requests to send payment via courier. 
• Guarantee you’ll be approved no matter what: A lender that promises to loan money to you is not reputable.
• Promise “insurance” on a loan: Loans don’t require insurance, though they may be an option for some types of loans. If a lender requires money for insurance on a loan, that’s a sign of a scam.
• Ask for your bank login information: A lender doesn’t need login credentials for your bank account. That’s a sign a criminal is about to clear out your savings.

Learn More: 8 Signs of a Personal Loan Scam

If you're not confident you have the qualifications to get a personal loan, or you've tried before and been denied, you can take steps to put yourself in a better position. Here's a list of some things you can do to improve your credit:

Tactics that may help right away

1. Check your credit report for errors and dispute any you find

• When it may help: In the short term
• How it helps: Unlike your credit score, your credit report is a history of how you've used credit and managed your finances. Unfortunately, credit reports sometimes have incorrect or outdated information that could make you seem more risky to a lender, such as incorrect account balances or inaccurate late payments. Correcting errors could improve your credit score and help lenders have an accurate representation of your financial history. 
• What to do: Get free copies of your credit reports from all three major credit bureaus at AnnualCreditReport.com. Check each report for inaccuracies — for example, a debt you've already repaid but is still listed as outstanding. If you see anything that looks incorrect, follow the Consumer Financial Protection Bureau's step-by-step guide on how to dispute information on your credit report.

2. Apply with a co-borrower or cosigner

• When it may help: Immediately
• How it helps: When you apply for a loan with another person, the lender considers their credit history, income, and current debt along with yours. If your co-borrower or cosigner has better credit than you do or a lower debt-to-income ratio (DTI), the lender may feel more comfortable offering a loan. Just know that your co-applicant will be legally on the hook for payments and the account will go on their credit report. Be sure you can comfortably afford to make payments to keep both of your credit reports and your relationship in good shape. 
• What to do: Find a lender that offers joint loans or cosigned loans, like Upgrade or OneMain Financial. A joint loan means you and your co-borrower have equal access to the loan funds and share responsibility for repayment. You might get a joint loan with your spouse or partner, for example. A cosigned loan is when someone else vouches for you but doesn't have access to the money. More lenders offer joint loans than cosigned loans.

3. Get a secured loan

• When it may help: Immediately
• How it helps: Most personal loans are unsecured — which means you don’t need to tie a valuable asset to the loan to qualify  — but some lenders offer secured loans. Depending on the lender and the type of collateral the lender accepts, you could pledge your car, a savings account, or even the fixtures in your home against the loan. If you default, the lender could seize whatever asset you pledge. This reduces the risk a lender takes in lending you money, which can make it easier for you to get a loan. However, you could lose the asset if you miss payments.
• What to do: Find a lender that offers secured loans, such as Upgrade, Reprise, and OneMain Financial. Some credit unions and small banks may offer loans secured by your savings account or a CD. Make sure you can afford payments for the duration of the loan — you could lose your property if you can’t.

4. Include all your income

• When it may help: Immediately
• How it helps: Lenders consider your income to determine how much of a monthly payment you can feasibly afford — which affects the amount you qualify to borrow and whether you qualify at all. The more income you have, the bigger a monthly payment you can afford. 
• What to do: Ask lenders which types of income they consider when reviewing your application, especially if you primarily earn money from non-W-2 employment — for instance, some lenders may consider rental income as a primary income source. Include annual bonuses, side income, rental income, and any other regular income you can show proof of when you apply.

5. Become an authorized user 

• When it may help: Within 30 days to long-term gains
• How it helps: The amount of credit you have available on revolving accounts, like credit cards, contributes to your credit utilization ratio, which in turn can have a big impact on your credit score (up to 30%). Increasing your available credit can increase your score. 
• What to do: Become an authorized user on the card of someone you trust with good credit habits (they maintain low balances and make timely payments), such as a parent, partner, or close friend. If the card issuer reports authorized user data to the credit bureaus (most do), the primary user's available credit and payment activity will show up on your credit report. Don't use the card yourself. Using it could have a negative impact on the primary cardholder’s and your credit score.

6. Use the loan to consolidate debt

• When it may help: Immediately
• How it helps: Lenders may be more willing to offer a loan if you’re not taking on new debt. A debt consolidation loan is used to pay off one or more of your current debts with the goal of lower monthly payments and possibly interest rates. In turn, this can free up monthly cash flow to use toward other expenses or help you pay debt off faster. Using an installment loan (like a personal loan) to pay off credit cards has the added advantage of decreasing your credit utilization, which could significantly increase your score — as long as you keep the cards open and don’t run up a balance.
• What to do: Add up your existing debts and look at your total monthly payment and lowest interest rate. Prequalify with bad credit lenders to see if you might be able to get a lower interest rate or lower monthly payment. Make sure you can afford the new payment for the duration of the loan term before proceeding with an application.

Bonus tip: Use our calculator for credit card consolidation to see if you’ll end up paying more or less interest with a debt consolidation loan. If you can lower your monthly payment, the extra interest might be an acceptable compromise, especially if you’re struggling to make payments now. But if you’re not struggling with payments, saving on interest and paying off debt sooner is generally the better route. 

Tactics that may help over time

1. Make credit payments on time

• When it may help: Months to 1 year +
• How it helps: Your payment history is the most important factor in your FICO score — it accounts for 35% of your overall score. If you make payments on time every month, you can gradually improve your credit score. If your record of making on-time payments is inconsistent, the opposite can happen. The types of credit accounts typically reported to the credit bureaus include credit cards, retail accounts (such as department store cards), installment loans (personal and auto loans, mortgages), and BNPL.
• What to do: Make all payments on time. One way to reduce the risk of late payments is to set up auto-pay on your accounts. 

Good to know: FICO has created new scoring models that incorporate BNPL accounts and payments. The main purpose is to deliver a clear picture of total debt and payment history for lenders and others that use credit reports in their decision-making — BNPL data hasn’t traditionally shown up on credit reports. Lenders are still in the early stages of adopting the new scoring models, although some services, like Affirm, are already reporting new plans to the credit bureaus. 

2. Apply for a secured credit card

• When it may help: Within a few months to a year +
• How it helps: Secured credit cards are designed for people with low credit scores or limited credit history — in other words, they tend to be easier to qualify for. Used responsibly, a secured credit card that reports to one or more of the credit bureaus can help build your credit over time. It can also provide a convenient alternative to paying cash.
• What to do: Find a company offering secured credit cards and apply to find out how much of a deposit you’ll be asked to put down. Use the card for regular small purchases (perhaps a monthly subscription). And pay off the balance in full each month before the due date. 

How it works: Secured credit cards work a little differently than regular non-secured cards — your initial credit line is typically limited to an initial security deposit. Then, you’d use the card just as you would an unsecured credit card (which includes making your payments on time). The deposit is typically refunded when you upgrade to an unsecured card or close the account.

Read more tips in How To Build Your Credit: A Step-by-Step Guide.

If you don’t qualify for a personal loan, you have several other options to consider, but some are much better than others. We break them down by “recommended” to “avoid if possible.” We do not recommend payday loans or title loans under any circumstances.

Recommended

• Small bank loans: Some banks, including Bank of America and U.S. Bank, offer small-dollar loans to existing customers, often with flat fees instead of interest. Loan amounts are usually limited to less than $1,000, repaid in three equal monthly installments. However, you may have to be a bank customer for a certain amount of time to qualify — 6 months or 1 year in some cases — so it's not a good option for non-customers in an emergency.
• Payday alternative loans (PALs): PALs are offered by some federal credit unions, with rates capped at 28% APR. Loan amounts may be available up to $2,000 or $1,000, depending on the type of PAL, with repayment terms up to 1 year or 6 months. Credit union membership is required, but you may be eligible immediately after joining.

Use with caution

• Buy now, pay later (BNPL): BNPL services, such as Klarna, Affirm, and Afterpay, let you split up payments rather than paying the entire cost upfront. Short-term plans may be interest-free with no credit check required, but you may pay financing fees and late fees. 

Avoid if possible

• Loan apps: Loan apps, such as EarnIn and Dave, offer quick funding without a credit check. However, repayment is often due in days — out of your next paycheck — and you may have to pay subscription fees, expedited funding fees, or other charges that can send APRs well over 100%. Unless you have a small one-time need, cash apps are best avoided. 
• 401(k) loans: If you have money in a 401(k) account, you may be able to borrow from it to use for whatever you need. Since it’s your money, there’s no credit check, and many plans allow loans. But borrowing from your retirement account comes with risks. If you don’t pay the money back, you could owe income tax and a 10% penalty on the unpaid balance. And the amount you borrow is not invested during the loan’s term, which means you could miss out on investment gains. Importantly, if you think bankruptcy is in your future, avoid this route or talk to an attorney before getting a 401(k) loan. Retirement accounts are typically protected during bankruptcy.
• Pawnshop loans: A pawnshop loan is a non-recourse loan, which means the lender can’t come after you if you don’t pay it back. They just keep the item you put up as collateral. While we don’t recommend pawnshop loans, they can be a better choice than payday or title loans. If you don’t repay a payday loan or title loan, you could be subject to collection calls and credit damage — and with a title loan, the lender could repossess your car. 

Non-loan alternatives

• Negotiating debt directly: You may be able to negotiate with your credit card company or with a debt collector. However, negotiation isn't a "get out of debt free" card. For example, your credit card issuer might agree to lower your rate or accept a lump-sum payment lower than the amount you currently owe, but you will most likely have to pay at least something. Plus, a settled account can have a large negative impact on your credit score for years.
• Debt management plans (DMPs): A DMP isn’t a new loan, but a way to better manage and reduce the cost of your current debts. You’ll need to work with a certified credit counselor to set it up. Fees are typically modest, but you’re required to close all credit cards you enroll in the plan.

Credible evaluated 32 lenders across 1,184 data points to choose the best lender overall plus top picks for different borrowers and use cases. Across lenders, we collected data on customer experience and service options, minimum and maximum fixed interest rates, minimum and maximum loan amounts, funding times, loan terms, fees, discounts, third-party reviews, and more.

We assigned a score to each attribute based on how that feature compared with the same feature for every other lender in the set. Scores were weighted according to their relative importance — for instance, maximum origination fee scores received a high weight since loan cost is among the most important factors in determining loan value. Individual attribute scores were then added to determine each lender's overall star rating. 

Attributes were grouped into categories; each category contributed to lender scores as follows: 

• Borrower cost (22.5%): Origination fee ranges and minimum and maximum APRs measure upfront and overall costs and lender accessibility across credit score groups.
• Flexibility (22.5%): Maximum loan terms, number of loan purposes, minimum and maximum loan amounts, and availability of joint and secured loans measure the range of options for loan size, repayment terms, and loan types.
• Eligibility and availability (22.5%): Minimum income requirements, funding speed, minimum credit score requirements, and state availability measure how easily and how quickly borrowers can access personal loans.
• Reputation (15%): Trustpilot, Better Business Bureau, and J.D. Power ratings measure customer satisfaction.
• Discounts, customer service, and account management (12.5%): Discounts for autopay and direct pay, plus availability of mobile apps and live customer support chat, measure borrower perks and ease of loan management.
• Partner lender data (5%): Data from loans closed by our partners, including average rates, loan amounts, funding time, and eligibility criteria, measure real-world performance and borrower outcomes.

Non-partner lenders were evaluated based on the same criteria but not assigned star ratings. Learn more about how Credible rates lenders by exploring our full personal loans lender rating methodology.

Where we get our data

Credible is a personal loans marketplace that partners directly with lenders to offer loans for a wide range of credit profiles and loan purposes. Because of these relationships, we have access to the most current interest rates that real borrowers are being approved for, along with average rates by credit score and loan purpose, approval rates overall and by lender, and more. Lender-specific data is based on 12 months of loans closed by that lender on the Credible marketplace. Lenders may also provide product and eligibility insights that we share in reviews. The data we use is primary source data and does not include any personally identifiable information about borrowers.