Our Recommendation
We have picked our top personal loan lenders for borrowers with bad credit. Making it easier for you to choose the right one for yourself.
- ZippyLoan
- AmOne
- LoanPioneer
- LoanUnder36
- PersonalLoanPro
But First Things First – What is a Personal Loan?
A personal loan is a type of loan which has a higher loan amount typically ranging from $500 – $100,000 which can be borrowed from a lender. This type of loan comes with a fixed interest rate that varies depending on the lender and your credit score. The higher your credit score will be, the lower its interest rate will go. Most of the time a personal loan will be an unsecured loan meaning that you won’t require any collateral to secure the funds and will be able to pay in monthly installments. There are seemingly endless things that can happen in life that will require some extra money to cover the costs; in time even personal loan has evolved, providing a much better aid and option to support.
Why is it difficult to get a personal loan with bad credit?
When a borrower looks for a personal loan, the first thing that gets checked is your credit score. Actually credit score is the main key when looking for a loan because your APR and repayment amount gets decided through your score.
If you have a bad credit, you might have committed some errors in the past that has limited your chances. One is bound to face to higher APR as compared to others.
What makes a Bad Credit Score
Your credit score can be the result of your previous financial history. Bad credit isn’t a deal-breaker if you’re looking for a loan. You can still find lending houses that will provide you with a variety of loans, but you may face issues that people with better credit don’t worry about as much.
Your credit score is compiled from your financial history, including previous loans and whether or not you paid them back on time. It also takes into consideration your credit card habits and outstanding debts. Typically, anything under 640 is considered a bad credit rating, and loans given to people in this credit range tend to have a higher APR on average.
A bad credit score can mean higher interest rates as well as shorter payment terms and you may be required to put up valuable collateral such as a car or house title to secure the loan.
The bottom line – even if you have bad credit, you can still get a loan, but there will probably be some stipulations.
How to apply for a personal loan?
When applying for a personal loan, most of the process gets completed in just three steps.
Step 1. Submit the Form: To request for the fund, you will be required to complete a questionnaire form which consists of various information like your personal information, loan amount, and SSN.
Step 2. Get Estimation: After your information is sent, a quick estimation of your rates, term and loan amount will be provided to you.
Step 3. Keep your Paperwork ready: Once you get pre-approved, you will get connect you with a lender. So, it is advisable to keep your paperwork ready which may include your driver’s license and address proof.
Interest Rate Vs APR
When a lender lends you the funds, it comes with a fixed interest rate which gets added to your funds when you return the same amount. For a simpler way, let’s have a look at the below example.
Suppose you have taken out a loan of amount $5000 with an interest rate of 8% for a year. So at the end of the year, you will be repaying, $5400.
This is how an interest rate works. A lower interest rate with stellar credit is what every borrower wants to have.
While an annual percentage rate or APR is the overall rate that gets added to your loan amount during repayment. An APR consists of fees, interest rate, points.
Generally, a variable APR ranges from 8% – 35.99%, which gets decided by the lender based on your credit score and history and sometimes borrower’s other aspect such as education, salary are taken into consideration.
How to Make Personal Loan Work For You?
Every borrower has a different reasons when taking a personal loan even when you fall under the bad credit zone. In the same way, every loan option is different from each other in some or the other way. Before you hop on the step as to how to get a personal loan with bad credit, compare your rate, loan and amount and see which works the most for yourself.
Compare your Different Bad Credit Lenders
Zippy loan is a market place which connects you with a lender based on the information provided. You can request a loan in less than 5 minutes. Zippy loan has a no bar for credit score, therefore any bad creditor can apply any time of the day. With its quick and secure access to loan, Zippy can deposit the funds as soon as the next business day.
Zippy Loan is a good choice if:
- You have less than a perfect score – Zippy loan can provide loan regardless of your credit score.
- You want a good security technology – All the information is protected with 226-bit SSL encryption technology to make sure that the data you provide remain safe.
- You want to go for its availability – You can request for a loan 24 hours a day, 7 days a week. Once you are connected with a lender, funds can be deposited as soon as next business day.
AmOne is your site if you are looking for a loan with APR as low as 4.99%. All you need to do is, fill out its simple form, and get matched to the lending partner, compare the rate and you can choose the one which fits you. The good part about AmOne is the wide range of loan amount as you can start from as low as $100.
AmOne is a good choice if:
- You want a loan for any purpose — Debt consolidation, home improvement, vacation or wedding expenses or any other reason be you can choose your personal loan.
- You want a quick turnover time –With AmOne you account can get funded in as little as one business day.
- You have less than a perfect score – AmOne can provide loan regardless of your credit score.
LoanPioneer is an online matching website which is as transparent as it can be. You could get a real-time decision which can fund your account by the next business day. There is no cost to request for a loan and once you get funded, the cash can be used for any purpose. LoanPioneer gives you a full disclosure of APR and its working.
LoanPioneer is a good choice if:
- You want a loan for any purpose — Debt consolidation, home improvement, vacation or wedding expenses or any other reason be you can choose your personal loan.
- You want a quick turnover time –Fill its simple form and only two minutes is what it takes to get your loan offer.
- You have less than a perfect score – LoanPioneer can provide loan regardless of your credit score.
If you are looking for a wide range of loan amount, loansunder36 is a good option to consider. With a large network of lenders, you can choose the amount from $100 -$35,000 as they have lenders for every credit score.
LoansUnder36 is a good choice if:
- You want a multiple repayment option – LoansUnder36 has two different options. You can choose between daily or weekly and for a longer period of 72 months.
- You want a wide range of loan amount.
- You have less than a perfect score – LoansUnder36 can provide loan regardless of your credit score.
PersonalLoanPro pairs with few of the top lender available but what separates them from the rest lending site that you can get pre-qualified without hurting your score and also get an instant result without judging your credit score. You can also save you money as PersonalLoanPro matches you with a great loan while keeping your situation in mind.
PersonalLoanPro is a good choice if:
- You want an instant result – Get pre-qualified and funds can be deposited as soon as the next business day.
- You want a quick turnover time – Fill its simple form and only two minutes is what it takes to get your loan offer.
- You have less than a perfect score – PersonalLoanPro can provide loan regardless of your credit score.
Pick a lender has one the largest network of lenders available to provide loans to potential borrowers. One of the good things about this lending site is their availability of loan amount starting from $100. A perfect pick for a bad credit borrower looking forward to a loan starting with a lower amount.
Pick a lender is a good choice if:
- You want a simple and easy process – Within two minutes you can start your loan process.
- You want a loan for any purpose – Debt consolidation, home improvement, vacation, wedding expenses or any other reason be, you can request a personal loan from Pick a Lender.
- You have less than a perfect score – Pick a lender can provide loans regardless of your credit score.
If you are looking forward to getting connected to a lender by just filling a short and simple form then BadCredit.com is the place to go. With a large network of lenders, BadCredit.com connects you with a lender even if you have less than perfect credit score.
BadCredit.com is a good choice if:
- You have less than a perfect score – BadCredit.com can provide loan regardless of your credit score.
- You want a loan for any purpose – Debt consolidation, home improvement, vacation or wedding expenses or any other reason be you can choose your personal loan.
- You need a quick loan – With a large network of lenders, you don’t have to search for multiple offers, get connected to one or more lender with its simple form.
If you want to borrow money but has a less than perfect score, look for Bad Credit Loans. Bad credit loans has more than 20 years of experience in connecting you with the lender who can lend up even if your credit score is not good. There is no fee when requesting your loan. Request for funds, get qualified and get your advance as soon as next business day.
Bad Credit Loans is a good choice if:
- You need a short loan amount – The maximum amount which can be borrowed is $500 to $5000.
- You have less than a perfect score – Bad Credit loans is dedicated towards borrowers with less than perfect credit score.
- You need a quick loan – Funds can be wired in as little as the next business day.
Money Mutual caters towards people with bad credit score, to help borrowers find a lender, willing to fund them based on your request. Fill its simple and easy online form in less than 5 minutes and get your funds wired as soon as the next business day.
Money Mutual is a good choice if:
- You want a short loan amount – The maximum amount which can be borrowed is $2500.
- You have less than a perfect score – Money Mutual can provide loans regardless of your credit score.
- You want to go for its availability – The loan is available in almost every state except New York.
With Personalloans.com you get to choose between peer to peer, installment, and bank personal loans. You get to decide the loan you want between the given range of $500 -$35,000. Submit your request through its simple and secure online form and get your funds as soon as the next business day.
PersonalLoans.com is a good choice if:
- You don’t want prepayment fee – If you are able to pay early, you won’t be charged any fee.
- You want to go for its availability – Personalloans.com is available in every state, but your loan amount will depend upon your creditworthiness, state, and lender.
- You need a quick loan – Funds can be wired in as little as next business day.
Prosper is a good option if you are looking for multiple loan options in one search. Prosper is a peer to peer lender which means that your needs are matched to the investor who is willing to fund with a turnaround time of minimum 3 days. If you want to reduce your monthly payment and pay down your loan over a long period of time, then prosper is a good shot.
Prosper is a good choice if:
- You don’t want to affect your credit report – Prosper loan does a soft pull on your credit history which doesn’t impact your credit score.
- You don’t want prepayment fee – If you are able to pay early, you won’t be charged of any fee.
- You want a quick turnover time – Prosper loan can wire the amount in as little as one business day.
OppLoans is one the few lending house who works with bad credit score, that is why you will find its APR much higher than any other personal loan’s. It also looks forward to offering help, which can increase your credit score and improve your financial situation.
Opploans is a good choice if:
- You don’t want to pay any personal loan fees – Opploans have a no origination and no prepayment fee option.
- You require a lower loan amount – The loan amount ranges from 1,000 to 4,000 perfect for bad credit borrowers who needs a lower amount personal loan.
- You need a quick turnover time – The loan amount can be wired into your account in as soon as next business day.
Understanding your Credit Score
Having less than a perfect credit score doesn’t mean the end of your journey. There are many lenders which specialize in each credit level. So, to choose the loan which will give you the maximum benefits, first understand your credit report and credit score.
If you are not sure what your credit score is try pulling you credit report (which can be done for free once a year). If there are any mistakes, have them fixed. If your credit score are not in good shape, take precautions, such as ensuring all payments are made on time and not taking out any unnecessary loans on credit.
Credit score rating Credit score range Average APR for market
| Excellent score rating |
Credit score range |
Average APR for market |
| Excellent |
720 – 850 |
10.94% |
| Good |
690 – 719 |
14.56% |
| Average |
630 – 689 |
19.84% |
| Bad |
580 – 629 |
28.64% |
| Poor |
579 and below |
Most lenders will not lend |
Discover the Options: Taking a Loan Despite Your Bad Credit
If you need to take out a personal loan as soon as possible, overriding your current bad credit, there are various lending options available to you:
These are member-owned nonprofit organizations that generally offer lower fees than banks
These take out a line of credit on your home and can put you in a tough situation if down the line you are unable to pay it back
These are peer lender websites that will let you post your need for a loan. Independent investors will then decide whether or not to lend you money after weighing the impact of your bad credit.
This is someone who will sign on a loan with you as a show of trust, promising to take responsibility in the event you can’t repay the amount
If none of these options are viable for you, remember that you can always go to your bank for a loan. Just be aware that most major credit lenders and institutions are hesitant to lend out money when you have bad credit. Choosing an alternative route may prove to be more successful in the end.
How to build a good credit score?
If there’s one thing that can stand in the way of getting approved for a loan, it’s bad credit. Building good credit should be done from the ground up. The moment you take out your first credit account, every financial move you make will become a part of your credit history. Knowing how to build a good credit score is crucial to overall financial health.
Consider getting a co-signer to sign a personal loan with you. And if your co-signer is someone with good credit score, lenders are more open for extending credits to you.
To build a good credit start using a credit card which is secured. What happens in secured credit card is that you deposit a certain amount and is allowed to spend that money only which can in turn help you build a decent score.
Because you can only spend what you put in you card
Borrow only what you can afford.A lot of people have gotten themselves into a huge pile of debt that they struggle to climb out of simply because they spend more than they can actually afford. That’s easy to do when you have a credit card in your hand and don’t have to use cash to shop. But if you’re not disciplined with your spending habits, you can easily wind up in a pile of debt.
Should You Take a Personal Loan to Pay off Your Credit Card Debt?
Having a high credit card debt can be toxic on your credit score regardless of whether you make all your monthly payments by the due date.
Taking out a personal loan to pay back the high-interest rate debt can be a meaningful option.
Having a personal loan with lower interest rate gives you a chance to pay off your credit debt leaving you enough to cover up the loan balance keeping in mind the goal is to pay the credit off rapidly or to ensure that your other bills are also paid.
Even when you had paid off your credit card debt, don’t opt for closing down the account as it can leave a negative effect on your credit history.
Also, make sure to not to fall prey to zero balance. Clearing your credit card debt doesn’t give you a reason to start building another. The main thing to learn from your past debt is to spend only as much as you can afford to pay back with ease.
Dangers to Avoid While getting a Personal Loan
Never fail to do your homework. Personal loan options are vast, every lender will have something different to offer. While choosing for a loan, check their APR rather than interest rate since it includes fees into the overall rate you are paying.
Avoid getting a wrong kind of loan. For instance, instead of getting a personal loan to consolidate your debt, you may be able to transfer your balance to one card at 0% interest for a number of months.
Taking a personal loan for education, try going for student loans which offer a much lower interest when the parents are getting a loan. For home projects, try getting a home equity loan, which often carries a lower interest rate than a personal loan.
Never fail to do your homework. Personal loan option are vast, every lender will have something different to offer. While choosing for a loan, check their APR rate rather than interest rate since it includes fees into the overall rate you are paying.
Never ignore your credit score. Your application getting rejected will have a direct impact on your credit score. Before your final submission, it is always a good idea to check your credit score. Be sure to get the numbers from all three major credit bureaus– Experian, Equifax, and TransUnion for the most accurate view of your credit score.
Alternatives to Bad Credit Loans
Applying for a secure credit card can be a way to get some quick cash at easier rates than by way of other options. Secured credit cards tend to have low limits, around $1,000 or so, but due to the typically lower interest rates and origination fees, they can be a better option if your cash needs aren’t very high.
If you have a friend or loved one with good credit you can ask them to co-sign a loan with you. However if you don’t make your payments, your co-signer will be on the hook for the payments, and their credit could suffer as a result.
With many retirement plans, you can take an interest free loan out against your plan for the first 60 days, and then pay it back into your plan. Not all retirement plans allow this, and often have as a stipulation that until you pay back the loan it won’t accrue an interest in the stock market.
In the End
A personal loan can be a great aid if you are facing a financial crunch. No matter if what problem you might face in your life, if the problem revolves around money, a personal loan might be able to shake off your trouble.
But before you apply for a loan, make sure to read their rates, term, loan amount, and their availability in your state. A personal loan is again a loan, so, apply only if you can make payments otherwise you might end up ruining your finances even more.
