What are bad credit loans?
A bad credit personal loan is for borrowers with low credit scores or thin credit histories. Bad credit loan amounts range from about $1,000 to $50,000 and annual percentage rates are capped at 36%.
Like all personal loans, bad credit loans have fixed rates and are repaid in fixed monthly installments over a period of one to seven years. These loans typically aren’t backed by collateral — they're unsecured.
» LEARN MORE: What credit score do you need to get a personal loan?
From the writer: How I made this list
"To build this list, I asked myself ‘which lenders would I recommend to a friend?’ The answer was those with the right mix of approachable borrowing requirements, high star ratings, the ability to fund a loan quickly and low enough minimum APRs that folks have a chance at getting a good rate.
Then, I considered what else a person seeking a bad-credit loan may need. That’s why there are lenders here that offer features like credit-building help, secured loan options and perks for consolidating debt. The goal is to have a versatile list of lenders that could fit many different borrower needs."
— Annie Millerbernd, Assistant Assigning Editor, Personal Loans
Personal loans for bad credit: Pros and cons
A bad-credit loan can help you get through an emergency, consolidate other high-interest debt or make necessary home repairs, but consumers with poor credit frequently get the highest personal loan APRs and fees.
Pros
Fast funding.
Fixed, predictable payments.
On-time loan payments build credit.
Rates may be lower than credit cards and other high-interest loans.
Cons
Rates are often high.
Consumers with the lowest credit scores may not qualify.
Collateral or a co-signer may be required.
Predatory lenders may seek out bad-credit borrowers.
How to compare bad credit loans
Qualification requirements and cost are the most important features to consider when choosing a personal loan for bad credit. Here are some tips to compare personal loans for bad credit.
Borrowing requirements. Bad-credit lenders consider many factors on a loan application, including credit score, debt-to-income ratio, and whether you’re applying with a co-applicant or collateral.
» MORE: Personal loan borrowing requirements
Annual percentage rate range. Consumers who qualify with bad credit are likely to get a rate near the top of a lender’s range, so it’s a good idea to pay attention to that number. A loan’s APR consists of the interest rate plus any fees.
Legitimacy. Read online reviews from other borrowers, verify the lender’s state license and physical address to ensure the lender is providing fair, legal loans.
Monthly payments. Review your budget to determine what an affordable monthly payment would be. Then, use a personal loan calculator to see what rate and repayment term you’d need to get that monthly payment.
Loan details
2024
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Your loan estimate
Monthly payment
$212.47
Total principal
$10,000
Total interest payments
$2,748.23
Total loan payments
$12,748.23
Payoff date
06 / 2029
Show amortization schedule
2024
Jan
Feb
Mar
Apr
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| Payment date | Principal | Interest | Monthly payment | Principal balance |
|---|---|---|---|---|
| Jun 2024 | $129.14 | $83.33 | $212.47 | $9,870.86 |
| Jul 2024 | $130.21 | $82.26 | $212.47 | $9,740.65 |
| Aug 2024 | $131.30 | $81.17 | $212.47 | $9,609.35 |
| Sep 2024 | $132.39 | $80.08 | $212.47 | $9,476.96 |
| Oct 2024 | $133.50 | $78.97 | $212.47 | $9,343.46 |
| Nov 2024 | $134.61 | $77.86 | $212.47 | $9,208.85 |
| Dec 2024 | $135.73 | $76.74 | $212.47 | $9,073.12 |
| Jan 2025 | $136.86 | $75.61 | $212.47 | $8,936.26 |
| Feb 2025 | $138.00 | $74.47 | $212.47 | $8,798.26 |
| Mar 2025 | $139.15 | $73.32 | $212.47 | $8,659.11 |
| Apr 2025 | $140.31 | $72.16 | $212.47 | $8,518.80 |
| May 2025 | $141.48 | $70.99 | $212.47 | $8,377.32 |
| Jun 2025 | $142.66 | $69.81 | $212.47 | $8,234.66 |
| Jul 2025 | $143.85 | $68.62 | $212.47 | $8,090.81 |
| Aug 2025 | $145.05 | $67.42 | $212.47 | $7,945.76 |
| Sep 2025 | $146.26 | $66.21 | $212.47 | $7,799.51 |
| Oct 2025 | $147.47 | $65.00 | $212.47 | $7,652.03 |
| Nov 2025 | $148.70 | $63.77 | $212.47 | $7,503.33 |
| Dec 2025 | $149.94 | $62.53 | $212.47 | $7,353.39 |
| Jan 2026 | $151.19 | $61.28 | $212.47 | $7,202.20 |
| Feb 2026 | $152.45 | $60.02 | $212.47 | $7,049.74 |
| Mar 2026 | $153.72 | $58.75 | $212.47 | $6,896.02 |
| Apr 2026 | $155.00 | $57.47 | $212.47 | $6,741.02 |
| May 2026 | $156.30 | $56.18 | $212.47 | $6,584.72 |
| Jun 2026 | $157.60 | $54.87 | $212.47 | $6,427.12 |
| Jul 2026 | $158.91 | $53.56 | $212.47 | $6,268.21 |
| Aug 2026 | $160.24 | $52.24 | $212.47 | $6,107.98 |
| Sep 2026 | $161.57 | $50.90 | $212.47 | $5,946.41 |
| Oct 2026 | $162.92 | $49.55 | $212.47 | $5,783.49 |
| Nov 2026 | $164.27 | $48.20 | $212.47 | $5,619.22 |
| Dec 2026 | $165.64 | $46.83 | $212.47 | $5,453.57 |
| Jan 2027 | $167.02 | $45.45 | $212.47 | $5,286.55 |
| Feb 2027 | $168.42 | $44.05 | $212.47 | $5,118.13 |
| Mar 2027 | $169.82 | $42.65 | $212.47 | $4,948.31 |
| Apr 2027 | $171.23 | $41.24 | $212.47 | $4,777.08 |
| May 2027 | $172.66 | $39.81 | $212.47 | $4,604.42 |
| Jun 2027 | $174.10 | $38.37 | $212.47 | $4,430.32 |
| Jul 2027 | $175.55 | $36.92 | $212.47 | $4,254.76 |
| Aug 2027 | $177.01 | $35.46 | $212.47 | $4,077.75 |
| Sep 2027 | $178.49 | $33.98 | $212.47 | $3,899.26 |
| Oct 2027 | $179.98 | $32.49 | $212.47 | $3,719.28 |
| Nov 2027 | $181.48 | $30.99 | $212.47 | $3,537.81 |
| Dec 2027 | $182.99 | $29.48 | $212.47 | $3,354.82 |
| Jan 2028 | $184.51 | $27.96 | $212.47 | $3,170.31 |
| Feb 2028 | $186.05 | $26.42 | $212.47 | $2,984.25 |
| Mar 2028 | $187.60 | $24.87 | $212.47 | $2,796.65 |
| Apr 2028 | $189.17 | $23.31 | $212.47 | $2,607.49 |
| May 2028 | $190.74 | $21.73 | $212.47 | $2,416.75 |
| Jun 2028 | $192.33 | $20.14 | $212.47 | $2,224.42 |
| Jul 2028 | $193.93 | $18.54 | $212.47 | $2,030.48 |
| Aug 2028 | $195.55 | $16.92 | $212.47 | $1,834.93 |
| Sep 2028 | $197.18 | $15.29 | $212.47 | $1,637.75 |
| Oct 2028 | $198.82 | $13.65 | $212.47 | $1,438.93 |
| Nov 2028 | $200.48 | $11.99 | $212.47 | $1,238.45 |
| Dec 2028 | $202.15 | $10.32 | $212.47 | $1,036.30 |
| Jan 2029 | $203.83 | $8.64 | $212.47 | $832.47 |
| Feb 2029 | $205.53 | $6.94 | $212.47 | $626.93 |
| Mar 2029 | $207.25 | $5.22 | $212.47 | $419.69 |
| Apr 2029 | $208.97 | $3.50 | $212.47 | $210.71 |
| May 2029 | $210.71 | $1.76 | $212.47 | $0.00 |
See if you pre-qualify for a personal loan – without affecting your credit score
Just answer a few questions to get personalized rate estimates from multiple lenders.
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Frequently asked questions about bad credit loans
What is the best loan company for bad credit?
Our picks for the best personal loans for bad credit are from these loan companies:
Upgrade: Best overall bad credit loan.
Upstart: Best for thin credit.
Universal Credit: Best for credit-building tools.
Avant: Best for low credit scores.
Best Egg: Best for secured loans.
LendingPoint: Best for an easy application process.
What's the easiest way to get a loan with bad credit?
First, build your credit by fixing errors or catching up on late payments. Consider adding a co-signer with good credit, or securing your loan. It's always a good idea to pre-qualify to check the rate and loan amount you might get. Pre-qualifying does not affect your credit score. Learn all the steps to get a personal loan with bad credit.
How can I borrow money quickly with bad credit?
A bad credit score may not prevent you from getting a loan. Lenders like those listed here provide personal loans for borrowers with bad credit, however, you may not qualify if your score is below 500. In that case, alternatives to bad credit loans include family loans, payment plans with medical and utility providers, local financial assistance programs, cash advance apps and buy now, pay later plans.
Can I get a loan with no credit check?
Yes, but it may be risky. A no-credit-check lender provides a loan without reviewing your credit history. Instead, these lenders consider information like your bank account transactions, income and employment status. Because these lenders don’t conduct a credit check, making loans is riskier for them and they make up for that risk by charging sky-high interest rates. All of the lenders listed on this page check credit.
How much can I borrow with bad credit?
Bad credit loans are generally from $1,000 to $50,000. Your loan amount depends on your credit, income, outstanding debts, the lender you choose and the type of loan you get.
What is bad credit?
Bad credit is reflected in a credit score that’s typically below 630, but lenders and credit scoring companies use different ranges to signal bad credit. The FICO credit scoring considers a score below 580 poor, while VantageScore calls a score of 600 or lower “subprime.”
How does bad credit affect your ability to get a personal loan?
Having a bad credit score makes it harder to qualify for a personal loan. If a lender sees that you’ve missed payments toward credit cards and other types of loans, or that you’re using a lot of your available credit, it may signal to them that adding to your debt with a personal loan could be risky for them.
What are current bad credit loan rates?
The average pre-qualified personal loan rate for a bad-credit borrower was 21.93% in April 2024, according to aggregate, anonymized data from NerdWallet.
Personal loan interest rate tracker
Borrower credit rating | Score range | Estimated APR |
Excellent | 720-850. | 11.85%. |
Good | 690-719. | 14.12%. |
Fair | 630-689. | 18.05%. |
Bad | 300-629. | 22.68%. |
Source: Average rates are based on aggregate, anonymized offer data from users who pre-qualified through NerdWallet from May 1, 2024, through May 31, 2024. Rates are estimates only and not specific to any lender. The lowest credit scores — usually below 500 — are unlikely to qualify. Information in this table applies only to lenders with maximum APRs below 36%.
What fees do bad-credit lenders charge?
One of the most common bad credit loan fees is an origination fee, which is 1% to 10% of the loan amount. The fee is included in your APR, but a lender may take it before sending you the funds, effectively reducing your loan amount, or add it to your monthly payment.
A two-year, $10,000 loan with a 20% interest rate and a 5% origination fee has an APR of 25.14%. If the lender takes the origination fee before sending you the loan, you’d receive $9,500 and the lender would keep $500.
Lenders also usually charge late payment and non-sufficient funds fees.
How to get a personal loan for bad credit
Here are the steps to get a bad credit personal loan:
1. Check your credit
Fixing errors on your report before applying may improve your chances of qualifying. You can get your credit reports for free on NerdWallet or at AnnualCreditReport.com.
2. Review your budget
Check your monthly income and expenses to see what you can comfortably afford to pay toward a personal loan each month.
3. Pre-qualify with multiple lenders
Many lenders let you pre-qualify online to preview potential loan rates, amounts, repayment terms and monthly payments. Pre-qualification involves a soft credit pull that doesn’t affect your score.
» MORE: How to pre-qualify for a personal loan
4. Submit an application
Once you’ve found the right lender, gather documents, including proof of income and employment, a government-issued ID and bank statements. Most lenders have online personal loan applications, but your local bank or credit union may require an in-person application. The lender will do a hard credit check when you apply, causing your score to temporarily drop. Expect a decision within a few days.
5. Add the new loan payment to your budget
On-time loan payments can build your credit. Add loan payments to your monthly budget and set up autopay to avoid missing any.
» MORE: How to manage personal loan payments
Other tips to qualify for a bad credit loan
Include all your income. Showing a lender that you have enough income to make the payments is crucial to approval, so be sure to include all sources of income when you apply.
Include all your income. Showing a lender that you have enough income to make the payments is crucial to approval, so be sure to include all sources of income when you apply.
Where to get a personal loan for bad credit
Online: Some online lenders offer personal loans specifically for bad-credit borrowers. These lenders may consider information beyond your credit and income to qualify you, though those are still major factors in a loan decision.
Credit unions: Credit unions rely more on traditional information like credit and income but may also consider your history as a member. A member in good standing with the credit union may qualify for a personal loan despite a low credit score.
» MORE: Credit union loans offer low rates, flexible terms
Types of bad credit loans
Unsecured personal loan
An unsecured loan doesn’t require collateral. Instead, a lender determines whether you qualify based on factors like your credit score, income and cash flow.
When to use an unsecured loan:
To make large purchases, debt consolidation and home improvement projects.
If you get a low rate.
Secured personal loan
A secured loan requires you to pledge collateral — usually a vehicle or bank account — to borrow money.
When to use a secured loan:
The rate is lower than with an unsecured loan.
Pledging collateral is worth the risk.
Co-signed personal loan
A co-signed loan requires someone to vouch for your ability to repay the loan.
When to use a co-signed loan:
The rate is lower than without the co-signer.
The co-signer understands the risk.
Joint personal loan
A joint loan is one you get with another person, meaning they share responsibility for payments and can access the funds.
When to use a joint loan:
You get a lower rate than without a co-borrower.
You and the co-borrower need equal access to the funds.
Home equity financing for bad credit
Home equity loans and credit lines allow you to borrow money against the equity in your home. Because they’re secured by your home, you risk losing your house if you default.
When to use a HELOC or home equity loan:
For home improvement projects and repairs.
You have enough equity to borrow against.
Alternatives to personal loans for bad credit
A personal loan may not be the right option if you have bad credit. Even if you’re approved, you’ll likely pay a high APR. Consider these alternatives before borrowing.
Family loan
Label
Borrow from a trusted friend or family member. It may help to have a plan for interest, repayment terms and payment frequency in mind when you ask for the loan. Then you and the lender can formalize the details in a family loan agreement.
Payment plan for bills
If you’re struggling to cover rent, utilities or credit card payments, consider asking for an extension or getting on a hardship program. Your credit card issuer, mortgage lender or utility company’s website may have an online application for hardship assistance, but you may have to ask a landlord directly.
Local financial assistance programs
For help meeting basic needs, consider a local food pantry, religious organization or nonprofit. Some organizations can provide food, clothing or bus tickets. NerdWallet’s database of local financial assistance programs lists resources in each state.
Medical bill assistance
Medical bill negotiators, medical credit cards or a payment plan with your provider may help take some of the stress and urgency out of paying a steep medical bill. These options may come with fees or interest, so compare medical bill payment options to find the most affordable one.
Buy now, pay later loan
“Buy now, pay later” is an at-checkout financing option that lets you split a purchase into smaller installments. It’s typically best for necessary purchases that will otherwise stretch your budget and if you have a plan to make the payments on time.
Cash advance app
A cash advance app gives you an advance up to a few hundred dollars and withdraws repayment — plus any tips and fees — on your next payday. These apps can help bridge a temporary income gap, but be sure you can cover regular expenses when the advance is taken from your next paycheck to avoid falling into a debt cycle.
Methodology
NerdWallet’s review process evaluates and rates personal loan products from more than 35 technology companies and financial institutions. We collect over 50 data points from each lender and cross-check company websites, earnings reports and other public documents to confirm product details. We may also go through a lender’s pre-qualification flow and follow up with company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
Our star ratings award points to lenders that offer consumer-friendly features, including: soft credit checks to pre-qualify, competitive interest rates and no fees, transparency of rates and terms, flexible payment options, fast funding times, accessible customer service, reporting of payments to credit bureaus and financial education. Our ratings award fewer points to lenders with practices that may make a loan difficult to repay on time, such as charging high annual percentage rates (above 36%), underwriting that does not adequately assess consumers’ ability to repay and lack of credit-building help. We also consider regulatory actions filed by agencies like the Consumer Financial Protection Bureau. We weigh these factors based on our assessment of which are the most important to consumers and how meaningfully they impact consumers’ experiences.
NerdWallet does not receive compensation for our star ratings. Read more about our ratings methodologies for personal loans and our editorial guidelines.
