Poor financial choices can leave you with a less-than-stellar credit score and the need to access a loan. Is it possible to get personal loans with low credit score? Most people are left at a loss on how they can take out a loan based on their poor credit. We are here to help you address that concern. It is understandable how life throws curveballs, and at times, a personal loan with no income verification might be the only way out of a financial emergency. It all begins with knowing your credit score.
Most of the online loans with monthly payments can go a long way towards consolidating debt as well as funding major purchases with no credit cards. Besides, when taking out unsecured loans you do not have to risk your car or home as collateral as other loans do. Nevertheless, it is still hard to be sanctioned for personal loans with low credit score, and you might have already encountered challenges when doing that. Fortunately, you can still access funding, even with a poor credit history or issues in your credit report. A guaranteed loan approval no credit check is one of the loan types you could try. Even so, you have fewer options with bad credit, and finding funding will be more costly.
It is recommended to get quotes from various types of local and online lenders. Compare them and settle on the best deal. However, you should only do that if the lender says checking for those offers is not going to affect your credit score. Things might seem grim when you are self-employed with bad credit since some lenders need to verify your employment status before granting a loan. In such cases, using no proof of income loans self employed might be the best way out.
Top 5 Best Personal Loans With Low Credit Score
Low credit score typically refers to your FICO score. The 8-score model of FICO categorizes scores under 578 as bad credit. If your credit score is slightly better, then you should consider personal loans for fair credit. Otherwise, personal loans with bad credit score are the ultimate solution to your funding issues. Usually, the rule of thumb is to avoid borrowing until you can improve your credit. However, that is not always an option. If you need personal loans with less-than-stellar credit score, begin with the resources below. This list is optimized to assist you to locate the best companies for personal loan that:
- Have high approval odds even with bad credit
- Offer competitive interest rates for personal loans
Based on the criteria above, below are our best picks of lenders that provide personal loans with low credit score.
1. OneMain Financial
The OneMain Financial institution comes with all kinds of personal loans. However, they are an excellent choice if you need unsecured and secured loans. Usually, when you are in the less than perfect credit range, you might have to get their secured loan or choose a low loan amount to access an unsecured loan. Therefore, if decreasing the loan amount does not work in your situation, it means putting something up as collateral to take care of the lender’s risk.
Although bad credit loans often range from $1,500 to $10,000, better credit scores could see you qualify for loans of up to $20,000. The APR is normally between 18% and 35.99%. Most of OneMain’s term lengths are between 24 and 60 months. The best part is that if you do not intend to use one of their 1,600 branches, you can still do the whole application online.
- Suitable for credit scores under 600
- Available in secured and unsecured loans
- Have a face-to-face option with over 1,600 branches
- Have an A+ Better Business Bureau rating
- Difficult nailing down specific loan amounts and APRs on the digital platform
- Branches only in 44 states, which can restrict you to online processes
Avant loans focus on the average borrowers with a credit score range of 600 and 700. If that is your credit range, you can quickly access funds from Avant. In fact, you can get the loan as soon as the next business day of filing in your application.
Loans start from $2,000 to $35,000 and APRs range from 9.95% to 35.99%. Moreover, Avant’s loan terms have a range of 24 to 60 months. Nonetheless, you will want to watch out for an administration fee that ranges between 1.50% and 4.75%.
- Interest rates are between 9.95% and 35.99%
- Available in 46 states plus the Columbia District
- Turnaround is one business day to get your funding
- Amounts begin from $2,000 to $35,000
- Flexible payment terms from 2 years to five years
- Carry the Better Business Bureau A+ rating
- Lacks secured loans
- Accepts credit scores over 580
- Not available in Iowa, West Virginia, Colorado and Vermont
3. Bad Credit Loans
If you are trying to access personal loans with low credit score, and particularly really bad credit, the options are limited. However, BadCreditLoans.com is an online platform connecting poor credit borrowers to a network of willing lenders. You need to be at 18 years of age to apply online. In addition, you must have a valid phone number plus an email address.
For identification, this lender requires the following:
- Provide proof of legal residency or citizenship
- Have a checking account in your name
- Have a regular income including social security, self-employment, full-time, or disability
Once you place in your request, the next thing is to wait for offers from potential lenders in their network. You’ll want to keep in mind that depending on the situation of your financial records, you might not receive offers. If you get willing lenders, the amounts typically range between $500 and $5,000 and APRs starting at 5.99% to 35.99%. Repayment terms often range from 3 to 36 months.
For example, if you take out a loan of $3,000 carrying an interest rate of 35.99% for a 24-month term, you will be paying $177 every month. Therefore, this amounts to a principal of $3,173 as well as $1,252 in interest. This is not the best deal, but the bad credit loan is still far of preference to the predatory payday loans.
- Poor credit borrowers can still qualify for up to $1,000 loans
- They solicit offers on the borrower’s behalf making it easy to select the most suitable terms
- Free application with the obligation to accept offers you don’t like
- Pre-approvals in as little as 5 minutes depending on your financial solution
- No guarantee of receiving offers from lenders on the platform
- High-interest rates of up to 35.99%
- Bad credit loans are generally restricted to $1,000 or less
- Renewing loans can trap borrowers in a debt cycle
For those looking for bad credit choices with poor credit scores but not absolutely terrible, Peerform is an excellent lender to consider. This is a peer-to-peer lending platform, matching up borrowers to potential moneylenders. This is an intriguing concept that eliminates traditional banks from your equation. In fact, they sometimes carry lower fees due to less overhead.
You should keep in mind that Peerform does not accept applications with credit scores below 600. This is the more reason you should learn to improve your credit score. Due to the restrictions on their credit scores, their loans often range from $4,000 to $25,000. APRs range from 5.99% to 29.99%.
On the downside, Peerform’s applications can take as much as 2 weeks to receive funding. If you are in an emergency situation, this platform might not work for you. Furthermore, you must be careful about the origination fee, which often ranges from 1% to 5%.
- Have an A rating from the Better Business Bureau
- Borrowing up to $25,000
- Forthright online details regarding expected loan amounts, fees, and APRs
- Only qualifies borrowers with 600+ credit scores
- No option for secured loans
- Waiting longer for loan funding
- Comes with several fees including an origination fee that can be as high as 5%
One of the best things about NetCredit is they are lenient with low credit scores. If you are looking for personal loans with low credit score, it might help you to know that this lender sometimes accepts applications with scores below 550. Nevertheless, you should expect these offers to come at a cost. Loans start from $1,000 and can be as high as $10,000. Their APRs start from around 34% and in some instances can be as high as 155%. When your loan offers come with extremely high APRs, be sure to consider other options like using a consigner or getting a secured loan.
- They accept low credit score applications as low as 550
- Loans start at $1000 to $10,000
- Have secured loan options
- Very high APRs of up to 155%
How To Fix Bad Credit to Get Better Loans
Although it may sound obvious, the best method to a loan with poor credit is raising your credit score. The slightest the increase can go a long way to get you better loans. For instance, raising your scores from poor to fair can make a significant impact on the loan terms as well as interest rates for which you qualify. This way, you’ll get to save a lot of cash over the loan period.
There are vital steps you can take to raise your credit score. This is because having bad credit isn’t a life sentence, but a short-term situation that you can improve if you commit to the process. Therefore, before resigning yourself to a lifetime of poor credit, consider taking the following steps to access more and better funding:
- Know your credit report: If you are yet to know your credit report, you may want to use some of the free sites to pull out your credit report. It is essential to verify that there are no fraudulent activities or errors sticking your credit in the dumps.
- Always pay on time: When it comes to credit scores, nothing kills your ratings like late payments. You may want to set your bills for auto-payments to ensure that nothing goes wrong. Making smaller payments from time to time is a perfect way to improving your credit scores. It often indicates that you are using less of the available credit, which is a good thing for raising your credit scores.
- Avoid using most of the available credit: Whether you pay off credit on time or not, it a good practice not using up most of what is allocated to you.
- Do not close accounts: It is important if you have credit that you do not use. You can keep that account active by using it for small bill payments and paying it off on the instant. Having one account open for a number of years is a great way to increase your credit history, as well as boost your score.
- Leverage on tools for building credit: Secured credit cards are a perfect example of the tools that provide a way of making monthly payments and repairing credit history.
- Reduce on credit inquiries: Too many applications for loan products or credit cards that constantly pull your credit records can also lower your score.
- Request for re-aging: It is normal to have delinquencies on credit cards. However, once you get back on track, you can request your issuer to re-age the account. To qualify for this, it means making timely payments of not less than 3 months. If the issuer sanctions your account for re-aging, they will do away with all the previous due notations in your credit report.
The Bottom Line
If you are looking at bad credit, you already know too well with frustrations of low credit scores. You do not have to live with bad credit for the rest of your life. One of the best ways to fixing your credit is putting a stop to the habits that led to your low credit score. With the options for personal loans with low credit score above, you will be on your way to setting new records for your credit history.