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Here are 7 lenders for you

Upstart

on NerdWallet

Upstart

4.5

NerdWallet rating 
Upstart

4.5

NerdWallet rating 
Loan term 
3 to 5 years 

Loan amount 
$1,000 - $50,000 

APR 
4.81-35.99% 

on NerdWallet

Min. credit

None

Qualifications

  • Minimum credit score: None.

  • Minimum credit history: None, this lending platform accepts borrowers with credit history too limited to produce a FICO score.

  • Minimum gross income: $12,000.

  • Employment: Full-time job, full-time job offer starting in 6 months, a regular part-time job, or another source of regular income.

  • Must have U.S. residential street address where borrower resides (unless military personnel on active duty).

  • Must be at least 18 years old.

  • Valid email account required.

  • Personal bank account with U.S. routing number required.

Pros

  • Accepts borrowers new to credit.

  • Able to fund loans within one business day.

  • Offers direct payment to creditors with some debt consolidation loans.

  • Allows borrowers to choose and change payment date.

Cons

  • Borrowers can choose from only two repayment term options.

  • Charges origination fee.

  • No mobile app to manage the loan.

Disclaimer

Your loan amount will be determined based on your credit, income, and certain other information provided in your loan application. Not all applicants will qualify for the full amount. The minimum loan amount in MA is $7,000. The minimum loan amount in Ohio is $6,000. The minimum loan amount in NM is $5,100. The minimum loan amount in GA is $3,100. This offer is conditioned on final approval based on our consideration and verification of financial and non-financial information. Rate and loan amount are subject to change based upon information received in your full application. This offer may be accepted only by the person identified in this offer, who is old enough to legally enter into contract for the extension of credit, a US citizen or permanent resident, and a current resident of the US. Duplicate offers are void. Closing your loan is contingent on your meeting our eligibility requirements, our verification of your information, and your agreement to the terms and conditions on the www.upstart.com website.The full range of available rates varies by state. The average 3-year loan offered across all lenders using the Upstart platform will have an APR of 21.97% and 36 monthly payments of $35 per $1,000 borrowed. For example, the total cost of a $10,000 loan would be $12,646 including a $626 origination fee. APR is calculated based on 3-year rates offered in the last 1 month. There is no down payment and no prepayment penalty. Your APR will be determined based on your credit, income, and certain other information provided in your loan application. Not all applicants will be approved.If you accept your loan by 5pm EST (not including weekends or holidays), you will receive your funds the next business day. Loans used to fund education related expenses are subject to a 3 business day wait period between loan acceptance and funding in accordance with federal law.

Best Egg

on NerdWallet

Best Egg

4.5

NerdWallet rating 
Best Egg

4.5

NerdWallet rating 
Loan term 
2 to 5 years 

Loan amount 
$2,000 - $50,000 

APR 
5.0-36.0% 

on NerdWallet

Min. credit

600

Qualifications

  • Minimum credit score: 600; borrower average is 700.

  • Minimum credit history: 3 years and 3 accounts.

  • Minimum income requirement is $3,500; borrower average is $80,000. Borrower must have enough cash flow to cover current financial obligations.

  • Minimum debt-to-income ratio: 40% or 65% including a mortgage; borrower average is 40%.

  • Employment: Must provide proof of income; part-time employees are eligible.

  • Must provide valid U.S. address and Social Security number.

Pros

  • Offers wide range of loan amounts.

  • Provides secured loan option for homeowners.

  • Offers direct payment to creditors with debt consolidation loans.

Cons

  • Charges origination fee.

  • No rate discount for autopay.

Disclaimer

*Trustpilot TrustScore as of June 2020. Best Egg personal loans, including the Best Egg Secured Loan, are made by Cross River Bank, a New Jersey State Chartered Commercial Bank, Member FDIC, Equal Housing Lender or Blue Ridge Bank, a Nationally Chartered Bank, Member FDIC, Equal Housing Lender. “Best Egg” is a trademark of Marlette Holdings, Inc., a Delaware corporation. All uses of “Best Egg” refer to “the Best Egg personal loan”, “the Best Egg Secured Loan”, and/or “Best Egg on behalf of Cross River Bank or Blue Ridge Bank, as originator of the Best Egg personal loan,” as applicable. The term, amount, and APR of any loan we offer to you will depend on your credit score, income, debt payment obligations, loan amount, credit history and other factors. Your loan agreement will contain specific terms and conditions. About half of our customers get their money the next day. After successful verification, your money can be deposited in your bank account within 1-3 business days. The timing of available funds upon loan approval may vary depending upon your bank’s policies. Loan amounts range from $2,000– $50,000. Residents of Massachusetts have a minimum loan amount of $6,500 ; New Mexico and Ohio, $5,000; and Georgia, $3,000. For a second Best Egg loan, your total existing Best Egg loan balances cannot exceed $50,000. Annual Percentage Rates (APRs) range from 4.99%–35.99%. The APR is the cost of credit as a yearly rate and reflects both your interest rate and an origination fee of 0.99%–5.99% of your loan amount, which will be deducted from any loan proceeds you receive. The origination fee on a loan term 4-years or longer will be at least 4.99%. Your loan term will impact your APR, which may be higher than our lowest advertised rate.  You need a minimum 700 FICO® score and a minimum individual annual income of $100,000 to qualify for our lowest APR. To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account. What this means for you: When you open an account, we will ask for your name, address, date of birth, and other information that will allow us to identify you. We may also ask to see your driver’s license or other identifying documents.

LendingClub

on NerdWallet

LendingClub

4.0

NerdWallet rating 
LendingClub

4.0

NerdWallet rating 
Loan term 
3 to 5 years 

Loan amount 
$1,000 - $40,000 

APR 
7.0-35.9% 

on NerdWallet

Min. credit

600

Qualifications

  • Minimum credit score of 600. LendingClub uses FICO 8 credit scoring model.

  • Minimum credit history of three years.

  • Debt-to-income ratio of less than 40% for single applications, 35% combined for joint applicants.

Pros

  • Offers co-signed and joint loan options.

  • Offers direct payment to creditors with debt consolidation loans.

  • Soft credit check with pre-qualification.

Cons

  • Borrowers can only choose from two repayment term options.

  • Rates are high compared to other fair-credit lenders.

  • Charges an origination fee.

Disclaimer

A representative example of loan payment terms is as follows: you receive a loan of $13,411 for a term of 36 months, with an interest rate of 12.16% and a 5.30% origination fee of $711, for an APR of 15.99%. In this example, you will receive $12,700 and will make 36 monthly payments of $446.46. Loan amounts range from $1,000 to $40,000 and loan term lengths are 36 months or 60 months. Some amounts and term lengths may be unavailable in certain states. APR ranges from 7.04% to 35.89% and is determined at the time of application. Origination fee ranges from 3% to 6% of the loan amount. Lowest APR is available to borrowers with excellent credit. Advertised rates and fees are valid as of 7/1/21 and are subject to change without notice. Loans are made by LendingClub Bank, N.A., Member FDIC (“LendingClub Bank”), a wholly-owned subsidiary of LendingClub Corporation, NMLS ID 167439. Loans are subject to credit approval and sufficient investor commitment before they can be funded or issued. Certain information that we subsequently obtain as part of the application process (including but not limited to information in your consumer report, your income, the loan amount that your request, the purpose of your loan, and qualifying debt) will be considered and could affect your ability to obtain a loan from us. Loan closing is contingent on accepting all required agreements and disclosures at Lendingclub.com. “LendingClub” is a trademark of LendingClub Bank.

OneMain

on NerdWallet

OneMain

4.0

NerdWallet rating 
OneMain

4.0

NerdWallet rating 
Loan term 
2 to 5 years 

Loan amount 
$1,500 - $20,000 

APR 
18.00-35.99% 

on NerdWallet

Min. credit

None

Qualifications

  • Minimum credit score: None.

  • Minimum income: None; average is $45,000.

Pros

  • Option to choose your payment date.

  • Offers joint and secured loans.

  • Able to fund a loan the same or next business day.

  • Offers direct payment to creditors on debt consolidation loans.

Cons

  • Rates are high compared to other online lenders.

  • Charges origination fee.

  • No rate discount for autopay.

Disclaimer

Not all applicants will qualify for larger loan amounts or most favorable loan terms. Loan approval and actual loan terms depend on your ability to meet our credit standards (including a responsible credit history, sufficient income after monthly expenses, and availability of collateral). Larger loan amounts require a first lien on a motor vehicle no more than ten years old, that meets our value requirements, titled in your name with valid insurance. Maximum annual percentage rate (APR) is 35.99%, subject to state restrictions. APRs are generally higher on loans not secured by a vehicle. Depending on the state where you open your loan, the origination fee may be either a flat amount or a percentage of your loan amount. Flat fee amounts vary by state, ranging from $25 to $300. Percentage-based fees vary by state ranging from 1% to 10% of your loan amount subject to certain state limits on the fee amount. Active duty military, their spouse or dependents covered under the Military Lending Act may not pledge any vehicle as collateral for a loan. OneMain loan proceeds cannot be used for postsecondary educational expenses as defined by the CFPB’s Regulation Z, such as college, university or vocational expenses; for any business or commercial purpose; to purchase securities; or for gambling or illegal purposes. Borrowers in these states are subject to these minimum loan sizes: Alabama: $2,100. California: $3,000. Georgia: Unless you are a present customer, $3,100 minimum loan amount. Ohio: $2,000. Virginia: $2,600. Borrowers (other than present customers) in these states are subject to these maximum unsecured loan sizes: North Carolina: $7,500. New York: $20,000. An unsecured loan is a loan which does not require you to provide collateral (such as a motor vehicle) to the lender.

LendingPoint

on NerdWallet

LendingPoint

4.0

NerdWallet rating 
LendingPoint

4.0

NerdWallet rating 
Loan term 
2 to 4 years 

Loan amount 
$2,000 - $36,500 

APR 
24.75% 

on NerdWallet

Min. credit

580

Qualifications

  • Minimum credit score of 580; average is 673.

  • No minimum income; average customer earns $80,000.

  • Debt-to-income ratio of less than 50%, not including mortgage; average customer's ratio is 13%.

Pros

  • Soft credit check with pre-qualification.

  • Option to choose and change your payment date.

  • Can fund a loan the business day after approval.

Cons

  • No co-signed, joint or secured loan option.

  • Rates are high compared to other bad-credit lenders.

  • Reports payments to two of the three major credit bureaus.

  • Does not offer direct payment to creditors with debt consolidation loans.

Disclaimer

Loan approval is not guaranteed. Actual loan offers and loan amounts, terms and annual percentage rates (“APR”) may vary based upon LendingPoint's proprietary scoring and underwriting system's review of your credit, financial condition, other factors, and supporting documents or information you provide. Origination or other fees from 0% to 6% may apply depending upon your state of residence. Upon LendingPoint's final underwriting approval to fund a loan, said funds are often sent via ACH the next non-holiday business day. LendingPoint makes loan offers from $2,000 to $25,000, at rates ranging from a low of 15.49% APR to a high of 34.99% APR, with terms from 24 to 48 months.

Prosper Borrowers

on NerdWallet

Prosper Borrowers

3.5

NerdWallet rating 
Prosper Borrowers

3.5

NerdWallet rating 
Loan term 
3 to 5 years 

Loan amount 
$2,000 - $40,000 

APR 
32.0% 

on NerdWallet

Min. credit

600

Qualifications

  • Minimum credit score: 640; borrower average is 726.

  • Minimum credit history: 2 years.

  • Minimum income: No minimum income requirement; borrower average is $113,000.

  • Maximum debt-to-income ratio: 50% (excluding mortgage); borrower average is 18% with housing payment.

  • No bankruptcies filed within the past year.

  • At least three open accounts on credit report.

  • Fewer than five credit bureau inquiries in the last six months.

  • Must be at least 18 years old.

  • Must provide Social Security number and a U.S. bank account.


Pros

  • Option to change your payment date.

  • Offers joint loan.

  • Offers wide range of loan amounts. 


Cons

  • No rate discount for autopay.

  • Charges origination and late fees.

  • Borrowers can choose from only two repayment term options.

Disclaimer

For example, a three-year $10,000 personal loan would have an interest rate of 11.74% and a 5.00% origination fee for an annual percentage rate (APR) of 15.34% APR. You would receive $9,500 and make 36 scheduled monthly payments of $330.90. A five-year $10,000 personal loan would have an interest rate of 11.99% and a 5.00% origination fee with a 14.27% APR. You would receive $9,500 and make 60 scheduled monthly payments of $222.39. Origination fees vary between 2.41%-5%. Personal loan APRs through Prosper range from 7.95% to 35.99%, with the lowest rates for the most creditworthy borrowers. Eligibility for personal loans up to $40,000 depends on the information provided by the applicant in the application form. Eligibility for personal loans is not guaranteed, and requires that a sufficient number of investors commit funds to your account and that you meet credit and other conditions. Refer to Borrower Registration Agreement for details and all terms and conditions. All personal loans made by WebBank, Member FDIC.

Universal Credit

on NerdWallet

Universal Credit

4.5

NerdWallet rating 
Universal Credit

4.5

NerdWallet rating 
Loan term 
3 to 5 years 

Loan amount 
$1,000 - $50,000 

APR 
34.99% 

on NerdWallet

Min. credit

560

Qualifications

  • Minimum credit score: 560.

  • Minimum number of accounts on credit history: 2 accounts.

  • Maximum debt-to-income ratio: 75%, including mortgage and the loan you’re applying for.

Pros

  • Offers rate discount with direct payment to creditors on debt consolidation loans.

  • Option to change your payment date.

  • Offers free credit score access.

  • Offers a .5% rate discount for setting up autopay.

Cons

  • Charges origination fee.

  • No co-sign, joint or secured loan option.

Disclaimer

Personal loans made through Universal Credit feature APRs of 8.93%-35.93%. All personal loans have a 4.25% to 8% origination fee, which is deducted from the loan proceeds. Lowest rates require Autopay and paying off a portion of existing debt directly. For example, if you receive a $10,000 loan with a 36-month term and a 27.65% APR (which includes a 22.99% yearly interest rate and a 6% one-time origination fee), you would receive $9,400 in your account and would have a required monthly payment of $387.05. Over the life of the loan, your payments would total $13,933.62. The APR on your loan may be higher or lower and your loan offers may not have multiple term lengths available. Actual rate depends on credit score, credit usage history, loan term, and other factors. Late payments or subsequent charges and fees may increase the cost of your fixed rate loan. There is no fee or penalty for repaying a loan early.


Bad Credit Loans: What You Need to Know

Updated: Dec 7, 2021

Summary of best bad credit loan companies

Bad credit lenders each have something different to offer borrowers. These lenders report loan payments to the credit bureaus, so your on-time loan payments can help you build credit.

Upgrade: Best for bad credit debt consolidation loans.

Upstart: Best for borrowers with limited credit history.

LendingClub: Best for credit card consolidation loans for bad credit.

OneMain: Best for bad credit secured and co-signed loans.

Universal Credit: Best for bad credit loans with credit-building tools.

SeedFi: Best for bad credit loans that help you build savings.

Oportun: Best for small bad credit loans.

Bad credit loan rates

Personal loans can have high rates for borrowers with low credit scores. Borrowers with bad credit can expect an annual percentage rate between 20% and 30%. Some lenders may consider what you’re using the funds for and the amount you request when calculating your rate.

Personal loan interest rates by credit score

How's your credit?

Score range

Estimated APR

Excellent.

720-850.

11.2%.

Good.

690-719.

15.5%.

Fair.

630-689.

20.5%.

Bad.

300-629.

25.3% (Lowest scores unlikely to qualify).

Source: Average rates are based on aggregate, anonymized offer data from users who pre-qualified in NerdWallet’s lender marketplace from July 1, 2020, to July 31, 2021. Rates are estimates only and not specific to any lender.

What is a bad credit personal loan?

A bad credit loan is a personal loan for borrowers with low credit scores. These loans have fixed rates and are repaid in fixed monthly installments. They are typically not backed by collateral — they're unsecured. Lenders consider your credit score, credit report and debt-to-income ratio when deciding whether to lend you the money.

How a bad credit score affects your ability to get a loan

Having a bad credit score (300-629 on the FICO scale) doesn’t automatically disqualify you from getting a personal loan, but it lowers your chances of approval. If you do qualify, you may get an interest rate at the high end of a lender’s range.

Bad credit loans are often repaid in monthly installments, usually over one to five years. You can use the funds to pay for almost anything, including a home improvement project, medical bills or credit card consolidation.

How to compare bad credit loans

Qualifications

Many bad credit lenders consider your credit score on a personal loan application, but they also weigh other factors. Here are a few things lenders look for when qualifying you for a loan.

  • Credit score. If a lender has a minimum credit score requirement you’ll need at least that score, ideally a higher one, to qualify.

  • Debt-to-income ratio. This is the percentage of your monthly income that goes to debt repayment. Lenders typically like to see this below 40%.

  • Cash flow. Many lenders want to see that you have at least enough money to afford the new loan payments after you pay all your other bills.

  • Co-applicant and collateral. If you get a co-signed or secured loan, the person or time you add to your application becomes a factor in whether you qualify.

Rates and monthly payments

Bad credit loans typically have higher interest rates than good credit loans, but you should still compare offers to find the most affordable loan.

There are two ways to measure the cost of a loan:

Annual percentage rate: A loan’s annual percentage rate is similar to its interest rate, but it also includes any fees a lender may charge, like an origination or prepayment fee. Most financial experts agree that affordable loans should have an APR below 36%.

Monthly payments: Measure a loan’s monthly payment against your budget to see if you can afford it. You can use a personal loan calculator to see your monthly payments on a personal loan with any rate and term.

Repayment terms

Bad credit loan repayment terms tend to fall between one and five years. A longer repayment term will get you lower monthly payments, but you’ll pay more in total interest. Aim for a repayment term that keeps your monthly payments affordable, but helps you pay off the loan quickly.

Speed

A bad credit loan can be funded the day you’re approved or it could take up to a week. During the approval process, a lender may ask you for more documentation, like W-2s and pay stubs.

Credit-building features

Consider a bad credit lender that will help you understand and build your credit. Some lenders will share your FICO score with you for free and offer financial education to help you learn about ways to build credit.

Steps to get a personal loan with bad credit

Here are the steps to applying for a bad credit loan:

  1. Check your credit report: Before you apply for a personal loan, check your credit report and address any errors that could impact your score and hurt your chances of qualifying. NerdWallet offers free access to your TransUnion credit report. You can also get a free report from each of the three big credit bureaus (the other two are Experian and Equifax) from AnnualCreditReport.com.

  2. Review your budget: It helps to know your monthly budget when you’re about to apply for a personal loan — that way you’ll know how much you can afford to pay toward it each month.

  3. Pre-qualify online: Pre-qualifying lets you see potential loan rate, amount and repayment term offers from multiple online lenders. The process involves a soft credit check, which does not impact your score.

  4. Consider a co-signed or secured loan: Adding a co-signer or collateral, like a vehicle, to the loan application can improve your chances of qualifying or get you a lower rate.

  5. Gather your documents: A lender may ask for information such as your Social Security number, proof of employment and proof of income. Gather things like tax documents, pay stubs and W-2s before you apply to speed up the process.

  6. Submit an application: It can take anywhere from one business day to a week for a lender to review an application and fund a loan. The process triggers a hard credit inquiry, which can cause your score to dip, but it should rebound over time.

Types of bad credit loans

Unsecured bad credit personal loans

An unsecured loan doesn’t require collateral. Instead, a lender determines whether you qualify based on things like your credit score, income and cash flow.

It may be difficult for bad credit borrowers to qualify for an unsecured loan because many banks, credit unions and online lenders weigh your credit score heavily on a loan application.

Some online lenders, like those listed above, design their unsecured loans for consumers with low credit scores.

Secured bad credit loans

Credit standards are typically lower for secured loans, which require collateral, so it may be easier to qualify if you have bad credit.

When you add collateral to an application, the risk to the lender tends to be lower — it has something of value to take if you don't make the loan payments.

Banks and credit unions may let you use an account, like a savings or investment account, to secure the loan. Online lenders more often let you secure the loan with a vehicle.

Though adding collateral to the loan can help you qualify or get you a better rate, weigh the importance of getting the loan against the risk of losing your collateral.

Co-signed bad credit loans

A co-signer with better credit and a higher income may improve your chances of qualifying for a loan or get you a lower rate. It tells the lender that if you don’t make the loan payments, someone else likely will.

Co-signed loans aren’t as common as joint loans, where you have a co-borrower. Adding a co-borrower has a similar effect on your ability to qualify, but both borrowers have access to the funds on a joint loan. That isn’t the case with a co-signed loan.

With either option, if you fail to make payments on the loan, your co-applicant will be required to pay and both of your credit scores could take a hit.

Cash advance apps

A cash advance app lets you borrow from your next paycheck before you receive it. These apps typically don’t consider your credit score at all when you request an advance. Instead, they review your bank account to see when you get paid, how much and how you spend to determine whether you qualify for an advance.

They usually withdraw your funds on your following payday. Advance amounts are typically capped around $250.

These apps may charge fees for things like subscriptions or fast funding, and some ask you to tip them for the service. By using an app you may be paying to access money you’ve earned, so this should be one of the last financing options you consider.

If you use a cash advance app, check your budget and make a plan to cover your necessary expenses, like bill payments, with a smaller paycheck.

Spotting bad credit loan scams

The lenders on this page offer legitimate personal loans. Here are a few red flags to look out for when you're loan shopping.

No credit check or guaranteed approval: Reputable lenders dig into your finances, including your credit and income, to determine whether you can repay the loan. A lender that doesn't do this may charge exorbitant rates that could land you in a debt trap.

No state license: The Federal Trade Commission requires lenders to register in states where they do business. Many lenders list state licenses on their websites.

Asking for a gift card: No legitimate lender asks for a gift card in exchange for a loan. If you're asked to provide a gift card — even by someone who says they work for a popular lender — consider it a scam.

No fee disclosures: The Truth in Lending Act requires lenders to disclose the loan's APR, total interest and total repayment amount before you sign a loan agreement. Ask to see this information before signing and walk away if the lender refuses.

How to repay a bad credit personal loan

As with any debt you take on, have a plan to pay off your personal loan.

Update your budget: Follow a budget that divides your income into needs, wants, savings and debt to ensure timely monthly payments toward your personal loan.

Set up autopay: Setting up automatic payments ensures you’ll make them on time. Over time, this will help improve your credit score. Some lenders offer rate discounts to customers who use autopay.

Keep in touch with the lender: If you lose your job or encounter a surprise expense and think you may fall behind on payments, contact the lender right away to work toward a solution. Some lenders offer hardship programs or will temporarily defer your payments and waive late fees until you get back on your feet.

NerdWallet’s Personal Loan Rating Methodology

NerdWallet’s review process evaluates and rates personal loan products from more than 30 lenders. We collect over 45 data points from each lender, interview company representatives and compare the lender with others that seek the same customer or offer a similar personal loan product.

Our star ratings award points to lenders that offer consumer-friendly features. Here are some of the things that we look for:

  • 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.

  • Financial education.

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. This methodology applies only to lenders that cap interest rates at 36%, the maximum rate most financial experts and consumer advocates agree is the acceptable limit for a loan to be affordable. NerdWallet does not receive compensation for our star ratings. Read our editorial guidelines.

More bad credit loans


Disclaimers

Annual Percentage Rates (APR), loan term and monthly payments are estimated based on analysis of information provided by you, data provided by lenders, and publicly available information. All loan information is presented without warranty, and the estimated APR and other terms are not binding in any way. Lenders provide loans with a range of APRs depending on borrowers' credit and other factors. Keep in mind that only borrowers with excellent credit will qualify for the lowest rate available. Your actual APR will depend on factors like credit score, requested loan amount, loan term, and credit history. All loans are subject to credit review and approval.