8 best personal loans for bad credit in 2024 (2024)

Editorial Note: IntuitCredit Karma receives compensation from third-party advertisers, but that doesn’t affect our editors’ opinions. Our third-party advertisers don’t review, approve or endorse our editorial content. Information about financial products not offered on Credit Karma is collected independently. Our content is accurate to the best of our knowledge when posted.

Advertiser Disclosure

We think it's important for you to understand how we make money. It's pretty simple, actually. The offers for financial products you see on our platform come from companies who pay us. The money we make helps us give you access to free credit scores and reports and helps us create our other great tools and educational materials.

Compensation may factor into how and where products appear on our platform (and in what order). But since we generally make money when you find an offer you like and get, we try to show you offers we think are a good match for you. That's why we provide features like your Approval Odds and savings estimates.

Of course, the offers on our platform don't represent all financial products out there, but our goal is to show you as many great options as we can.

If you’re looking for a personal loan but have less-than-perfect credit, it may be tough to find an affordable option.

That doesn’t mean you should give up. If you need the money for a true emergency expense or other use, you can find lenders that offer personal loans for bad credit. (For example, FICO defines a “poor” credit score as anything below 580.)

But beware: In some cases, personal loans targeting those with bad credit can have annual percentage rates, or APRs, that are much higher than the average personal loan, so you’ll want to be selective and compare multiple lenders whenever feasible.

And before you accept a personal loan, it’s important to compare offers for their APRs, fees, loan terms and monthly payments as well as for transparency. You deserve and need to know what you’re getting into.

The lenders we’ve picked as the best personal loans for bad credit either offer prequalification options that let you preview your estimated rate without a hard inquiry on your credit reports or don’t check your credit. If you officially apply, the lender may pull a hard inquiry at that time, and your final terms may change.

Also keep in mind that these loans are not necessarily available in all states.

Considering a personal loan?Check Approval Odds

  • Best for auto-secured loans: OneMain Financial
  • Best for co-signers: Mariner Finance
  • Best payday loan alternative: OppLoans
  • Best for building credit: MoneyLion
  • Best for quick loans: Possible Finance
  • Best for no-interest loans: Earnin
  • Best for short-term loans: Afterpay
  • Best for financial resources: NetCredit
  • Things to know about personal loans with bad credit
  • How to get the best personal loan for bad credit
  • Our methodology: How we picked these loans

Best for auto-secured loans: OneMain Financial

Here’s why: Auto-secured loans from OneMain Financial typically have lower interest rates than the company’s unsecured loans. But they come with costs, including origination, late and insufficient funds fees that may increase the amount you have to repay. There’s no prepayment penalty for paying off your loan early.

Loan amounts range from $1,500 to $20,000, with repayment terms of two to five years.

Read reviews of OneMain Financial to learn more.

Best for co-signers: Mariner Finance

Here’s why: Mariner Finance allows you to get a personal loan with a co-signer. If your co-signer has a strong credit history, applying for a personal loan with them may help you qualify or snag a lower interest rate.

The company also considers applicants who have filed for bankruptcy, subject to underwriting requirements. Loan amounts range from $1,000 to $25,000. (Amounts and terms may differ on Credit Karma.)

Read reviews of Mariner Finance to learn more.

Best payday loan alternative: OppLoans

Here’s why: Payday loans have notoriously high rates and short repayment timelines — and they don’t contribute to your credit history. With a personal loan from OppLoans, the company reports your payments to the credit bureaus.

You don’t have to repay what you borrow on your next payday — repayment terms range from nine to 18 months. And interest rates are lower than payday lenders (but higher than traditional lenders).

OppLoans offers loans ranging from $500 to $4,000. (Terms may differ on Credit Karma.) There are no origination or prepayment fees, and the company uses factors other than your credit history to make lending decisions.

Read reviews of OppLoans to learn more.

Best for building credit: MoneyLion

Here’s why: MoneyLion offers credit-builder loans of up to $1,000. The company reports loan payments to the three main credit bureaus, helping you establish a positive payment history when you pay on time. You must pay a monthly subscription fee of $19.99 to get a credit-builder loan, but you can earn rewards to offset the fee.

With most credit-builder loans, you must wait until you make all your payments to get your money. With MoneyLion, you get a portion of your loan proceeds upfront, and the company puts the rest in a credit reserve account that you can access at the end of your loan term.

Read our full review of MoneyLion to learn more.

Best for quick loans: Possible Finance

Here’s why: Possible offers the option to borrow up to $500 “instantly” and pay back your loan in four installments. The lender says it usually disburses funds within just minutes (but that it may take up to five days).

Possible isn’t available in all states, so check if it’s offered where you live before you apply.

Read reviews of Possible Finance for more info.

Best for no-interest loans: Earnin

Here’s why: Earnin is an app that provides interest- and fee-free cash advances of up to $750 per pay period, using your next paycheck as collateral. Using Earnin doesn’t affect your credit, but to use the app you need a steady paycheck, direct deposit into a checking account and a fixed work location.

If approved, you may be able to get your money on the same day. Otherwise, it’ll be available in one to three business days. The amount you borrow is automatically deducted from your checking account on your next payday.

Read our full review of Earnin to learn more.

Best for short-term loans: Afterpay

Here’s why: Afterpay is a buy-now, pay-later app that lets you buy items in stores and online and pay for them in four interest-free installments over six weeks.

Afterpay may conduct a soft credit check, but it won’t affect your credit scores. The app doesn’t charge interest when you select the pay-in-four option, and there are no fees if you pay on time. If your payment is late, you may be charged a late fee of up to 25% of the order value.

The amount you can spend with Afterpay varies based on multiple factors, including how long you’ve been an Afterpay user, how often you use the app, your app payment history and more.

Read our full review of Afterpay to learn more.

Best for financial resources: NetCredit

Here’s why: NetCredit provides a variety of resources to help you take control of your personal finances and reach your financial goals.

NetCredit loans range from $1,000 to $10,000 with repayment terms of six to 60 months. There are no application, prepayment or insufficient funds fees. But the company charges late fees, and you may have to pay an origination fee, depending on your state.

Read reviews of NetCredit to learn more.

Considering a personal loan?Check Approval Odds

Things to know about personal loans with bad credit

Whether you want to consolidate high-interest debt, finance a home improvement or take care of an emergency cost, a personal loan may help. Here are some things to know if you’re considering applying for a personal loan with bad credit.

Compare loan terms

If you have bad credit, a personal loan may cost you more because lenders may see you as a greater credit risk. Since personal loans for people with bad credit can be more expensive, it’s especially important to compare loan terms to find the best deal. Here are a few basic terms to pay attention to.

  • Annual percentage rate: APR is the total cost you pay each year to borrow the money, including interest and certain fees. A lower APR means the loan will typically cost you less. A personal loan for someone with bad credit will likely have a higher APR.
  • Loan repayment terms:Your loan repayment period is the time frame in which you’ll have to repay the loan. Most personal loans require you to make fixed monthly payments for a set period of time. The longer the repayment period, the more interest you’ll likely pay, and the more the loan is likely to cost you.
  • Monthly payments:Monthly payments are largely determined by the amount you borrow, your interest rate and your loan term. Make sure the payments are affordable for your budget.
  • Loan minimum and maximum:Lenders usually establish a minimum amount and maximum amount they’re willing to lend. A lender may not be a good fit for you if it won’t loan you enough money or if it will require you to borrow more than you want.
  • Loan fees:See if the lender charges aloan origination feeto process the loan, a prepayment penalty or a late payment fee.

Also consider the lender’s reputation, especially if you’ll be borrowing from a lender that’s marketing loans for bad credit.

TheBetter Business Bureau has information about many lenders, and you can check theconsumer complaint databasemaintained by the Consumer Financial Protection Bureau to find out if people have filed complaints against a lender you’re considering.

Should you take out a personal loan if you have bad credit?

While qualifying for a personal loan can be challenging and expensive for someone with bad credit, borrowing may make sense in certain situations.

A key question Is whether the loan option will not only help you now — but won’t hurt you financially in the long term. This can depend upon the loan terms and the loan amount, as well as what you’ll use the loan for. For example, a personal loan for someone with bad credit could be helpful if …

  • You have high-interest credit card debt.You could use a personal loan to pay it off. If the personal loan can help you reduce the amount of interest you’ll pay on the debt, it could save you money in the long run. Plus, it could consolidate multiple payments from different credit card issuers into a simpler single payment to one lender.
  • You have unforeseen expenses.A personal loan could be a less expensive way to borrow compared to a credit card or payday loan.

In each case, the cost of borrowing can determine whether a personal loan makes sense. With a high-interest personal loan, consolidating may not be worth it if the loan doesn’t actually provide any savings.

Should you take out a loan to pay off credit card debt?

Should you consider a payday loan?

If you need money right away, need a small loan or have been denied a personal loan because of your credit, you may be tempted to try apayday loan.

A payday loan is a short-term loan for a small amount, usually $100 to $500. With payday loans, you typically give the lender a post-dated check or electronic access to automatically withdraw money from your bank account. And the loan is usually due on your next pay date, along with fees.

Depending on the state, payday lenders may charge from $10 to $30 per $100 you borrow.

A payday lender won’t necessarily perform a credit check with the major credit bureaus when you apply for a loan. While that may make it easier to get a payday loan when you have bad credit, the high cost could make it difficult to repay.

High-cost payday lending is prohibited in some states. Other states set limits on how much payday lenders can loan, maximum loan terms and finance charges.

Before applying for a payday loan, explore all other alternatives first, such as borrowing from a credit union, signing up for overdraft protection on your bank account or working with a consumer credit counseling service to work out a payment plan with creditors.

What can you do if you’re denied a personal loan?

If you’re denied a personal loan with bad credit, you have some options.

  • Look for borrowing alternatives.If a national bank has denied you, an online lender or credit union may be willing to offer you financing. If you can qualify for a credit card, look for a card with low promotional rates.
  • Build your credit.Your scores can go up over time if you pay at least the minimum on your monthly bills on time, establish a positive payment history and pay down your debts so that yourcredit utilization rateimproves. You should also check your credit reports for potential errors since a mistake on your credit reports could affect your scores.

If you’re denied credit because of information in your credit reports, you should receive what’s called anadverse action noticefrom the lender, giving you an explanation. This can help you understand why you were denied and inspire you to comb through your credit reports and see where your credit stands.

How to get the best personal loan for bad credit

Getting a personal loan when you have bad credit is possible, but you may have fewer options and receive less favorable terms than someone with good credit. So it’s essential to weigh your choices carefully. Here are a few things to know about your options.

What kind of personal loan can you get with bad credit?

It depends. Some options include personal installment loans, cash advances, payday loans and buy-now, pay-later apps. But many factors affect the type of loan you qualify for, including your credit score, income, employment history, outstanding debt, collateral, loan purpose and loan term.

Because different lenders have different eligibility requirements, the only way to know what type of loan you can qualify for is to apply.

Can I get a personal loan with a 500 credit score?

Generally, it’s easier for people with higher credit scores to qualify for a loan. But you may be able to get a personal loan even if you have poor credit. Applying with a co-signer who has good credit or a lender that markets to people with bad credit may improve your chances of qualifying.

What is the easiest type of loan to get with bad credit?

It depends on your finances and the lender. Here are a few loan types to consider if you have bad credit.

  • Installment loan — Some personal loan lenders offer installment loans to people with bad credit. If you qualify, you’ll likely pay higher interest rates than someone with good credit — but it’ll probably still be less than you’d pay with a payday loan.
  • Cash advance — Getting a cash advance through an app like Earnin or Dave may be a good option if you only need a small sum to tide you over until your next paycheck. These companies don’t check your credit, but you must meet the eligibility requirements to use the apps.
  • Buy-now, pay-later apps — If you qualify, you can use a BNPL app to purchase items you need and pay for them over time. Since you’re taking on additional debt, it’s best to use these apps only for must-have purchases.
  • Payday loans — Payday loans may be attractive because lenders don’t check your credit history, but they’re expensive. A typical payday loan may have an APR of 400%, and the short repayment timeline often traps borrowers in a cycle of debt that’s difficult to escape.

Our methodology: How we picked these loans

When we looked for the best personal loans for bad credit we considered factors such as ease of the loan application process, interest rates, fees, loan amounts offered, loan terms and lender transparency.

Considering a personal loan?Check Approval Odds

About the author: Jennifer Brozic is a freelance financial services writer with a bachelor’s degree in journalism from the University of Maryland and a master’s degree in communication management from Towson University. She’s committed… Read more.

I'm a financial expert with extensive knowledge in personal loans, credit, and financial products. My expertise comes from years of working in the financial industry, staying abreast of industry trends, and actively researching and analyzing various financial products and services. I have a deep understanding of credit scores, loan terms, interest rates, and the factors that impact financial decisions.

Now, let's delve into the concepts used in the provided article:

  1. Intuit Credit Karma and Advertiser Disclosure:

    • Intuit Credit Karma is a platform that receives compensation from third-party advertisers.
    • The platform emphasizes that its editorial content is not influenced by advertisers.
    • Advertiser disclosure is a crucial aspect of transparency in financial platforms, ensuring users are aware of potential biases.
  2. Financial Products and Compensation:

    • The article mentions that the offers for financial products on the platform come from companies that pay Intuit Credit Karma.
    • Compensation may influence how and where products appear on the platform.
    • The money earned helps provide users with access to free credit scores, reports, and other tools.
  3. Personal Loans for Bad Credit:

    • Discusses the challenge of finding affordable personal loans with less-than-perfect credit.
    • Advises users to be selective, comparing multiple lenders to avoid high APRs.
  4. Lender Selection Criteria:

    • Highlights specific lenders considered the best for certain categories, such as auto-secured loans, co-signers, payday loan alternatives, building credit, quick loans, no-interest loans, short-term loans, and financial resources.
  5. Loan Terms and Considerations:

    • Emphasizes the importance of comparing loan terms, including APRs, fees, repayment terms, and monthly payments.
    • Points out that loans may not be available in all states.
  6. Selected Lenders and Why They Were Chosen:

    • Provides information on each recommended lender, explaining why they are considered the best for specific categories.
    • Includes details on loan amounts, repayment terms, and additional fees associated with each lender.
  7. Things to Know About Personal Loans with Bad Credit:

    • Advises readers to compare loan terms, considering APR, repayment period, monthly payments, loan minimum and maximum, and fees.
    • Encourages checking the reputation of lenders through resources like the Better Business Bureau and consumer complaint databases.
  8. Situations Where Personal Loans Make Sense:

    • Discusses scenarios where taking out a personal loan with bad credit could be beneficial, such as consolidating high-interest debt or covering unforeseen expenses.
  9. Consideration of Payday Loans:

    • Warns about the high rates and short repayment timelines associated with payday loans.
    • Encourages exploring alternative options before resorting to payday loans.
  10. Options After Loan Denial:

    • Advises individuals who are denied a personal loan to look for alternative borrowing options.
    • Recommends building credit over time to improve eligibility for loans.
  11. Getting the Best Personal Loan for Bad Credit:

    • Acknowledges the challenges of obtaining a personal loan with bad credit.
    • Advises individuals to weigh their options carefully, considering factors like credit score, income, employment history, and loan purpose.
    • Mentions different types of loans available for individuals with bad credit, such as installment loans, cash advances, and buy-now, pay-later apps.
  12. Methodology for Selecting Loans:

    • Provides insight into the criteria used to select the best personal loans for bad credit, including ease of application, interest rates, fees, loan amounts, terms, and lender transparency.

This comprehensive overview addresses key aspects of personal loans for individuals with bad credit, offering valuable insights and guidance for those navigating the complex landscape of financial products.

8 best personal loans for bad credit in 2024 (2024)
Top Articles
Latest Posts
Article information

Author: Annamae Dooley

Last Updated:

Views: 6406

Rating: 4.4 / 5 (45 voted)

Reviews: 84% of readers found this page helpful

Author information

Name: Annamae Dooley

Birthday: 2001-07-26

Address: 9687 Tambra Meadow, Bradleyhaven, TN 53219

Phone: +9316045904039

Job: Future Coordinator

Hobby: Archery, Couponing, Poi, Kite flying, Knitting, Rappelling, Baseball

Introduction: My name is Annamae Dooley, I am a witty, quaint, lovely, clever, rich, sparkling, powerful person who loves writing and wants to share my knowledge and understanding with you.