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When you have bad credit, you have options for personal loans. But it’s important to research lenders carefully and compare APRs, fees and loan terms.
The best personal loan lenders for bad credit have lower minimum credit score requirements than traditional banks. They also offer low rates and help you build credit with on-time payments.
1. Upstart
Upstart offers personal loans for a range of purposes, with flexible loan terms and competitive rates. It also offers some unique features like the ability to add a co-borrower and direct payment to creditors on debt consolidation loans. Upstart’s eligibility criteria is not the strictest and it has a lower minimum credit score requirement than some other lenders, making it one of the best personal loan lenders for bad credit.
The lender uses an AI-powered platform that considers over 1,000 data points, allowing it to approve loans for people who may not meet traditional credit requirements. This includes factors like employment, education and income history. This is important because it allows borrowers to get access to loans when they would not qualify for other lenders. Upstart also has a low minimum loan amount and does not charge prepayment fees.
Although Upstart is an excellent choice for borrowers with bad credit, it does not have the lowest rates on the market and its origination fees are a bit higher than some other lenders. Also, Upstart has received a number of complaints from consumers, some of which are about a lack of transparency around the application process and rates.
Other lenders with competitive rates and reasonable origination fees for borrowers with bad credit include LightStream, which is an affiliate of TD Bank and offers low-interest unsecured personal loans for all types of purposes, and Happy Money, which is a financial wellness company that provides a payoff loan designed to help borrowers pay off high-interest credit card debt. Both offer fast approval and funding timelines.
2. OneMain Financial
OneMain Financial is a leading personal loan lender for bad credit, offering competitive rates and fast funding. The company offers unsecured personal loans for borrowers with bad credit, and a secured version is available to help you build your credit history. Its minimum interest rate is a little higher than Personify’s, but the latter’s maximum rate goes into the triple digits, making it much more expensive.
Like other lenders, OneMain Financial accepts a range of credit scores and income levels. Its application is straightforward and can be completed in just a few sunshine loans contact minutes. Its website allows borrowers to check their prequalification status without impacting their credit score, which makes it easy to see what rates they might be offered.
OneMain also has branches in every state it serves, so borrowers can meet with a representative in person. Its terms and fees are more flexible than those of payday loans, and the company does not allow borrowers to skip payments. It does charge a fee for late payments and returned payments, however.
OneMain has a relatively high customer satisfaction rating, but the Consumer Financial Protection Bureau has catalogued more than 770 complaints against it. This is a lot of complaints for a company that offers affordable personal loans to people with bad credit. It may be worth checking out other lenders, especially those that are more consumer-friendly and provide better loan terms than OneMain.
3. NetCredit
NetCredit is one of the best personal loan lenders for bad credit because it doesn’t require a minimum score and says on its website it considers borrowers with poor credit. It also reports repayment to Experian and TransUnion, which can help borrowers build credit if they pay on time.
NetCredit’s rates, however, are too high for most borrowers to afford, and the lender has been sued by state attorneys general for predatory lending practices. Its APRs range from 34% to 99.9%, well above the 12% cap in Virginia, which is the most restrictive state when it comes to personal loan rates.
Applying for a NetCredit personal loan involves a soft inquiry, which doesn’t affect your credit. Its application takes minutes and can be completed online. Once you’re approved, your requested funds are typically deposited the same day.
Unlike Upstart, NetCredit doesn’t offer pre-qualification for its loans, but it does allow borrowers to check their rate without impacting their credit score by sending in basic information about themselves, including their name, address, income and Social Security number. It also offers a mobile app, educational resources and budgeting tools. Its loans are available in 37 states. Applicants should make sure they live in the right state before applying.
4. Universal Credit
Universal Credit is an online lender that provides personal loans for borrowers with fair and bad credit. It’s a great option for those who need a small loan to cover unexpected expenses, consolidate debt, or make a large purchase. Universal Credit also offers a few unique features to help its customers, including credit monitoring tools and free autopay discounts. It’s worth noting, though, that Universal Credit’s rates are a bit higher than those of its competitors and that it charges a high origination fee.
The company also has a unique approach to debt consolidation, sending the loan funds directly to creditors on your behalf. Its website doesn’t mention whether this feature is available for all types of debt consolidation, but it’s worth checking with the lender to see if your specific debt type is eligible for this service.
During pre-qualification, Universal Credit may request documents like pay stubs and tax forms to verify your employment status and income level. Once approved, the company typically deposits the funds into your account within a business day. The company offers an unsecured personal loan for up to $15,000 and requires a minimum credit score of 660 to qualify.
Our rankings and reviews of personal loan lenders are based on our own research as well as data from dozens of sources, including customer surveys, APRs and fees, loan amounts and terms, special features and more. For more information, read our complete methodology.