BEST OF

Best Bad Credit Loans of March 2021

Bad-credit loans from online lenders can get you funds quickly, but they may have high rates. Look for a bad-credit loan that will help you build credit.

Annie MillerberndFebruary 2, 2021
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Consumers with low credit scores (roughly between 550 and 629 FICO) may qualify for a personal loan from an online lender that serves bad-credit borrowers. These lenders often provide a simple application process and fast funding, but the loans can have interest rates up to 36%.

Before you get a bad-credit loan, it's always a good idea to consider cheaper alternatives, like borrowing from a family member or picking up a side gig.

The online lenders listed here accept borrowers with low credit scores or thin credit histories and offer fast funding.

Summary of Best Bad Credit Loans of March 2021

Our pick for

Credit building tools

Upgrade

on Upgrade's website

Upgrade

5.0

NerdWallet rating 
Upgrade

Min. Credit Score

580

Est. APR

6.94 - 35.97%

Loan Amount

$1,000 - $50,000

on Upgrade's website


Min. Credit Score

580

Key facts

Upgrade offers personal loans plus credit-building tools; you'll need strong cash flow to qualify.

Pros

  • Allows secured, co-signed and joint loans.

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

  • Rate discount for autopay.

Cons

  • Charges origination fee.

  • Charges late fee.

Qualifications

  • Minimum credit score: 580.

  • Minimum annual income: None; average borrower income is $87,000.

  • Minimum credit history: 3 years.

  • Minimum number of accounts on credit history: 2.

  • Minimum monthly free cash flow: $800.

  • Maximum debt-to-income ratio: Varies between 55% and 65% including the loan you’re applying for and mortgage payments. To see your post-loan DTI, calculate your monthly payments on a personal loan, and then add them to your debt-to-income calculation.

  • Average loan amount is $10,000.

  • Average repayment term is 40 months.

Available Term Lengths

3 to 5 years

Fees

  • Origination fee: 2.9% to 8%.

Disclaimer

Personal loans made through Upgrade feature APRs of 6.94%-35.97%. All personal loans have a 2.9% 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 17.98% APR (which includes a 14.32% yearly interest rate and a 5% one-time origination fee), you would receive $9,500 in your account and would have a required monthly payment of $343.33. Over the life of the loan, your payments would total $12,359.97. 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. Personal loans issued by Upgrade's lending partners. Information on Upgrade's lending partners can be found at https://www.upgrade.com/lending-partners/. Accept your loan offer and your funds will be sent to your bank or designated account within one (1) business day of clearing necessary verifications. Availability of the funds is dependent on how quickly your bank processes the transaction. From the time of approval, funds should be available within four (4) business days. Funds sent directly to pay off your creditors may take up to 2 weeks to clear, depending on the creditor.
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Our pick for

Limited credit history

Upstart

on Upstart's website

Upstart

4.5

NerdWallet rating 
Upstart

Min. Credit Score

580

Est. APR

8.27 - 35.99%

Loan Amount

$1,000 - $50,000

on Upstart's website


Min. Credit Score

580

Key facts

Upstart is a good option for those who have short credit histories and promising financial futures.

Pros

  • Accepts borrowers new to credit.

  • Able to fund loans within one business day.

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

Cons

  • Borrowers can choose from only two repayment term options.

  • Charges origination fee.

Qualifications

  • Minimum credit score: 580.

  • 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.

Available Term Lengths

3 to 5 years

Fees

  • Origination fee: 0% - 8%.

  • Late fee: 5% of past due amount or $15, whichever is greater.

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 U.S. Duplicate offers received 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 25.79% and 36 monthly payments of $37 per $1,000 borrowed. There is no down payment and no prepayment penalty. Average APR is calculated based on 3-year rates offered in the last 1 month. 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.
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Our pick for

Flexible payments and refinance options

Avant

on Avant's website

Avant

4.0

NerdWallet rating 
Avant

Min. Credit Score

550

Est. APR

9.95 - 35.99%

Loan Amount

$2,000 - $35,000

on Avant's website


Min. Credit Score

550

Key facts

Avant's low starting rates make it a good option for borrowers with low credit scores and income.

Pros

  • Able to fund loans the next business day.

  • Option to change your payment date.

  • Soft credit check with pre-qualification.

  • Offers secured loan option.

Cons

  • Charge an origination fee.

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

  • No co-sign or joint loan option.

Qualifications

  • Minimum credit score of 550.

Available Term Lengths

2 to 5 years

Fees

  • Administrative fee: Up to 4.75%.

  • Late fee: $25 (most states).

  • Unsuccessful payment fee: $15 (most states).

Disclaimer

A $5,700 loan with an administration fee of 4.75% and an amount financed of $5,429.25, repayable in 36 monthly installments, would have an APR of 29.95% and monthly payments of $230.33. Minimum loan amounts may vary by state. If approved, the actual rate and loan amount that a customer qualifies for may vary based on credit determination and other factors. An administration fee of up to 4.75% will be deducted from the loan proceeds. Avant branded credit products are issued by Webbank, member FDIC
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Our pick for

Credit card consolidation

Lending Club

on LendingClub's website

LendingClub

4.0

NerdWallet rating 
Lending Club

Min. Credit Score

600

Est. APR

8.05 - 35.89%

Loan Amount

$1,000 - $40,000

on LendingClub's website


Min. Credit Score

600

Key facts

LendingClub is a pioneer of peer-to-peer lending and a good option if you want to consolidate your debt.

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 online lenders.

  • Charges an origination fee.

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.

Available Term Lengths

3 to 5 years

Fees

  • Origination fee: 1% to 6%

  • Late fee: Greater of $15 or 5% of payment after 15-day grace period.

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 8.05% 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 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.
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Our pick for

Secured and co-signed loans

OneMain

on OneMain Financial's website

OneMain Financial

4.0

NerdWallet rating 
OneMain

Min. Credit Score

None

Est. APR

18.00 - 35.99%

Loan Amount

$1,500 - $20,000

on OneMain Financial's website


Min. Credit Score

None

Key facts

OneMain is an option for bad-credit borrowers, but it comes with high starting rates and an origination fee.

Pros

  • Option to choose your payment date.

  • Offers joint and secured loans.

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

  • Offers online educational resources.

Cons

  • Rates are high compared to other online lenders.

  • Charges origination fee.

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

Qualifications

  • Minimum credit score: None.

  • Minimum income: Not disclosed; average is $45,000.

Available Term Lengths

2 to 5 years

Fees

  • Origination fee: $25 to $400 or 1 - 10%

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 $400. 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: Iowa: $8,500. Maine: $7,000. Mississippi: $7,500. North Carolina: $7,500. New York: $20,000. West Virginia: $14,000. An unsecured loan is a loan which does not require you to provide collateral (such as a motor vehicle) to the lender.
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Our pick for

Small loans

Oportun

on Oportun 's website

Oportun

3.0

NerdWallet rating 
Oportun

Min. Credit Score

None

Est. APR

19.90 - 35.99%

Loan Amount

$300 - $10,000

on Oportun 's website


Min. Credit Score

None

Key facts

Oportun offers small loans at rates that are lower than payday loans, but still high. Fixed payments help you establish credit.

Pros

  • Soft credit check with pre-qualification.

  • Offers co-sign, joint and secured loan options.

  • Accepts borrowers new to credit.

  • Offers small loans starting at $300.

Cons

  • Available in a limited number of states.

  • Borrowers cannot choose or change their payment date.

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

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

Qualifications

  • Valid identification.

  • Proof of income.

  • Proof of address.

  • Up to four references.

  • Be 18 years or older.

Available Term Lengths

6 to 46 months

Fees

  • Origination fee: $0 - $300.

  • Late fee: Fixed amount or percent, $15 max.

Disclaimer

Loans subject to credit approval and may include an origination fee. Monthly payment options may not be available; Biweekly and semi-monthly payment options are standard. For example, a $5,000 loan in California would have 66 biweekly payments of $119 over 30 months at a 37.6% APR. Terms may vary by applicant and state and are subject to change. To apply, you must be at least 18 years old, must reside within our service area (AZ, CA, FL, ID, IL, MO, NJ, NM, NV, TX, UT and WI) and must not have applied for a loan with us during the past 90 days. While a prior credit history is not required to qualify, Oportun will request and consider credit checks for all applicants. California loans made pursuant to a California Financing Law License. For loans made in other states and for other information, visit oportun.com, which includes our state licenses. This is an advertisement for a consumer loan. ©2020 Oportun, Inc. All rights reserved.
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Bad-credit loan rates, amounts, terms

Borrowers with bad credit can expect rates at the high end of a lender’s range. Most lenders have a minimum credit score requirement, but some weigh additional factors — like your monthly cash flow or occupation — when deciding how much to lend you and what rate to charge.

Rates

Annual percentage rates on personal loans generally range from 6% to 36%; rates on bad-credit loans can be above 20%. In 2020, bad-credit borrowers who pre-qualified for a personal loan using NerdWallet received APRs between 26.7% and 32.4%. The rate you get on a loan depends on many factors, not just your credit score.

Amounts

Personal loan amounts for consumers with low credit scores typically range from $1,000 to $50,000. Few online lenders offer loan amounts below $1,000, and not everyone qualifies for the largest loans. Borrowers with consistent income and a credit history of regular on-time payments may qualify for higher loan amounts.

Terms

To repay your loan, you typically make monthly payments over a period of two to five years. In some cases, a lender may allow bi-weekly payments. A longer term gives you lower monthly payments, but you’ll pay more interest over the lifetime of the loan.

Bad-credit loan example

A $2,000 loan with a 28.7% APR repaid over 12 months would require monthly payments of $194, according to NerdWallet’s personal loan calculator. You’d pay $328 in total interest on that loan.

How to compare bad-credit loans

Here are five things to look for when comparing bad-credit loans:

  1. Affordable rates: Look for a lender that caps rates at 36%, which is the maximum that consumer advocates consider to be affordable. There are online lenders that offer no-credit-check loans at rates above 36%, but we recommend you consider these only as a last resort, after you’ve ruled out alternatives. (See our list of alternatives below.)

  2. Credit reporting: Find a lender that reports your payments to at least one of the three major credit bureaus. Ideally, a lender will report to all three, ensuring that on-time payments help you build credit and qualify for lower rates in the future.

  3. Fast funding: If you need money quickly, an online loan may be your best option. Online lenders can often fund a loan the day after you’re approved, if not the same day. Some banks and credit unions may also fund a loan quickly if you’re already a customer.

  4. Easy application: Online applications typically take a few minutes to complete. Pre-qualifying with an online lender can be a simple way to see your rates and loan terms without affecting your credit score.

  5. Perks: Some lenders have features that help you build your credit, like free access to your credit score. A lender may also offer free financial education on their website.

How to get approved for a bad-credit loan

Here are steps you can take to improve your application and potentially qualify for the loan you want.

Check your credit report. Is a credit reporting error keeping your credit score low? You can review your credit report for any incorrectly reported delinquencies or accounts that aren’t yours. Remedying these kinds of issues before you apply can improve your chances of qualifying.

Add a co-signer or co-borrower. Adding someone with better credit may boost your chances of qualifying since the lender will consider both applicants’ credit and income to make a decision. Keep in mind that whoever you add is on the hook for the loan if you fail to make payments.

Add collateral. You may be approved more easily or get a lower rate with a secured loan. Online lenders like OneMain, Upgrade and Oportun let borrowers secure a loan with collateral — typically a vehicle — while credit unions and some banks offer loans secured with savings or CD accounts. If you can’t repay the loan, though, the lender can take the collateral.

Bad-credit loan alternatives

Personal loans are one option if you need fast cash, but you may have access to cheaper alternatives.

Friend or family loan: Borrowing from a friend or family member takes your credit score out of the equation. You can draw up a contract and agree to repayment terms. Try to discuss how you both can keep the relationship intact once you’ve mixed in money.

Charity or nonprofit: If you’re having a hard time covering everyday expenses like groceries, gas and housing — or if an expensive emergency comes up — a local charity may be able to help. These organizations may provide assistance with food or rent, or offer small, interest-free loans.

Credit-builder loan: If you’re trying to build credit and don’t need money right away, a credit-builder loan is a safe option. These loans are typically offered by credit unions and community banks and require you to have an income that supports monthly payments.

Side gig: There are legitimate ways to make extra cash, no matter how quickly you need it. From babysitting and selling your gently used clothes to becoming an influencer and creating for Etsy, you may be able to find another way to bring in extra money.

Lending circles: You can form a lending circle with a group of people you trust. Everyone contributes some amount of money, which is then pooled and distributed to one circle member every month or so. In some cases, contributions are reported to help build credit. It isn’t the fastest option, but it’s one way friends or family can help each other.

How to choose a bad-credit lender

NerdWallet has reviewed more than 30 lenders to help you compare and choose one that’s right for you. Here are lenders that offer bad-credit online loans:

Upgrade

Upgrade personal loans seem tailor-made for debt consolidation, even though you can use the loans for almost any expense. The lender will not only send your loan proceeds directly to your creditors to pay off your balances, but it may also discount your rate for choosing this option.

Upgrade

NerdWallet rating

Loan amount

$1,000 - $50,000

Minimum credit score

580

Other qualifying data

Free cash flow.

Fees

  • Origination: 2.9% - 8%.

  • Late: Up to $10.

  • Less-than-full payment: $10.

Funding time

One business day.

Upstart

Upstart stands out among bad-credit lenders because of its sophisticated underwriting model. The lender takes non-credit data  —  like college education and residence — into account when reviewing a loan application. This model may help young applicants with thin credit histories or lower credit scores but higher earning potential qualify for a loan.

Upstart

NerdWallet rating

Loan amount

$1,000 - $50,000

Minimum credit score

580

Other qualifying data

Earning potential, college education, job history, residence, other alternative data.

Fees

  • Origination: Up to 8%.

  • Late: Greater of 5% of payment or $15.

  • Returned/failed payment: $15.

Funding time

One business day.

Avant

Avant can fund a loan as quickly as the business day after an application is approved. It has competitive rates for bad-credit borrowers and allows you to change your pay date as often as you need to. You can refinance an Avant loan or a loan from another lender to get a potentially lower rate.

Avant

NerdWallet rating

Loan amount

$2,000 - $35,000

Minimum credit score

550

Other qualifying data

Income, existing debts.

Fees

  • Origination: Up to 4.75%.

  • Late: $25.

  • Unsuccessful payment: $15 in most states.

Funding time

One to three business days.

LendingClub

LendingClub has a loan specifically designed for credit card consolidation. Borrowers can consolidate debt from up to 12 credit cards. You can add a co-signer or co-borrower to a LendingClub application.

LendingClub

NerdWallet rating

Loan amount

$1,000 - $40,000

Minimum credit score

600

Other qualifying data

Credit history, debt-to-income ratio.

Fees

  • Origination: 1% to 6% of the loan amount.

  • Late: Greater of 5% of unpaid installment amount or $15.

Funding time

A few days to a week.

OneMain Financial

OneMain doesn’t have a minimum credit score requirement, instead prioritizing ability to repay and overall credit stability. This lender offers joint loans and vehicle-secured loans, which may help borrowers qualify or get a lower APR.

OneMain

NerdWallet rating

Loan amount

$1,500 - $20,000

Minimum credit score

None

Other qualifying data

Ability to repay, credit stability, collateral.

Fees

  • Origination: $25 - $400 or 1% - 10%, depending on state.

  • Late: $5 - $30 or 1.5 - 15% of payment depending on state and loan.

  • Nonsufficient funds: $10 - $50.

Funding time

Same day if approved by noon.

Oportun

Oportun operates in only 12 states; however, this lender can loan as little as $300. This lender doesn’t require a credit score to apply but your score will be considered on an application if you have one.

Oportun

NerdWallet rating

Loan amount

$300 - $10,000

Minimum credit score

None

Other qualifying data

Income and cash flow, payments toward utility and cell phone bills.

Fees

  • Origination: $0 - $300.

  • Late: May be a fixed amount or percent, no higher than $15.

Funding time

Same or next day.

Last updated on February 2, 2021

Methodology

NerdWallet's ratings for personal loans award points to lenders that offer consumer-friendly features, including soft credit checks, no fees, transparency of loan rates and terms, flexible payment options, accessible customer service, reporting of payments to credit bureaus and financial education. We also consider the number of complaints filed with agencies like the Consumer Financial Protection Bureau. This methodology applies only to lenders that cap interest rates at 36%, the maximum rate financial experts and consumer advocates agree is the acceptable limit for a loan to be affordable. NerdWallet does not receive compensation of any sort for our reviews.

To recap our selections...

NerdWallet's Best Bad Credit Loans of March 2021

Frequently asked questions