Personal Loans If You Have Bad Credit: Best for November 2026

More on our picks for the best loans for bad credit

In addition to low minimum credit score requirements, these lenders have attractive features like next-day funding, credit-building tools, the ability to pre-qualify with a soft credit check and the option to add a co-applicant or collateral to increase your approval odds.

Learn how these lenders stand out and what to watch out for.

Upgrade: Best for rate discounts

Why we chose this lender: Upgrade offers several rate discounts, which can save you money on a personal loan. You could get a rate discount of up to 4 percentage points for letting Upgrade send your loan funds directly to your creditors if you’re using the loan to consolidate debt. Setting up auto-payments on an Upgrade personal loan could lower your loan rate by 0.5 percentage points.

You may also get a lower rate if you opt for a secured loan or refinance an existing Upgrade loan. Most lenders don’t offer as many rate discounts.

We also like that Upgrade considers non-traditional data like your bank account history and cash flow when evaluating your loan application. And it offers co-signed and secured loans, which can be easier to qualify for.

What to be aware of: You’ll need to have at least three years of credit history to qualify for an Upgrade personal loan. Upgrade charges an origination fee, which can range from 1.85% to 9.99% of your loan amount.

Upstart: Best for thin credit profiles

Why we chose this lender: While most of the lenders on this list require you to have at least a couple years of credit history, Upstart may consider your loan application even if you lack an established credit history.

We also like that Upstart considers alternative data points, like your employment history and educational background, as part of the loan approval process. Additionally, the lender provides access to credit monitoring tools.

What to be aware of: Upstart has a maximum origination fee of 12%, which is the highest among lenders on this list. It also has a late fee of either $15 or 5% of your monthly payment amount, whichever is greater, but there’s a 15-day grace period for missed payments.

Prosper: Best for joint loans

Why we chose this lender: Prosper lets you apply for a loan with a co-borrower, which can be helpful if you’re borrowing money for a shared expense, like repairs to a home you share with your significant other.

A joint loan means you share the loan and payment responsibilities with another individual. It can be easier to qualify for a joint loan, and you may get a lower rate. Prosper told NerdWallet that requirements for joint applicants may be more relaxed than those for solo applicants.

We also like that Prosper considers non-traditional data points, like cash flow and bank account transaction history, when making loan approval decisions.

What to be aware of: Prosper loans come with an origination fee that can be up to 9.99% of the loan amount. If you miss a loan payment and don’t pay within the 15-day grace period, Prosper may charge a late fee that’s the greater amount of either $15 or 5% of your monthly payment amount.

Universal Credit: Best for debt consolidation

Why we chose this lender: Universal Credit is owned by Upgrade and shares several of its features, including a rate discount of up to 4 percentage points for agreeing to send loan funds directly to your creditors to consolidate debt.

Both lenders also allow a high debt-to-income ratio, which can be helpful if you’ve got a heavy debt load that you want to consolidate. But Universal Credit stands out because it may approve you if your credit score is as low as 560, while Upgrade requires a 600 credit score.

We also like that Universal Credit offers access to Upgrade’s credit-building tools, which includes credit monitoring, a credit score simulator and custom recommendations.

What to be aware of: Universal Credit does not offer secured, co-signed or joint loans. This lender charges an origination fee that ranges from 5.25% to 9.99% of your loan amount.

Avant: Best for low-income borrowers

Why we chose this lender: Having low income won’t necessarily stop you from getting a personal loan from Avant. As long as you bring in over $1,200 a month (and meet Avant’s other loan requirements), you could qualify. Other lenders have higher income requirements or don’t disclose how much income you need to have to qualify.

We also like that Avant looks at your whole financial picture when making loan approval decisions — including factors like your cash flow and history making housing payments. Additionally, it lets you adjust your monthly payment date, and you can reach out to customer service at any hour every day of the week.

What to be aware of: Avant charges an origination fee that can be up to 9.99% of your loan amount. If you miss a payment, you’ll be charged a $25 late fee if you don’t make the payment within the lender’s 10-day grace period.

The loan rates you can expect with bad credit

Having bad credit means you may receive an annual percentage rate at the higher end of a lender's range. Borrowers with bad credit who pre-qualified with NerdWallet over the last 30 days received an average rate of 40.22%.

Over that same period, borrowers with fair credit (scores from 630 to 689) received an average rate of 26.68%.

The rate you receive may vary from the average and is also influenced by factors like your income, your existing debt and the type of loan you request. Each lender has its own unique process for determining loan rates, so the rate one lender offers may differ from what another lender offers.

Many consumer advocates say a personal loan rate shouldn’t exceed 36% to be considered affordable.

What the nerds think

Even with a higher APR, if you can afford the monthly payments, a personal loan can reduce financial stress by breaking up a necessary large expense into smaller, fixed payments. Also, making on-time loan payments each month can help boost your credit.

Nicole DowLead Writer & Content Strategist

Calculate your estimated loan costs

Before applying for a loan, use a personal loan calculator to estimate your monthly loan payment and total interest costs, based on your desired loan amount, repayment term and estimated APR.

Keep in mind, a longer repayment term can give you smaller monthly payments, but you’ll pay more in interest over the course of the loan.

For example, a $20,000 loan with a 25% APR and a three-year term will have a monthly payment of $795, and you’ll pay $8,627 in total interest. That same loan with a five-year term will give you a monthly payment of $587, but you’ll pay $15,222 in total interest.

This example shows you could save over $200 on your monthly payments, yet still end up paying nearly $7,000 more over the life of the loan.

Ideally, you should choose the shortest repayment term that gives you monthly payments you can comfortably afford.

» MORE: Compare costs between loans

Key considerations when shopping for a loan

Here are the major factors to keep in mind when you have bad credit and are looking for a personal loan.

Annual percentage rate. A loan’s APR factors in the interest rate and any origination fees. The APR is one of the best ways to compare loan costs.

Requirements. You may have a tougher time qualifying for a personal loan with bad credit, but there are lenders that accept lower scores. Narrow your search to lenders with credit score, income and other requirements you can meet.

Loan amounts and terms. Personal loan amounts typically range from about $1,000 to $50,000, with repayment terms from two to seven years. Because lenders often view lower credit as added risk, your approved loan amount may be smaller than what you request, or you may not qualify for a long repayment term.

Types of loans. Lenders often rely heavily on your credit score to determine approval for an unsecured loan. You may have a better chance of approval with a secured, co-signed or joint loan.

Additional loan features. Some lenders offer perks like rate discounts, fast funding or the ability to change a payment due date. These loan features can help you choose between two or more competitive offers.

How to apply for a personal loan

1. Check your credit

Review your credit reports from the three major credit bureaus to ensure the information is accurate and up to date. Fixing errors on your report before applying may improve your credit score and your chances of qualifying. You can get your credit reports for free on NerdWallet or at AnnualCreditReport.com.

2. Pre-qualify with multiple lenders

Many lenders offer pre-qualification, a short process that shows your likelihood of loan approval and what rate you’d receive — with no impact to your credit score. You provide information, including your desired loan amount and loan purpose, and the lender does a soft credit pull of your credit. Pre-qualify with multiple lenders to compare rates.

3. Submit your application

Once you’ve pre-qualified and chosen a loan offer, you’ll then formally apply for the loan. Most lenders require documentation to verify your income, employment and other personal information. The lender will do a hard credit check, which can cause your score to drop by a few points.

If the lender approves your loan application, you can expect to receive funds within a few days after signing the loan documents. Our top lenders listed above all offer next-day funding.

Your first payment will be due in about a month after the lender disburses funds.

» MORE: How to get a personal loan with bad credit

Watch out for scams

The lenders on this page offer legitimate personal loans. However, there are scammers that take advantage of people with low credit scores who need to borrow money.

Here are a few red flags to look out for when you're shopping for a personal loan.

Guaranteed approval. Reputable lenders dig into your finances, including your credit and income, to determine whether you can repay the loan. A lender that guarantees you can get a loan regardless of your financial situation may charge exorbitant rates and have short repayment terms that could trap you in a cycle of repeated borrowing. .

No state license. Many reputable lenders list state licenses on their websites. Avoid any lender that won’t show proof that it’s licensed to do business in your state.

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.

» MORE: How to spot a personal loan scam

Alternative borrowing options

If you need to borrow money but have bad credit, there are other options besides traditional personal loans. Be aware that some options offer smaller loan amounts or shorter repayment terms than personal loans.

Payday alternative loans

Some credit unions offer short-term, small-dollar loans known as payday alternative loans or PALs. PALs let you borrow up to $2,000 with repayment terms up to 12 months. Federal credit unions cap APRs for PALs at 28%, making them much more affordable than payday loans with annual percentage rates around 400%. But you’ll need to be a member of a credit union that offers PALs.

Buy now, pay later

“Buy now, pay later” plans are offered at many major retailers and let you break up a large purchase into smaller payments across several weeks or a few months. A popular option splits a cost into four biweekly, interest-free payments. These payment plans typically don’t require a hard credit check.

Cash advance apps

A cash advance app lets you borrow up to a few hundred dollars, which you’ll automatically repay from your next paycheck. These apps usually don’t require a hard credit pull or charge interest. Still, they might have subscription fees or fast funding fees, and they may ask for a tip.

Family loans

If there’s someone in your life willing and able to lend you money, a family loan can be a low-cost option that doesn’t require a credit check. Draw up a loan agreement to ensure both parties are on the same page about how you’ll repay the loan and any costs involved.

How we chose the best personal loans

Our team of consumer lending experts follows an objective and robust methodology to rate lenders and pick the best.

35+

Lenders reviewed

We review over 35 lenders, including major banks, top credit unions, leading digital platforms and high interest installment lenders operating across multiple states.

25+

Categories assessed

Each lender is evaluated across five weighted categories and 29 subcategories, covering affordability, eligibility, consumer experience, flexibility, and application process.

60+

Data points analyzed

Our team tracks and reassesses hundreds of data points annually, including APR ranges, fees, credit requirements, and borrower tools, ensuring up to date, accurate comparisons.

Star rating categories

We evaluate more categories than competitors and carefully weigh how each factor impacts your experience.

Affordability

25%

We review lenders’ annual percentage rate offerings and the competitiveness of each lenders’ APR range. We also assess whether a lender charges an origination fee and any opportunity for borrowers to receive a rate discount.

Customer experience

20%

We consider the experience of the consumer trying to manage a personal loan, which means accessibility of customer service representatives, whether borrowers can choose and change their payment due date, and the ability to track their loan on a mobile app.

Underwriting and eligibility

20%

We consider the rigorousness of each lender’s underwriting practices and how widely available their loans are. This category includes whether a lender does a hard credit check before providing a loan, the range of credit profiles they accept and how many states their loans are offered in.

Loan flexibility

20%

We assess how flexible lenders can be with borrowers, including whether they offer multiple loan types, personal loan amounts and repayment term options and whether they offer direct payment to creditors on debt consolidation loans.

Application process

15%

We consider the lender’s full application process, including a borrower’s ability to preview their loan offer via pre-qualification, whether basic loan information such as APR range and repayment terms are available and easy to find online and how quickly a loan can be funded after approval.

5.0

Overall score

NerdWallet’s review process evaluates and rates personal loan products from more than 35 financial technology companies and financial institutions. We collect over 60 data points and cross-check company websites, earnings reports and other public documents to confirm product details. We may also go through a lender’s pre-qualification flow and follow up with company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.

Our star ratings award points to lenders that offer consumer-friendly features, including: 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 and financial education. Our ratings award fewer points to lenders with practices that may make a loan difficult to repay on time, such as charging high annual percentage rates (above 36%), underwriting that does not adequately assess consumers’ ability to repay and lack of credit-building help. 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.

NerdWallet does not receive compensation for our star ratings. Read more about our ratings methodologies for personal loans and our editorial guidelines.

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