BEST OF

Best Online Installment Loans for Bad Credit of December 2021

Installment loans for bad credit can be less risky and more affordable than payday loans. Beware of those that don't check your credit or charge triple-digit interest rates.

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An installment loan is money you borrow all at once and repay in fixed monthly payments, or installments, over a period of months or years.

For borrowers with low or no credit profiles, some lenders offer installment loans for bad credit (a FICO score below 630). To see if you qualify for a personal installment loan, lenders gather information about you, like how much debt you have, your monthly transactions and your income.

Approach online installment loans with a skeptical eye. Some lenders, like the ones listed here, charge affordable rates and report payments to the major credit bureaus, which can help you build credit. But others charge triple-digit APRs and don't report payments.

Here’s a list of the best online lenders offering installment loans to people with bad credit.

  • Upgrade: Debt consolidation installment loans for bad credit.

  • Upstart: Bad-credit installment loans for borrowers with thin credit histories.

  • LendingPoint: Bad-credit installment loans with fast funding.

  • Universal Credit: Bad-credit installment loans with credit-building tools.

  • OneMain: Secured or co-signed bad-credit installment loans.

  • Oportun: Bad-credit installment loans with no credit score requirement.

Summary of Best Online Installment Loans for Bad Credit of December 2021

Our pick for

Debt consolidation installment loans for bad credit

Upgrade
Check rate

on Upgrade's website

Upgrade

5.0

NerdWallet rating 
Upgrade

Est. APR

5.94-35.47%

Loan Amount

$1,000-$50,000

Min. Credit Score

560
Check rate

on Upgrade's website


Min. Credit Score

560

Key facts

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

Pros

  • Allows secured and joint loans.

  • Offers a wide range of repayment terms.

  • Offers a 0.5% rate discount for setting up autopay.

  • Offers significant rate discount for checking account customers.

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

Cons

  • Charges origination fee.

  • No co-signed loan option.

Qualifications

  • Minimum credit score: 560; borrower average is 678.

  • Minimum annual income: None; borrower average is $78,000.

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

  • Maximum debt-to-income ratio: Less than or equal to 75%, including mortgage and calculating in your new personal loan.

Available Term Lengths

2 to 7 years

Fees

  • Origination fee: 2.9% to 8%.

Disclaimer

Personal loans made through Upgrade feature APRs of 5.94%-35.47%. 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

Bad credit installment loans with credit building tools

Universal Credit
Check rate

on Universal Credit's website

Universal Credit

4.5

NerdWallet rating 
Universal Credit

Est. APR

8.93-35.43%

Loan Amount

$1,000-$50,000

Min. Credit Score

560
Check rate

on Universal Credit's website


Min. Credit Score

560

Key facts

A Universal Credit loan is an option for bad-credit borrowers with high debt-to-income ratios, but rates are high compared to similar lenders.

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.

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.

Available Term Lengths

3 to 5 years

Fees

  • Origination fee: 4.25% to 8%.

  • Late fee: Up to $10.

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.

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Our pick for

Bad credit installment loans for borrowers with thin credit histories

Upstart
Check rate

on Upstart's website

Upstart

4.5

NerdWallet rating 
Upstart

Est. APR

5.38-35.99%

Loan Amount

$1,000-$50,000

Min. Credit Score

None
Check rate

on Upstart's website


Min. Credit Score

None

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.

  • 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.

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.

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 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.

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Our pick for

Bad credit installment loans with fast funding

LendingPoint
Check rate

on LendingPoint's website

LendingPoint

4.0

NerdWallet rating 
LendingPoint

Est. APR

9.99-35.99%

Loan Amount

$2,000-$36,500

Min. Credit Score

580
Check rate

on LendingPoint's website


Min. Credit Score

580

Key facts

LendingPoint accepts low credit scores and has flexible payments. Rates are high but comparable to competitors.

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.

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%.

Available Term Lengths

2 to 4 years

Fees

  • Origination fee: 0% - 6%.

  • Late fee: $30 after 15-day grace period.

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.

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Our pick for

Secured or co-signed bad credit installment loans

OneMain
Check rate

on OneMain Financial's website

OneMain Financial

4.0

NerdWallet rating 
OneMain

Est. APR

18.00-35.99%

Loan Amount

$1,500-$20,000

Min. Credit Score

None
Check rate

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 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.

Qualifications

  • Minimum credit score: None.

  • Minimum income: None; 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 $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.

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Our pick for

Bad credit installment loans with no credit score required

Oportun
Check rate

on Oportun's website

Oportun

3.0

NerdWallet rating 
Oportun

Est. APR

27.74-35.95%

Loan Amount

$300-$10,000

Min. Credit Score

None
Check rate

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 and limited secured loan options.

  • Accepts borrowers new to credit.

  • Offers small loans starting at $300.

Cons

  • Borrowers cannot change their payment date.

  • Doesn't offer direct payment to creditors with debt consolidation loans.

  • No joint loan option.

  • Loans are expensive compared to other bad-credit options.

  • Reports to only 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.

  • At least $500 in monthly income.

Available Term Lengths

12 to 51 months

Fees

  • Origination fee: $0 - $300.

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

Disclaimer

This is an advertisement for a consumer loan, subject to credit eligibility. Not available in CO, DC, GA, HI, IA, MA, MD, ME, NY, and WV. Loans in AZ, CA, FL, ID, IL, MO, NJ, NM, TX, UT, and WI are originated by Oportun Inc. California loans made pursuant to a California Financing Law license. NV loans originated by Oportun, LLC. In all other states, loans are originated by MetaBank, N.A., member FDIC. Terms, conditions, and state restrictions apply. See oportun.com for details.

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Our pick for

Bad credit installment loans that help build savings

SeedFi Borrow & Grow Personal Loan
Check rate

on SeedFi's website

SeedFi Borrow & Grow Personal Loan

4.5

NerdWallet rating 
SeedFi Borrow & Grow Personal Loan

Est. APR

6.95-29.99%

Loan Amount

$1,200-$7,000

Min. Credit Score

520
Check rate

on SeedFi's website


Min. Credit Score

520

Key facts

SeedFi’s personal loan offers emergency cash to bad-credit borrowers at an affordable rate, but charges interest to build savings.

Pros

  • Soft credit check to pre-qualify.

  • Reports payments to the three major credit bureaus.

  • No origination or prepayment fees.

  • Returns late fees at the end of the loan.

  • Able to fund a loan within 1 - 2 business days.

Cons

  • No co-signed or joint loan option.

  • No option to choose your payment date."

Qualifications

  • Verifiable income.

  • An active bank account.

  • A Social Security number or individual taxpayer identification number.

  • Minimum credit score: 520; borrower average is 600. Those with no credit score can also apply.

  • Annual net income: $10,000; borrower average is $54,000.

  • Debt-to-income ratio: None required; borrower average is 20%.

  • Average monthly free cash flow: No minimum required; borrower average is $2,000.

Available Term Lengths

8 to 44 months

Fees

  • Origination fee: None.

  • Prepayment fee: None.

  • Late fee: $15 added to the savings account.

Read Full Review

Credit union installment loans for bad credit

In addition to online lenders, consider a credit union for installment loans if you have bad credit. Rates at federal credit unions are typically lower, and they offer payday alternative loans geared toward bad-credit borrowers.

You have to become a member to get a credit union loan. Generally, credit unions use a hard credit pull to see if you qualify, which will temporarily knock a few points off your score.

First Tech Federal and Navy Federal, as well as local credit unions, are options worth exploring if you have bad credit.

How to choose an installment loan

Compare annual percentage rates. A loan’s cost is often expressed as an annual percentage rate, which includes the interest rate plus any fees. Look for the lowest APR you can find — the most consumer-friendly personal loans have rates below 36%.

Understand fees. Some lenders charge an origination fee, which is usually 1% to 10% of the loan amount, or late fees. Don’t agree to borrow money before the lender discloses all fees.

Check monthly installments. You can calculate your monthly payments based on the term length you choose. The longer your loan term, the more you’ll pay in interest. Look for a repayment term short enough to avoid overpaying on interest but long enough to make the payments manageable.

Pre-qualify. One simple way to find out if you qualify for a bad-credit installment loan is to pre-qualify. During this process, you’ll fill out a short application with information about your income and the loan you want. The lender will do a soft credit pull, but your credit score won’t be affected. You’ll then see what rates, terms and loan amounts you may qualify for.

Bad-credit installment loans vs. payday loans

The defining characteristic of installment loans — that they’re paid in installments — doesn’t usually apply to payday loans. It also makes them safer than payday loans because borrowers can better manage smaller payments over time than a lump sum repaid all at once. Here are some of the differences between installment and payday loans.

Installment personal loans

Payday loans

Repaid over the course of months or years.

Repaid in full within a week or two — usually on your next payday.

APR of 36% or below, ideally.

APR can be as high as 400%.

Usually paid back online, over the phone or by check.

Lenders withdraw the money from your bank account, using either a check you wrote ahead of time or your account information.

Usually require a credit check to assess your ability to repay the loan.

Do not require a credit check.

Report on-time payments to credit bureaus to help build your credit.

Do not report on-time payments to credit bureaus to help you build credit.

High-interest installment loans

Though you’ll ideally find an installment loan with a rate below 36%, some lenders offer installment loans with APRs above 36% that are more affordable than payday loans.

Lenders offering high-interest installment loans may not check your credit, which means they’re taking on more risk. For you, that means a higher APR, sometimes up to 150% or 200%.

OppLoans, for example, doesn’t check your credit via the three major credit bureaus, but instead looks at information from an alternative credit reporting service and your bank account to decide whether to lend you money. Its APRs are higher than other lenders that rely on traditional credit information.

While these loans may be repaid in installments, they are still unaffordable for most borrowers. Think of them as a last resort when your main alternative is a payday loan.

How installment loans affect your credit

Loans can help or hurt your credit, depending on how you use them. Since many lenders report to the three major credit bureaus, an installment loan gives you the chance to improve your credit and show financial responsibility by making on-time payments.

If you miss a payment or fail to repay the loan, however, your credit score could suffer.

One way to make sure your payments are on time is to set up autopay. Many lenders offer a small APR discount — usually a fraction of a percentage point — for borrowers who use autopay.

Alternatives to bad-credit installment loans

If you have bad credit and need money quickly, explore other low-cost options.

Last updated on December 2, 2021

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. 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. 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.

To recap our selections...

NerdWallet's Best Online Installment Loans for Bad Credit of December 2021

  • Upgrade: Best for Debt consolidation installment loans for bad credit
  • Universal Credit: Best for Bad credit installment loans with credit building tools
  • Upstart: Best for Bad credit installment loans for borrowers with thin credit histories
  • LendingPoint: Best for Bad credit installment loans with fast funding
  • OneMain Financial : Best for Secured or co-signed bad credit installment loans
  • Oportun: Best for Bad credit installment loans with no credit score required
  • SeedFi Borrow & Grow Personal Loan: Best for Bad credit installment loans that help build savings

Frequently asked questions