BEST OF

5 Best Medical Loans for Bad Credit in 2021

Bad-credit borrowers may qualify for medical loans, but interest rates may be high. See your loan options plus other ways to fund medical costs.

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A medical loan is an unsecured personal loan that you use to pay for emergency or planned medical procedures. The best options for borrowers with fair or bad credit (a FICO score below 690) may be medical loans from online lenders that consider factors beyond your credit score to qualify you.

Interest rates on bad-credit loans can be high; therefore, before you take a medical loan, it’s best to first try cheaper alternatives like a payment plan with a health care provider or a loan from a family member.

Here are NerdWallet’s top picks for lenders that offer medical loans for low-credit borrowers.

Summary of Best Medical Loans for Bad Credit in 2021

Our picks for

Medical loans for bad credit

Upgrade
Check rate

on Upgrade's website

Upgrade

5.0

NerdWallet rating 
Upgrade

Est. APR

5.44 - 35.47%

Loan Amount

$1,000 - $50,000

Min. Credit Score

580
Check rate

on Upgrade's website


Min. Credit Score

580

Key facts

Upgrade offers rate discounts and secured, co-signed and joint loan options, making it a reasonable alternative for those with low credit scores.

Pros

  • Allows secured, co-signed and joint loans.

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

  • Offers a .5% rate discount for setting up autopay.

Cons

  • Charges origination fee.

  • Charges late fee.

Qualifications

  • Minimum credit score: 580.

  • Minimum annual income: $35,000; 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 5.94%-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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Lending Club
Check rate

on LendingClub's website

LendingClub

4.5

NerdWallet rating 
Lending Club

Est. APR

8.05 - 35.89%

Loan Amount

$1,000 - $40,000

Min. Credit Score

600
Check rate

on LendingClub's website


Min. Credit Score

600

Key facts

LendingClub's strong educational resources and borrower support platform make it a good option for bad-credit borrowers seeking to build their credit.

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 fair-credit 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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Upstart
Check rate

on Upstart's website

Upstart

4.5

NerdWallet rating 
Upstart

Est. APR

6.95 - 35.99%

Loan Amount

$1,000 - $50,000

Min. Credit Score

580
Check rate

on Upstart's website


Min. Credit Score

580

Key facts

Upstart could be a good fit for new and bad-credit borrowers as it considers factors outside of credit scores like education and job history.

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

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 24.4% and 36 monthly payments of $36 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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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 accepts low credit scores, making it an option for bad-credit borrowers, but rates are high.

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 $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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Avant
See my rates

on NerdWallet's secure website

Avant

4.0

NerdWallet rating 
Avant

Est. APR

9.95 - 35.99%

Loan Amount

$2,000 - $35,000

Min. Credit Score

550
See my rates

on NerdWallet's secure website


Min. Credit Score

550

Key facts

Avant's fast funding, flexible payment options and low starting rates make it a good option for low-score borrowers.

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

  • Charges 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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Medical loans for bad credit — rates, amounts, terms

Interest rates: Annual percentage rates for personal loans typically range from 6% to 36%. Low-credit borrowers will likely receive a rate at the higher end of that range. While your credit score can play a significant factor in how lenders determine the APR you receive, some lenders that target bad-credit borrowers may consider additional criteria like education or job history.

Fees: Some lenders charge origination fees to cover the cost of processing the loan. These fees can range from 1% to 10% of the loan amount, and they’re typically deducted from your loan proceeds. Also, check for potential prepayment or late fees.

Loan amounts: Depending on the lender, personal loan amounts range from $1,000 to $50,000, and borrowers with low credit scores may not qualify for the largest amounts. Lenders disburse the loan as a lump sum, which you repay in monthly installments.

Loan terms: Loan terms — the period during which you must repay the loan — range from one to seven years. A shorter term may mean higher monthly payments, while a longer term can cost more in interest.

For example, here’s how the loan term affects a $5,000 loan with a 21% APR:

2-year loan

5-year loan

Monthly payment

$256

$135

Total interest

$1,166

$3,116

How to compare medical loans for bad credit

Affordable APRs and payments: An APR is the total cost of a loan, including interest and fees. It allows you to make an apples-to-apples comparison between loan costs. Look for lenders with rates no higher than 36%, which is the maximum that financial experts agree is affordable.

Before committing to a loan, calculate the monthly loan payment to ensure it fits into your monthly budget.

» COMPARE LENDERS: See your personal loan options

Credit reporting: Consistently making on-time payments toward your loan can help improve your credit. So, choose a lender that reports your payments to at least one major credit bureau — and preferably all three.

Funding time: Consider the amount of time it will take to receive funding. Some online lenders approve and disburse loan funds within 24 hours after approval, while others take up to a week.

Customer support: Some lenders provide support through multiple customer contact channels, while others may offer assistance only by phone or email. Consider the level of customer support you might need.

Other features: Depending on the situation, some lenders provide features like hardship plans or flexible payment options that may help if you hit a financial speed bump. They may also offer free financial education resources.

How to improve your chances for approval

Here are steps to take to increase your chances of getting approved for a bad-credit medical loan.

Check your credit. Review your credit report for any incorrect delinquencies or potential errors. Try to resolve past-due balances on your accounts since missed payments can significantly impact your credit scores.

Consider a co-signer. Adding a co-signer’s credit history and income to your application can boost your chances of getting approved — possibly with a lower rate. Just remember that whoever you add is responsible for repaying the loan if you miss payments.

Get a secured loan. While your credit score will still be a determining factor, a secured loan lowers a lender's risk and can therefore increase the likelihood of approval. Secured loans allow you to pledge an asset as collateral in return for a lower rate or larger loan amount.

Ask for the right amount. Large loan amounts mean higher monthly payments — which lenders may view as riskier. Ask only for what you need, and make any spending adjustments to ensure your payments fit comfortably into your budget.

Get pre-qualified. Most online lenders allow you to pre-qualify for a loan using a soft credit check. This means you can know if you’ll be approved without negatively impacting your credit score. Pre-qualifying also allows you to see potential loan terms, APRs, amounts and payments, so you can compare offers and choose one that gives you the amount you need with payments you can afford.

Other ways to pay medical bills

A medical loan is best considered only after you’ve tried low- or no-cost options. Here are funding alternatives to help you cover medical costs.

Payment plan: Medical providers may offer payment plans that allow you to pay a medical bill in monthly installments. Amounts and terms depend on the agreement you negotiate with the physician.

Family loan: A family loan can be a low-interest option to fund medical expenses. A successful arrangement includes a formal written agreement outlining interest and terms. Also, consider IRS guidelines and the impact a family loan can have on the relationship.

Credit union loan: Credit unions are not-for-profit organizations that may offer loans with lower interest rates and more flexible terms than online lenders. During the application process, they are also more likely to consider your overall financial picture. However, credit unions require membership, and they do not offer an option to pre-qualify — a soft credit check that doesn’t hurt your score.

CareCredit: CareCredit is a specialty credit card for financing health care expenses. CareCredit does not have a minimum credit score requirement and considers factors like income and credit history in addition to your score. Its standard APR is 26.99%, but participating physicians may offer promotional financing options like zero-interest deals, which require you to pay the balance in full by a set time to avoid interest charges.

Nonprofit or charity: The Patient Advocate Foundation and the National Organization for Rare Disorders are examples of nonprofit organizations that offer payment assistance for medical expenses like copays, medications and treatment. PAF works with insured patients who have chronic illnesses, while NORD services patients with rare diseases.

Last updated on June 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 Medical Loans for Bad Credit in 2021

  • Upgrade: Best for Medical loans for bad credit
  • LendingClub: Best for Medical loans for bad credit
  • Upstart: Best for Medical loans for bad credit
  • OneMain Financial : Best for Medical loans for bad credit
  • Avant: Best for Medical loans for bad credit

Frequently asked questions