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Personal Loans for Fair Credit: Best for August 2019

Steve NicastroAugust 1, 2019

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Compare rates and terms at online lenders offering personal loans to borrowers with fair credit.

Our picks for

Personal loans for fair or average credit

LendingClub and Prosper offer comparable loan terms and rates. You’ll need stronger credit to qualify for Prosper, which provides faster funding than LendingClub.

Lending Club

on Lending Club's website

on Lending Club's website

Min. Credit Score

600

Est. APR

6.95-35.89%

Loan Amount

$1,000-$40,000

Pros

  • Offers a loan option with direct payment to creditors.
  • Co-sign option.
  • Offers hardship plan.

Cons

  • Charges origination and late fees.
  • No rate discount for autopayments.
Read full review

Qualifications

  • Minimum credit score of 600.
  • Minimum credit history of 3 years.
  • Debt-to-income ratio of less than 40% for single applications, 35% for joint applicants.

Available Term Lengths

  • 3 to 5 years

Fees

  • Origination fee: 1% - 6%.
  • Late fee: Greater of $15 or 5% of payment after 15-day grace period.
  • Check processing fee: $7.

Disclaimer: *All loans made by WebBank, Member FDIC. Your actual rate depends upon credit score, loan amount, loan term, and credit usage & history. The APR ranges from 6.95% to 35.89%. The origination fee ranges from 1% to 6% of the original principal balance and is deducted from your loan proceeds. For example, you could receive a loan of $6,000 with an interest rate of 7.99% and a 5.00% origination fee of $300 for an APR of 11.51%. In this example, you will receive $5,700 and will make 36 monthly payments of $187.99. The total amount repayable will be $6,767.64. Your APR will be determined based on your credit at the time of application. The average origination fee is 5.49% as of Q1 2017. In Georgia, the minimum loan amount is $3,025. In Massachusetts, the minimum loan amount is $6,025 if your APR is greater than 12%. There is no down payment and there is never a prepayment penalty. Closing of your loan is contingent upon your agreement of all the required agreements and disclosures on the www.lendingclub.com website. All loans via LendingClub have a minimum repayment term of 36 months. Borrower must be a U.S. citizen, permanent resident or be in the United States on a valid long term visa and at least 18 years old. Valid bank account and Social Security number are required. Equal Housing Lender. All loans are subject to credit approval. LendingClub’s physical address is: 595 Market St suite 200 San Francisco Ca 94105. **Based on approximately 60% of borrowers who received offers through LendingClub’s marketing partners between January 1, 2018 to July 20, 2018. The time it will take to fund your loan may vary.

Prosper

on Prosper's website

on Prosper's website

Min. Credit Score

640

Est. APR

6.95-35.99%

Loan Amount

$2,000-$40,000

Pros

  • Check your rate with a soft credit check.
  • Fast funding.

Cons

  • Origination and late fees.
  • Does not offer direct payoff to creditors for debt consolidation loans.
Read full review

Qualifications

  • Minimum credit score: 640, but average is 710.
  • Minimum credit history: Two years, but average is 11.
  • Minimum annual income: None, but average is $89,000.
  • Maximum debt-to-income ratio: 50% (excluding mortgage).

Available Term Lengths

  • 3 to 5 years

Fees

  • Origination fee: 2.4% - 5%.
  • Late fee: $15 or 5% of unpaid amount (whichever is greater).
  • Insufficient funds fee: $15.

Disclaimer: For example, a three-year $10,000 loan with a Prosper Rating of AA would have an interest rate of 5.31% and a 2.41% origination fee for an annual percentage rate (APR) of 6.95% APR. You would receive $9,759 and make 36 scheduled monthly payments of $301.10. A five-year $10,000 loan with a Prosper Rating of A would have an interest rate of 8.39% and a 5.00% origination fee with a 10.59% APR. You would receive $9,500 and make 60 scheduled monthly payments of $204.64. Origination fees vary between 2.41%-5%. APRs through Prosper range from 6.95% (AA) to 35.99% (HR) for first-time borrowers, with the lowest rates for the most creditworthy borrowers. Eligibility for loans up to $40,000 depends on the information provided by the applicant in the application form. Eligibility is not guaranteed, and requires that a sufficient number of investors commit funds to your account and that you meet credit and other conditions. Refer to Borrower Registration Agreement for details and all terms and conditions. All loans made by WebBank, member FDIC.

Our picks for

Fair-credit loans for debt consolidation

If you have fair credit and want to consolidate multiple high-interest debts into one new loan at a lower rate, Avant, FreedomPlus and Upgrade offer debt consolidation loans.

Avant

on Avant's website

on Avant's website

Min. Credit Score

580

Est. APR

9.95-35.99%

Loan Amount

$2,000-$35,000

Pros

  • Low minimum credit score.
  • Refinancing option.
  • No prepayment fee.

Cons

  • No co-sign or secured loan option.
  • Does not offer direct payment to creditors for debt consolidation loans.
Read full review

Qualifications

  • Minimum credit score of 580.
  • At least $20,000 in gross annual income.

Available Term Lengths

  • 2 to 5 years

Fees

  • Administrative fee: 4.75%.
  • Late fee: $25 (most states).
  • Unsuccessful payment fee: $15 (most states).

Disclaimer: Example: 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. The actual rate and loan amount that a customer qualifies for may vary based on credit determination and other factors. Avant branded credit products are issued by WebBank, member FDIC.

FreedomPlus

on FreedomPlus's website

on FreedomPlus's website

Min. Credit Score

640

Est. APR

5.99-29.99%

Loan Amount

$7,500-$40,000

Pros

  • Low starting rates.
  • Co-sign option.
  • Directly pays creditors for debt consolidation loans.

Cons

  • May charge origination fee.
  • Minimum loan amount of $7,500.
Read full review

Qualifications

  • Minimum credit score of 640.
  • At least $40,000 in annual income.
  • Debt-to-income ratio of less than 40%. Average borrowers have a DTI of 20%.

Available Term Lengths

  • 2 to 5 years

Fees

  • Origination fee: 0.0% - 5.0%.
  • Late fee: $15 or 5% of amount due, whichever is greater.
  • Unsuccessful payment fee: $15.

Disclaimer: All loans available through FreedomPlus.com are made by Cross River Bank, a New Jersey State Chartered Commercial Bank, Member FDIC, Equal Housing Lender. All loan and rate terms are subject to eligibility restrictions, application review, credit score, loan amount, loan term, lender approval, and credit usage and history. Eligibility for a loan is not guaranteed. Loans are not available to residents of all states – please call a FreedomPlus representative for further details. The following limitations, in addition to others, shall apply: FreedomPlus does not arrange loans in: (i) Arizona under $10,500; (ii) Massachusetts under $6,500, (iii) Ohio under $5,500, and (iv) Georgia under $3,500. Repayment periods range from 24 to 60 months. The range of APRs on loans made available through FreedomPlus is 5.99% to a maximum of 29.99%. APR. The APR calculation includes all applicable fees, including the loan origination fee. For Example, a four year $20,000 loan with an interest rate of 15.49% and corresponding APR of 18.34% would have an estimated monthly payment of $561.60 and a total cost payable of $7,948.13. To qualify for a 5.99% APR loan, a borrower will need excellent credit on a loan for an amount less than $12,000.00, and with a term equal to 24 months. Adding a co-borrower with sufficient income; using at least eighty-five percent (85%) of the loan proceeds to directly pay off qualifying existing debt; or showing proof of sufficient retirement savings, could help you also qualify for the lowest rate available.

Upgrade

on Upgrade's website

on Upgrade's website

Min. Credit Score

620

Est. APR

7.99-35.89%

Loan Amount

$1,000-$50,000

Pros

  • Credit health tools.
  • Hardship plans.
  • Fast funding.

Cons

  • Origination and late fees.
  • Does not offer direct payment to creditors for debt consolidation loans.
Read full review

Qualifications

  • Minimum credit score: 620.
  • Minimum annual income: None, but most applicants have more than $30,000.
  • Minimum monthly free cash flow: $800.
  • Maximum debt-to-income ratio: 60%.
  • Unavailable to borrowers in: Colorado, Connecticut, Iowa, Maryland, Vermont or West Virginia.

Available Term Lengths

  • 3 to 5 years

Fees

  • Origination fee: 1.5% - 6%.

Disclaimer: Your loan terms are not guaranteed and are subject to our verification and review process. You may be asked to provide additional documents to enable us to verify your income and your identity. This rate includes an Autopay APR reduction of 0.5%. By enrolling in Autopay your payments will be automatically deducted from your bank account. Selecting Autopay is optional. Annual Percentage Rate is inclusive of a loan origination fee, which is deducted from the loan proceeds. Late payments or subsequent charges and fees may increase the cost of your fixed rate loan. All loans made by WebBank, member FDIC. Please refer to Upgrade's Terms of Use and Borrower Agreement for all terms, conditions and requirements.

Our pick for

Fair-credit loans for short credit history

For borrowers with fair credit and short or "thin" credit histories, Upstart considers factors such as education and employment when approving loans.

Upstart

on Upstart's website

on Upstart's website

Min. Credit Score

620

Est. APR

7.69-35.99%

Loan Amount

$1,000-$50,000

Pros

  • Accepts borrowers new to credit.
  • Fast funding.

Cons

  • Origination and late fees.
  • No secured or co-sign option.
Read full review

Qualifications

  • Minimum credit score: 620.
  • Minimum credit history: None.
  • Minimum annual income: $12,000.
  • Max debt-to-income ratio: 45%.

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. Loans are not available in West Virginia or Iowa. 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 $5,001. The minimum loan amount in GA is $3,100. The full range of available rates varies by state. The average 3-year loan on Upstart will have an APR of 20% and 36 monthly payments of $35 per $1,000 borrowed. There is no down payment and no prepayment penalty. The average APR on Upstart 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.

Summary of Personal Loans for Fair Credit: Best for August 2019

LenderBest ForEst. APRMin. Credit ScoreLearn More
Lending Club

LendingClub

on Lending Club's website

Personal loans for fair or average credit

6.95-35.89%

600

on Lending Club's website

Prosper

Prosper

on Prosper's website

Personal loans for fair or average credit

6.95-35.99%

640

on Prosper's website

Avant

Avant

on Avant's website

Fair-credit loans for debt consolidation

9.95-35.99%

580

on Avant's website

FreedomPlus

FreedomPlus

on FreedomPlus's website

Fair-credit loans for debt consolidation

5.99-29.99%

640

on FreedomPlus's website

Upgrade

Upgrade

on Upgrade's website

Fair-credit loans for debt consolidation

7.99-35.89%

620

on Upgrade's website

Upstart

Upstart

on Upstart's website

Fair-credit loans for short credit history

7.69-35.99%

620

on Upstart's website

LenderBest ForEst. APRMin. Credit ScoreLearn More
Lending Club

LendingClub

on Lending Club's website

Personal loans for fair or average credit

6.95-35.89%

600

on Lending Club's website

Prosper

Prosper

on Prosper's website

Personal loans for fair or average credit

6.95-35.99%

640

on Prosper's website

Avant

Avant

on Avant's website

Fair-credit loans for debt consolidation

9.95-35.99%

580

on Avant's website

FreedomPlus

FreedomPlus

on FreedomPlus's website

Fair-credit loans for debt consolidation

5.99-29.99%

640

on FreedomPlus's website

Upgrade

Upgrade

on Upgrade's website

Fair-credit loans for debt consolidation

7.99-35.89%

620

on Upgrade's website

Upstart

Upstart

on Upstart's website

Fair-credit loans for short credit history

7.69-35.99%

620

on Upstart's website

» MORE: Best debt consolidation loans

How much will it cost?

As with most credit products, the rate you receive on a personal loan depends a lot on your credit score. Borrowers with fair or average credit will pay a higher rate — somewhere around 20%, according to a NerdWallet lender survey — than those with good credit. The interest rate also affects your total monthly payment, as does the term length; a longer term means lower monthly payments, but more interest.

Use our personal loan calculator to estimate your monthly payments based on your credit score.

» MORE: Best personal loan interest rates

How to qualify for fair credit loans

Focus on your credit score. Even if lenders look at other factors, your credit score is a key consideration, and building your score can mean better odds of qualifying and getting a lower rate.

Add a co-applicant or co-signer to your application. There are risks to co-signing, but it’s an option that can help you qualify for a loan that you wouldn’t be able to on your own because of fair credit or low income.

Consider a credit union. Credit unions tend to know their members and their financial histories and may offer lower rates and more flexible terms to borrowers with average credit. Federal credit unions cap interest rates at 18%.

Pre-qualify with multiple lenders. Many online lenders allow you to pre-qualify to see rates and terms you may receive. This usually involves a soft credit check, which doesn’t affect your credit score.

» MORE:  5 ways to boost your chances of qualifying

Pre-qualify for a personal loan

Most online lenders will give you preview of the rates and terms you may receive by performing a soft check of your credit. This won’t affect your credit score, so it pays to take the steps to pre-qualify for a loan with multiple lenders and compare rates and loan features. You can pre-qualify on NerdWallet and see rates from lenders that partner with us.

Last updated on August 1, 2019

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 Personal Loans for Fair Credit: Best for August 2019

  • LendingClub: Best for Personal loans for fair or average credit
  • Prosper: Best for Personal loans for fair or average credit
  • Avant: Best for Fair-credit loans for debt consolidation
  • FreedomPlus: Best for Fair-credit loans for debt consolidation
  • Upgrade: Best for Fair-credit loans for debt consolidation
  • Upstart: Best for Fair-credit loans for short credit history