Most lenders consider someone with a score lower than 580 as having bad credit. However, it is still possible to get a personal loan! you can look for lenders that offer personal loans for bad credit borrowers, such as:
Upstart uses a different approach than looking at a credit score to determine a borrower’s risk. OppLoans does not have a minimum credit score and looks at your bank information to establish if you can pay your loan. Finally, Monevo is a one-stop-shop for several lenders that accept credit scores as low as 450.
While you may get a loan from one of these lenders, your interest rate will likely be higher than someone with excellent credit. Other options for getting a personal loan with bad credit:
Secured loans – You can apply for unsecured or secured personal loans. Unsecured loans do not require any collateral. Secured loans connect to something of value in case you fail to make your payments.
For example, you might use a vehicle’s title as collateral to secure a loan. If you stop paying your lender, they have the right to seize your vehicle.
Co-signer – If you have poor credit or no credit at all, you can lean on someone else’s credit to secure a loan. A co-signer takes on the responsibility of the loan with you.
A co-signer with good credit can mean a lower rate or better terms for your loan. Making on-time payments will also increase your credit score. However, if you do not make your payments, you can hurt the co-signer’s credit.
One of the worse types of loans you can get is a payday loan. Even though they cater to those with poor credit, their interest rates can be around 300 percent with terms of just weeks to pay back. It is easy to fall into a high-interest trap that can ruin your credit even more.