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Having bad credit doesn't mean you're out of options when you need a personal loan. While traditional banks may turn you away, a growing number of online lenders specialize in working with borrowers who have less-than-perfect credit. In this guide, we'll reveal the best personal loans for bad credit in 2024, with options starting at 7.99% APR for qualified applicants.
Top 5 Personal Loans for Bad Credit
1. Upgrade — Best Overall
Upgrade offers the best combination of competitive rates, flexible terms, and fast funding for borrowers with bad credit.
Why we like it: Upgrade considers factors beyond your credit score, including income and cash flow. They offer free credit monitoring and financial education tools to help you improve your score over time.
2. Upstart — Best for Thin Credit Files
Upstart uses AI to evaluate your application, looking at education and employment history—not just credit score.
Why we like it: Upstart accepts borrowers with scores as low as 300—essentially no minimum. Their AI model can approve applicants who would be rejected by traditional lenders.
3. LendingPoint — Best for Fast Funding
Get approved in minutes and funded as soon as the next business day with LendingPoint.
Why we like it: LendingPoint specializes in near-prime borrowers and offers same-day approval decisions. Their mobile app makes managing your loan easy.
4. Avant — Best for Customer Service
Avant has built a reputation for excellent customer support and transparent lending practices.
Why we like it: Avant offers 7-day-a-week customer support and a user-friendly mobile app. They're transparent about fees and don't charge prepayment penalties.
5. OneMain Financial — Best for In-Person Service
With over 1,400 branches nationwide, OneMain is ideal if you prefer face-to-face lending.
Why we like it: OneMain doesn't have a minimum credit score requirement. They focus on your ability to repay and offer secured loan options for better rates.
Side-by-Side Comparison
| Lender | APR Range | Min. Score | Loan Amount | Funding Time |
|---|---|---|---|---|
| Upgrade | 8.49% - 35.99% | 580 | $1,000 - $50,000 | 1 day |
| Upstart | 7.99% - 35.99% | 300 | $1,000 - $50,000 | 1 day |
| LendingPoint | 7.99% - 35.99% | 600 | $2,000 - $36,500 | Next day |
| Avant | 9.95% - 35.99% | 580 | $2,000 - $35,000 | 1-2 days |
| OneMain | 18.00% - 35.99% | None | $1,500 - $20,000 | Same day |
How to Qualify with Bad Credit
Even with a low credit score, you can improve your chances of approval:
1. Check Your Credit Report First
Get free copies from all three bureaus at AnnualCreditReport.com. Dispute any errors—removing even one negative item can boost your score significantly.
2. Pre-Qualify Before Applying
Most bad-credit lenders offer pre-qualification with a soft credit pull. This lets you see your potential rate without hurting your score.
3. Show Stable Income
Lenders want to see you can repay the loan. Have pay stubs, W-2s, or tax returns ready. A debt-to-income ratio below 40% significantly improves approval odds.
4. Consider a Co-Signer
Adding a creditworthy co-signer can get you approved with better rates. Just remember—they're equally responsible for repayment.
Understanding APR Ranges
With bad credit, you'll pay higher rates. Here's what to expect:
| Credit Score Range | Typical APR Range | Estimated Monthly Payment* |
|---|---|---|
| 300 - 579 (Poor) | 25% - 36% | $295 - $361 |
| 580 - 669 (Fair) | 18% - 28% | $254 - $309 |
| 670 - 739 (Good) | 10% - 18% | $212 - $254 |
*Based on $10,000 loan over 48 months
⚠️ Watch Out for Predatory Lenders
Avoid lenders who:
- Guarantee approval regardless of credit
- Charge upfront fees before approval
- Don't disclose APR before you apply
- Pressure you to sign immediately
Alternatives to Personal Loans
If you can't qualify for a reasonable rate, consider these options:
Credit Union Loans
Federal credit unions cap personal loan rates at 18% APR. Many offer "payday alternative loans" (PALs) with rates around 28% APR for small amounts.
Secured Personal Loans
Pledge collateral (savings account, vehicle) to get better rates. OneMain and local banks offer these products.
401(k) Loans
Borrow from yourself with no credit check. Rates are typically prime + 1%, and you pay interest back to your own account. Just be aware of the risks if you leave your job.
Expert Tips for Getting Approved
💡 Pro Tips from Our Experts
- Apply to multiple lenders: Each pre-qualification is a soft pull—compare offers without hurting your credit
- Choose the shortest term you can afford: Shorter terms mean lower total interest
- Sign up for autopay: Most lenders offer 0.25% - 0.50% APR discounts
- Improve your credit first: Even a 50-point increase can save thousands in interest