A low credit score doesn’t lock you out of borrowing. It does, however, change the rules of the game. Lenders see a thin or damaged credit file as risk, and they price that risk into higher APRs, bigger origination fees and smaller loan amounts. The good news is that in 2026 a growing group of online lenders specifically underwrites borrowers with scores in the 500s, and some don’t set a minimum score at all.
This guide walks through the best personal loans for bad credit in the USA right now, what each lender is genuinely good at, what you can realistically expect to pay, and how to avoid the predatory lenders that target people with poor credit.
Note: Rates, fees and eligibility rules below reflect publicly listed lender information as of October 2026. Lenders update their terms often, so always confirm the current offer on the lender’s own website before you apply.
What Counts as “Bad Credit”?
On the FICO scale of 300 to 850, a score below 580 is generally considered poor, and 580 to 669 is considered fair. Many lenders treat anything under roughly 630 as “bad credit” for personal loan purposes.
Your score isn’t the only thing that matters, though. Lenders also look at:
- Income – whether you earn enough to cover the new payment
- Debt-to-income ratio (DTI) – how much of your monthly income already goes to debt
- Employment and bank history – stability and cash flow
- Collateral or a co-applicant – which can offset a weak score
That’s why two people with the same 560 score can get very different offers.
Quick Comparison: Best Bad Credit Personal Loans 2026
| Lender | Est. APR | Loan Amounts | Terms | Min. Credit Score | Best For |
|---|---|---|---|---|---|
| Upstart | 6.20% – 35.99% | $1,000 – $75,000 | 3 or 5 years (up to 7) | None | Best overall / thin credit |
| Upgrade | 7.74% – 35.99% | $1,000 – $75,000 | 2 – 7 years | 600 | Co-signed & secured loans |
| Happen Bank (formerly LendingClub) | 5.96% – 35.99% | $1,000 – $75,000 | 2 – 7 years | 600 | Flexible amounts & terms |
| Universal Credit | 11.69% – 35.99% | $1,000 – $50,000 | 2 – 5 years | 560 | Credit-building tools |
| Best Egg | 6.99% – 35.99% | $2,000 – $50,000 | 3 – 5 years | 600 | Secured loans for homeowners |
| Prosper | 8.99% – 35.99% | $2,000 – $50,000 | 2 – 6 years | 560 | Joint loans |
| Avant | 9.95% – 35.99% | $2,000 – $35,000 | 2 – 5 years | 550 | Low-income borrowers |
| OneMain Financial | ~18% – 35.99% | $1,500 – $20,000 | 2 – 5 years | None | Auto-secured loans, in-branch help |
Notice that almost every lender tops out at 35.99% APR. That’s not a coincidence: 36% is widely treated by consumer advocates as the ceiling for an affordable loan, and reputable lenders stay at or under it. With bad credit, expect your offer to land toward the higher end of these ranges.
The Best Personal Loans for Bad Credit: Detailed Reviews
1. Upstart – Best Overall for Bad or Limited Credit
Upstart is the go-to option for borrowers who don’t fit traditional underwriting. Its AI-driven model looks beyond your credit score at factors like education and employment history, and it has no minimum credit score requirement. That makes it especially useful if your score is very low or you simply don’t have much credit history.
- APR: 6.20% – 35.99%
- Loan amounts: $1,000 – $75,000
- Origination fee: Up to 12%
- Funding: Often within one business day
- Availability: All 50 states and Washington, D.C.
Watch out for: The origination fee can be steep, and Upstart offers only limited repayment term options. It also doesn’t pay creditors directly if you’re consolidating debt.
2. Upgrade – Best for Co-Signed and Secured Loans
Upgrade is one of the few major online lenders that lets you add a co-signer, which can be a game-changer if you have a family member with stronger credit. You can also secure the loan with a vehicle to improve your odds and rate.
- APR: 7.74% – 35.99%
- Loan amounts: $1,000 – $75,000
- Minimum credit score: 600
- Origination fee: 1.85% – 9.99%
- Rate discounts: Autopay, direct payment to creditors, auto-secured and existing customer discounts
Watch out for: You can’t choose your payment due date, and the origination fee is unavoidable.
3. Happen Bank (formerly LendingClub) – Best for Flexible Amounts and Terms
LendingClub rebranded as Happen Bank in June 2026, but the core product remains the same. It offers one of the widest ranges of loan sizes and terms in this category, plus next-day funding.
- APR: 5.96% – 35.99%
- Loan amounts: $1,000 – $75,000
- Terms: 2 – 7 years
- Origination fee: Up to 8%
- Rate discounts: 0.5 percentage points each for autopay and direct payment to creditors
Watch out for: Your debt-to-income ratio generally can’t exceed 40%, which can rule out borrowers already carrying heavy debt.
4. Universal Credit – Best for Credit-Building Tools
Universal Credit is owned by Upgrade and is designed for borrowers with lower scores. You get free credit score access and monitoring, plus an autopay discount that helps you stay on time—exactly the habit that rebuilds credit.
- APR: 11.69% – 35.99%
- Loan amounts: $1,000 – $50,000
- Minimum credit score: 560
- Origination fee: 5.25% – 9.99%
Watch out for: No co-signed, joint or secured options, and the origination fee floor is high. It also isn’t available in Washington, D.C.
5. Best Egg – Best Secured Loan for Homeowners
Best Egg stands out for an unusual secured option: homeowners can pledge permanent home fixtures (like built-in cabinets or light fixtures) as collateral instead of a car or savings account. Secured loans usually come with lower rates.
- APR: 6.99% – 35.99%
- Loan amounts: $2,000 – $50,000
- Minimum credit score: 600
- Origination fee: 0.99% – 9.99%
- Bonus: Pays creditors directly for debt consolidation
Watch out for: Not available in Iowa, Vermont, West Virginia or Washington, D.C., and there are no short repayment terms.
6. Prosper – Best for Joint Loans
Prosper may loosen its requirements if you apply with a co-borrower. A joint loan means you share both the funds and repayment responsibility, ideally with someone who has better credit or higher income.
- APR: 8.99% – 35.99%
- Loan amounts: $2,000 – $50,000
- Minimum credit score: 560
- Origination fee: 1% – 9.99%
Watch out for: No rate discounts, no secured or co-signed loans, and it doesn’t lend in Iowa, West Virginia or North Dakota.
7. Avant – Best for Low-Income Borrowers
Avant has one of the lowest income thresholds in the market: if you take home over $1,200 per month, you may qualify. It also funds quickly, often the next day.
- APR: 9.95% – 35.99%
- Loan amounts: $2,000 – $35,000
- Minimum credit score: 550
- Origination fee: Up to 9.99%
Watch out for: Avant isn’t available in several states, including Iowa, West Virginia, Hawaii, Maine, Massachusetts and Washington.
8. OneMain Financial – Best for Auto-Secured Loans and In-Person Service
OneMain has no stated minimum credit score and offers both unsecured loans and loans secured by a car or truck. Its large branch network is a plus if you’d rather sit down with a loan specialist than apply entirely online.
- APR: Roughly 18% – 35.99% (some sources cite starting rates as low as about 12%)
- Loan amounts: $1,500 – $20,000 (up to $30,000 in some cases)
- Terms: 24 – 60 months
- Fees: Origination fees vary by state—either a flat fee ($25 – $500) or 1% – 10% of the loan
Watch out for: The starting APR is higher than most competitors, and prequalification doesn’t show your estimated rate.
How Much Will a Bad Credit Personal Loan Actually Cost?
Expect to pay significantly more than a borrower with good credit. Borrowers with bad credit who prequalified through NerdWallet in a recent 30-day window received an average APR of about 31%.
Here’s how term length changes your total cost on a $20,000 loan at 25% APR:
| Term | Monthly Payment | Total Interest |
|---|---|---|
| 3 years | ~$795 | ~$8,627 |
| 5 years | ~$587 | ~$15,222 |
A longer term lowers your monthly payment but nearly doubles the interest you pay. Choose the shortest term you can comfortably afford.
Don’t Forget the Origination Fee
Most bad credit lenders charge an origination fee, usually deducted from your loan before you receive it. If you borrow $20,000 with a 5% fee, you’ll receive $19,000—but you still repay the full $20,000 plus interest. Always borrow with the fee in mind, and compare loans by APR, which includes both interest and fees.
How to Get Approved for a Personal Loan With Bad Credit
1. Check your credit reports first. Pull your free reports from Equifax, Experian and TransUnion at AnnualCreditReport.com. Dispute any errors—a wrongly reported late payment or collection can cost you approval.
2. Know your numbers. Calculate your debt-to-income ratio and include every income source, such as side gigs, Social Security, retirement income, alimony or child support.
3. Prequalify with several lenders. Prequalification uses a soft credit pull, so it won’t hurt your score. Check rates with three to five lenders from the list above and compare the actual APRs and monthly payments offered.
4. Strengthen your application if needed. If offers are weak or you’re denied, consider adding a co-signer or co-borrower, or offering collateral like a vehicle. These options can improve both approval odds and your rate.
5. Submit a formal application. Once you choose an offer, the lender will run a hard credit check (expect a small, temporary score dip) and ask for documents like pay stubs, bank statements and ID. Many lenders fund within one to three business days.
6. Set up autopay. It often earns a rate discount, and on-time payments are the fastest way to rebuild your credit score.
Red Flags: How to Avoid Bad Credit Loan Scams
People with poor credit are prime targets for scammers and predatory lenders. Walk away if you see any of these:
- “Guaranteed approval” or “no credit check” promises. Legitimate lenders verify your ability to repay. No-credit-check loans often carry triple-digit APRs.
- Upfront fees before funding. A real lender deducts fees from the loan—it never asks you to pay first.
- Requests for gift cards or wire transfers. No legitimate lender asks for payment this way.
- No state license. Reputable lenders display their licensing information. Verify before you share personal details.
- No clear disclosures. Under the federal Truth in Lending Act, lenders must show you the APR, total interest and total repayment amount before you sign.
- APRs above 36%. Consumer advocates generally consider rates above this level unaffordable.
Alternatives to Bad Credit Personal Loans
A personal loan isn’t always the best answer. Consider these options:
- Credit union personal loans: Federal credit unions cap personal loan APRs at 18%, far lower than most online lenders. Members with poor credit may still qualify based on their relationship with the institution.
- Payday alternative loans (PALs): Offered by some federal credit unions, PALs let you borrow up to $2,000 for up to 12 months, with APRs capped at 28%—a fraction of the roughly 400% APR typical of payday loans.
- Secured credit cards or credit-builder loans: Useful if your goal is to rebuild credit rather than cover a big expense.
- Buy now, pay later (BNPL): For specific purchases, interest-free split payments can work—just don’t stack several plans at once.
- Cash advance apps: For small, short-term gaps of a few hundred dollars, though watch for subscription and express-funding fees.
- Family loans: Potentially the cheapest option. Put the terms in writing to protect the relationship.
Frequently Asked Questions
Can I get a personal loan with a 500 credit score? Yes, though your options are narrower. Lenders like Upstart and OneMain don’t set a minimum score, and Avant accepts scores as low as 550. A co-signer or collateral will significantly improve your chances.
What’s the easiest personal loan to get with bad credit? Secured loans (backed by a car, savings or other assets) and co-signed loans are generally the easiest to qualify for, because the lender’s risk is lower.
Will applying for a loan hurt my credit score? Prequalifying uses a soft pull and has no effect. A formal application triggers a hard inquiry, which may lower your score by a few points temporarily.
How fast can I get a bad credit loan? Many online lenders, including Upstart, Upgrade, Happen Bank and Avant, can fund within one business day of approval.
Can a personal loan improve my credit? Yes. On-time payments are reported to the credit bureaus, and using a loan to pay off high-balance credit cards can lower your credit utilization—both of which can raise your score over time.
Final Thoughts
Bad credit makes borrowing more expensive, but it doesn’t make it impossible. Upstart is the strongest all-around choice for borrowers with very low scores or limited history. Upgrade and Prosper are ideal if you can bring a co-signer or co-borrower. Best Egg and OneMain work well if you have collateral, and Avant is a solid pick for lower-income borrowers.
Whichever lender you choose, the strategy is the same: prequalify with several lenders, compare APRs rather than just monthly payments, pick the shortest term you can afford, and steer clear of anyone promising guaranteed approval. Use the loan responsibly, pay on time every month, and your next loan—at a much better rate—could be just a year or two away.