Having a poor credit score can make it difficult to get a loan, but it's not impossible. Secured, co-signed and joint loans are the easiest to obtain with bad credit. A secured loan requires collateral, such as a car or savings account, that the lender can take if you don't pay. A co-signed or joint loan requires that you add someone with a better income and credit than you to the application.
Alternative payday loans are short-term loans available at some federal credit unions and usually have much lower annual fees and percentage rates than typical payday loans. Low credit rating requirement of 580. Relatively high APR range, 9.95% to 35.95%. LendingPoint charges a relatively low opening fee, 3.5% on average, and borrowers benefit from very few fees and no prepayment penalties.
Low Credit Score Requirement (580). Eligible borrowers with credit scores as low as 580 may also qualify for personal loans from LendingPoint. While LendingPoint offers some unique benefits, it doesn't allow co-borrowers or co-signers, so borrowers will need to qualify for a loan based on their own creditworthiness. LendingPoint also doesn't offer the option of sending loan funds directly to creditors, something that many other lenders do. When you have a FICO score lower than 670, you are considered a high-risk borrower.
If your FICO score is lower than 580, your credit is in the bad range. If you know someone with good credit, ask them about co-signing a loan with bad credit. With a qualified co-signer, the lender will set the terms of the loan based on the credit rating of the person with good credit, who will then be equally responsible for the repayment. The process of approving bad credit loans can be very difficult, but a little patience and diligent research will pay off with a loan you can afford. Use Bankrate's personal loan calculator to estimate monthly payments and review your budget to draw up a repayment plan.
Prospective borrowers publish a list of loans on several peer-to-peer websites, indicating the amount needed and what it's for. Prequalification allows you to find out if you're likely to qualify for a loan. Loans will be charged an opening fee of 2.9% to 8.0%, which will be deducted from the loan proceeds. The unfortunate reality of applying for a loan with a lower than ideal credit score is that you'll pay more than someone with a higher credit score. Since people with poor credit ratings are considered riskier, make sure you're clear about exactly what you'll pay to get the loan. We have maintained this reputation for more than four decades by demystifying the financial decision-making process and giving people confidence in the actions to take next.
However, these campaigns usually announce an introductory or “teaser” fee that will increase when the limited-time offer expires. If you don't have a plan to pay quickly, rates can skyrocket to the range of 20 to 30 percent, which is probably much higher than the rate you can qualify for with a reputable lender. The good news is that there are different types of loans for people with bad credit. The bad news? There are also lenders who take advantage of people with bad credit and offer financing on very unfavorable terms that could trap applicants in a cycle of debt. We chose LendingPoint as our main lender in this category because it has relatively low opening fees and has no prepayment penalties. The upgrade is highly available across the country and its current APR range, from 7.46% to 35.97%, is competitive.
You can get a rate at the lower end of the range if approved by a co-applicant who has excellent credit, signs up for automatic repayment, and uses the proceeds to directly pay existing debt. Here are the best features that can help lower the cost of your loan: Like most lenders, it doesn't charge a prepayment penalty; it offers competitive APRs; it has no hidden fees; and it allows borrowers to prequalify without affecting their credit score. Getting a personal loan while you have bad credit is more difficult and more expensive than getting a personal loan with excellent credit. This is why it should definitely be your last resort when looking for financing options.