It's possible to get a loan even if you have bad credit. While your credit rating will prevent you from accessing certain types of loans, there are still options available for those with a low credit score. If your credit scores fall below a certain limit, the lender is less likely to approve a loan. However, if your ratings are above that mark, the lender can then consider other factors such as your debt-to-income ratio when deciding whether to offer you a loan and at what interest rate.
Unsecured personal loans are the most popular type of loan for those with bad credit. These loans allow people with a poor credit history or no credit history to borrow a certain amount of money and repay it, plus interest, in fixed monthly payments over the life of the loan. Car loans are another option for those with bad credit. These are secured loans that use your car as collateral, meaning that the lender can take possession of your car if you fail to make payments or miss payments.
There are car lenders who work with people who have bad credit, but they typically charge high fees. The best lenders with bad credit offer an affordable rate and other useful features such as credit-building tools, quick financing, or a mobile application to manage loan payments. This can be beneficial if you want to extend or shorten the repayment term, apply for a larger loan, or see if you may qualify for a lower interest rate. Payday, title and pawnshop loans are some of the easiest types of loans to get with bad credit since they don't require a credit check.
However, these types of loans come with high interest rates and fees and should be avoided if possible. Avant is one of the best installment loans for bad credit with a low opening fee. LendingPoint also offers an opening fee as low as 0%, although it is unlikely that someone with bad credit will receive the lowest commission. Avant will use a soft credit check to see if you are likely to qualify for a loan (a firm inquiry will be sent if you decide to continue).
To determine which personal loans are best for consumers with bad credit, Select looked at dozens of U. S.-based lenders and evaluated them based on their eligibility criteria, fees, customer service, and more.