It's much harder to qualify for personal loans, mortgages, credit cards and other financial products with bad credit. Lenders use your three-digit credit score to determine how likely you are to make on-time, regular payments. The higher your score, the more likely you are to be approved.
But if you have weak credit, it doesn't mean you don't have options.
Find out what qualifies as bad credit, where you can get a loan and how to improve your credit score.
Offers in this section are from affiliate partners and selected based on a combination of engagement, product relevance, compensation, and consistent availability.
6.30% - 35.99%
$1,000 to $75,000
9.95% to 35.99%
$2,000 to $35,000
What is a bad credit score?
Credit scoring models come from two main companies, FICO and VantageScore. Both use a scale from 300 to 850, but they use different formulas, meaning your score will look different depending on which company is used. Overall, lenders are more likely to utilize FICO Scores, which are used in 90% of lending decisions.
FICO
According to FICO, poor credit is anything below 580.
- Excellent: 800 to 850
- Very good: 740 to 799
- Good: 670 to 739
- Fair: 580 to 669
- Poor: 300 to 579
VantageScore
VantageScore has a slightly different scale, with poor (or "subprime") considered anything below 600.
- Excellent/Superprime: 781 to 850
- Good/Prime: 661 to 780
- Fair/Near Prime: 601 to 660
- Poor/Subprime: 300 to 600
Offers in this section are from affiliate partners and selected based on a combination of engagement, product relevance, compensation, and consistent availability.
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How to get a personal loan with bad credit
If you need financing but you have rocky credit, you still have options.
1. Take out a secured loan with collateral
Some lenders let you secure your loan with an asset, like your house, car or savings account. Because you're offering something of value to guarantee you'll make payments, they're taking on less risk. Best Egg reports that its secured loans have APRs that are, on average, 20% lower than unsecured loans. Common types of secured personal loans include:
Auto-secured loan
With an auto-secured loan, you pledge your car, truck or other vehicle as collateral and the lender places a lien on the title until you pay off the balance. For a purchase loan, the car you're buying serves as collateral, but with a personal loan, you must own the car outright.
If you default on payments, the lender has the legal right to take and sell your car. In addition to the outstanding balance, you may owe repossession fees, auction fees and a deficiency balance if it fails to sell for at least the amount you owed.
OneMain Financial and Upgrade allow borrowers to use their vehicle as collateral, as does Upstart, although only in some states.
We like that OneMain accepts borrowers with bad credit and offers secured loans and fast funding. However, its minimum APR is on the high side and the $30,000 financing maximum may be too low if you need a larger loan.
- Approves applicants with bad/fair credit
- Same-day funding available
- Can apply with collateral
- Co-applicants allowed
- High origination fee
- High minimum interest rate
- No autopay discount
- Co-signers not allowed
*You must complete a loan application and continue to meet any criteria used to select you for a loan offer. Not all applicants are approved. Loan approval and actual loan terms depend on applicant's state of residence and ability to meet OneMain Financial credit standards such as a responsible credit history, sufficient income after monthly expenses, and if applicable, availability of eligible collateral.
Not all approved applicants qualify for larger loan amounts, lower APRs, or the most favorable loan terms. For example, larger loan amounts typically require a first lien on a motor vehicle that is no more than ten years old, meets our value requirements, and is titled in applicant's name with valid insurance. APRs are generally higher on loans not secured by a vehicle.
Example Loan: A $6,000 loan with a 24.99% APR that is repayable in 60 monthly installments would have monthly payments of $176.07.
OneMain charges origination fees allowed by law. Depending on the state where the loan is opened, the origination fee may be either a flat amount or a percentage of the loan amount. Flat fees vary by state, ranging from $25 to $500. Percentage-based fees vary by state, ranging from 1% to 10% of the loan amount subject to certain state limits on the fee amount.
For information about these fees and minimum and maximum loan sizes available in certain states, visit omf.com/loanfees.
Current OneMain Customers: Loan offers presented to a consumer assume the individual has no active loan with OneMain or one of its affiliates. If a customer applies for a new loan offer, a OneMain representative will discuss available options.
Active-duty military, their spouse or dependents covered by the Military Lending Act (MLA) may not pledge any vehicle as collateral. If you are covered by the MLA, you are not eligible for secured loans.Loan proceeds cannot be used for postsecondary educational expenses as defined by the CFPB's Regulation Z such as college, university or vocational expense; for any business or commercial purpose; to purchase cryptocurrency assets, securities, derivatives or other speculative investments; or for gambling or illegal purposes.
Time to Fund Loans: Funding within one hour after loan closing through SpeedFunds® must be disbursed to a bank-issued debit card. Disbursement by check or ACH may take up to 1-2 business days after closing.
We like that Upstart considers factors besides credit score, including education, income and employment history. Co-signers aren't accepted.
- Accept applicants with bad or no credit
- Minimum APR is lower than many competitors'
- Approves personal loans up to $75,000
- Most loans are funded the next business day
- Origination fee of 0% to 10%
- Doesn't allow co-signers or co-borrowers
Savings-secured loan
With a savings-secured loan, the borrower requests an amount equal to or less than the balance in their savings or CD from the same institution. The lender places a temporary hold on that amount, but it still earns interest. (The loan interest is usually just a small percentage higher than the APY.) As you pay down the balance, the hold on your savings decreases.
First Tech Federal Credit Union provides savings-secured loans starting at $500, using your account balance as collateral, while U.S. Bank allows you to secure a personal loan with a CD. There's no origination fee and existing account holders can receive funds as quickly as the same day.
Navy Federal Credit Union members can use CDs and savings accounts as collateral with no credit check required. The interest rate is your savings share rate plus 2.00%.
We like that secured loans can be approved for up to $500,000 and borrowers are able to defer their first payment for up to 45 days. Being able to protect your finances with loan payment protection adds another layer of security.
- No origination fee.
- Co-signers are allowed.
- Funds often available the same day.
- Up to $500,000 available for secured loans.
- Membership only requires joining the Financial Fitness Association, with fee waived.
- Unsecured loans are capped at $50,000.
- Physical branches are limited to a few states.
U.S. Bank's Simple Loan is a great option for existing customers who want a small loan with no origination or late fees.
- Funds are deposited within minutes of approval
- No origination fee or late fee
- Instead of an interest rate, loans have a low borrowing fee of $6 per $100
- Must have a U.S. Bank checking account
- Low loan cap of $1,000
- Must wait 30 days between loans
Fixture-secured loan
Rather than a lien on your entire house, this kind of loan uses permanent or semi-permanent fixtures (like built-in cabinets, light fixtures or HVAC systems) as collateral. While the lender has a legal claim to the fixtures if you default, actually taking them is uncommon. However, the lien may make it impossible to sell or refinance without clearing up the balance first.
Upgrade and Best Egg both allow borrowers to use their home fixtures as collateral.
We like that Upgrade considers borrowers with fair credit and allows you to apply with a co-borrower, which can improve your odds of approval and receiving favorable rates. The maximum interest rate is on the high side, however.
- Accepts applicants with fair credit
- Approves loans of up to $75,000
- Discount for having creditors paid directly
- Funding in as little as one day*
- Accepts co-borrowers.
- High maximum interest rate
- Origination fee of up to 9.99%
- No physical branches
Why Upgrade is the best for financial literacy:
- Free credit score simulator to help you visualize how different scenarios and actions may impact your credit
- Charts that track your trends and credit health over time, helping you understand how certain financial choices affect your credit score
- Ability to sign up for free credit monitoring and weekly VantageScore updates
Best Egg Personal Loan
Annual Percentage Rate (APR)
6.99%–35.99%
Loan amounts
Up to $50,000
Terms
36 to 84 months
Credit needed
Not disclosed
Origination fee
0.99%–9.99% of the loan amount
Late fee
$15 fee if the borrower's bank account has insufficient funds
Terms apply.
Pros
- Secured loans have an average APR discount of 20% compared to unsecured loans.*
- Factors besides credit scores are considered when applying.
- Possible to get financing in as little as 24 hours.
- Vehicles and home fixtures can be used as collateral.
Cons
- The origination fee is higher than some competitors'.
- Best Egg does not allow co-signers or co-borrowers.
*The Best Egg Secured Loan is a personal loan secured using a lien against fixtures permanently attached to your home such as built-in cabinets, light fixtures, and bathroom vanities. Rest assured, your home itself will not be used as collateral.
2. Add a co-signer or co-borrower
A co-signer with good credit can greatly improve your chances of approval because they're on the hook if you default. A co-borrower has the same obligation, but also shares legal ownership of the asset purchased with the loan.
While many lenders allow co-borrowers, co-signer options are much less common for personal loans. Both SoFi and Happen Bank accept co-borrowers and claim loans can be funded as quickly as 24 hours after signing.
No origination fees required, no early payoff fees, no late fees
- No origination fees required, no early payoff fees, no late fees
- Unemployment protection if you lose your job
- DACA recipients can apply with a creditworthy co-borrower who is a U.S. citizen/permanent resident by calling 877-936-2269
- Can have more than one SoFi loan at a time (state-permitting)
- May accept offer of employment (to start within the next 90 days) as proof of income
- Co-applicants may apply
- Applicants who are U.S. visa holders must have more than two years remaining on visa to be eligible
- No co-signers allowed (co-applicants only)
Fixed rates from 8.74% APR to 35.49% APR. APR reflect the 0.25% autopay interest rate discount and a 0.25% SoFi Plus interest rate discount. SoFi Platform personal loans are made either by SoFi Bank, N.A. or, Cross River Bank, a New Jersey State Chartered Commercial Bank, operating from its Delaware branch, Member FDIC, Equal Housing Lender. SoFi may receive compensation if you take out a loan originated by Cross River Bank. These rate ranges are current as of 02/23/26 and are subject to change without notice. Not all rates and amounts available in all states. See SoFi Personal Loan eligibility details at https://www.sofi.com/eligibility-criteria/#eligibility-personal. Not all applicants qualify for the lowest rate. Lowest rates reserved for the most creditworthy borrowers. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, income, and other factors.
Formerly LendingClub, Happen Bank offers competitive rates on a wide range of loan amounts, with funds available in as little as 24 hours after final approval.
- Accepts borrowers with fair credit.
- High loan limit of $75,000.
- Funds may be available in as little as 24 hours.
- Repayment terms range from two to seven years.
- Co-borrowers are permitted.
- Doesn't accept co-signers.
- Origination fee of 2% to 6% of the loan amount.
- No autopay discount.
3. Specialty lenders
If you want to try to get approved on your own, some lenders look at factors beyond credit history. Upstart will consider applicants with any score (or without enough credit history to generate a score), looking at your education, income, employment history and other criteria. It claims its model results in 33% lower rates than traditional lenders.
We like that Upstart considers factors besides credit score, including education, income and employment history. Co-signers aren't accepted.
- Accept applicants with bad or no credit
- Minimum APR is lower than many competitors'
- Approves personal loans up to $75,000
- Most loans are funded the next business day
- Origination fee of 0% to 10%
- Doesn't allow co-signers or co-borrowers
Avant doesn't accept collateral or co-borrowers, but it does consider applicants with credit scores as low as 550. If you sign your loan by 5:30 p.m. ET, you could get funded as soon as the next business day.
This online lender approves borrowers with lower credit and income requirements than many competitors. We also like that it can deliver speedy approval and next-day funding, although it won't pay your creditors directly if you have a debt consolidation loan. The APR and origination fee for applicants with weak credit can be high, but the tradeoff may be worth it if you've been unable to get approved elsewhere.
- Lends to applicants with poor credit
- Funding often available next day
- Late-payment grace period of 10 days
- Origination fee of up 9.99%
- No autopay discount
- Doesn't offer direct payment to creditors for debt consolidation loans
- No co-signers or collateral
If you don't need a large loan, Oportun approves funding for as little as $300, and it accepts low-income and no-credit borrowers, as well as applicants who have filed for bankruptcy.Oportun also offers secured loans in some states.
Open to borrowers with no credit history, especially if needing only a small loan.
- Open to borrowers with no credit history
- No early payoff fee
- Same-day funding available
- Loan amounts as small as $300
- May charge an administrative fee of up to 10% of the principal
- Not available in all states
4. Improve your credit score
If you don't want to risk collateral or a co-borrower, the best way to get approved for financinag is to improve your credit score. It'll take time: According to Experian, one of the three main credit reporting bureaus, it can take 30 to 60 days for your credit report to reflect changes.
But if you have the time, something as simple as asking your credit card company to increase your limit can improve your score. You can also look over your credit reports for mistakes or signs of fraud. And, of course, work to pay your credit card bill on time and in full.
How is your credit score calculated?
Credit scores are calculated differently depending on the model used.
FICO Score 8
Payment history (35%): How often you've made payments on time is the largest factor in calculating your credit score.
Credit utilization (30%): The amount of credit you're using versus your total credit limit across all accounts is the second largest factor in determining your score.
Length of credit history (15%): The average age of your accounts. (Older accounts signal you have more experience handling credit.)
New credit (10%): Many recent credit applications and new accounts can signal financial difficulty.
Credit mix (10%): Lenders look for borrowers with experience with different types of credit, including credit cards and personal loans.
VantageScore 3.0
Payment history (40%): Your record of making loan payments on time. Multiple late payments can hurt your score.
Depth of credit (21%): The age and variety of your accounts.
Credit utilization (20%): The percentage of your total credit limit you're using.
Balances (11%): Your total balance across all accounts.
Recent credit (5%): Newer inquiries and credit accounts can lower your score.
Available credit (3%): Your total credit limit across all accounts.
FICO and VantageScore have separate scoring formulas for different loan products — FICO Score 8 is the industry standard, used for most credit cards, auto loans and personal loans.
In addition, the information used to generate your credit score comes from credit histories kept by one of the three credit bureaus — Experian, Equifax and TransUnion. Your exact score may also differ based on which bureau a lender uses.
How to improve your credit score
Bad credit will make it hard to qualify for unsecured credit cards and loans. Fortunately, there are steps you can take to raise your credit score.
1. Make on-time payments in full
Your payment history is the largest factor in your credit score, so paying bills on time has the biggest positive impact on your score. And while it's essential to make at least the minimum payment, aim to pay your bills in full to reduce your credit utilization ratio.
2. Increase your credit limit
Your credit utilization ratio (CUR) is the amount you owe across your accounts compared to your total available credit limit, expressed as a percentage. Most lenders want to see a ratio below 36% or 40%, but borrowers with the best rates can have a CUR as low as 10%. Paying down your bills is the best way to lower your ratio, but you can also ask your credit card company for a limit increase.
3. Avoid applying for too many cards
When you apply for credit, the lender or card issuer runs a hard inquiry that temporarily lowers your credit score by about five points. Many inquiries in a row can add up, and also suggest you are having trouble staying on top of your finances. You can usually prequalify without hurting your score.
4. Check your credit reports for mistakes
Review your reports with all three credit bureaus for any errors that could be negatively impacting your score. (Free copies are available at AnnualCreditReport.com.) Common mistakes include settled accounts listed as unpaid, individual loans listed multiple times, incorrect balances and fraudulent accounts opened as a result of identity theft.
Disputing a credit report error may take time, but it can make a significant difference. You can also subscribe to a credit repair service, which will work to correct any mistakes or fraudulent items on your credit report.
Offers in this section are from affiliate partners and selected based on a combination of engagement, product relevance, compensation, and consistent availability.
Credit Saint offers a 90-day money-back guarantee and has received an A rating from the Better Business Bureau.
The Credit People's Credit Report Repair service is more affordable than many competitors and even the standard package includes unlimited challenges to all three credit bureaus. The premium package includes escalated disputes and monthly credit score reports.
How to check your credit score
You can usually get your score from your credit card issuer, although they rarely offer both FICO and VantageScore numbers from all three bureaus.
CreditWise from Capital One provides free FICO Score 8 from TransUnion, while *Experian Boost® delivers your Experian credit report and the FICO 8 score it generates. A paid subscription to myFICO comes with access to your FICO scores from all three bureaus, including specialized versions used for mortgages and auto loans.
CreditWise® from Capital One
Cost
Free
Credit bureaus monitored
TransUnion® and Experian®
Credit scoring model used
FICO® Score 8
Dark web scan
Yes
Identity insurance
No.
Experian Boost®
Cost
Free
Average credit score increase
13 points, though results vary
Credit report affected
Experian®
Credit scoring model used
Results will vary. See website for details.
How to sign up for Experian Boost:
- Connect the bank account(s) you use to pay your bills
- Choose and verify the positive payment data you want added to your Experian credit file
- Receive an updated FICO® Score
Learn more about eligible payments and how Experian Boost works.
FICO® Basic, Advanced and Premier
Cost
$29.95 to $39.95 per month
Credit bureaus monitored
Experian for Basic plan or Experian, Equifax and TransUnion for Advanced and Premier plans
Credit scoring model used
FICO
Dark web scan
Yes, for Advanced and Premier plans
Identity insurance
Yes, up to $1 million
Terms apply.
FAQs
What is a bad credit score?
A bad credit score typically falls below 580 on the FICO® Score range. It means many mainstream lenders may reject your application or offer you higher interest rates than borrowers with fair or good credit.
How can I improve a bad credit score?
Paying bills on time and in full is the most important step, but you can also raise your score by reducing your credit utilization and avoiding applying for too many accounts at once. Check your credit reports for errors and evidence of fraud.
Can I get a mortgage with bad credit?
Some lender that specializes in homebuyers with less-than-perfect credit and FHA home loans are available to eligible borrowers with a FICO Score of just 500. You'll have to make a down payment of at least 10%.
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At CNBC Select, our mission is to deliver high-quality service journalism and comprehensive consumer advice to our readers, enabling them to make informed financial decisions. Every personal loan article is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of loan products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content independently of our commercial team and any outside third parties, and we pride ourselves on maintaining high journalistic standards and ethics.
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*Results may vary. Some may not see improved scores or approval odds. Not all lenders use Experian credit files, and not all lenders use scores impacted by Experian Boost.
