Content articles
A personal loan can be a great way to build credit, reduce debt and manage unexpected expenses. It can also have a positive impact on your credit score if you make timely payments.
It’s possible to get a personal loan with below-average or bad credit, though lenders will typically view you as a higher risk and may offer less favorable terms.
1. LendingClub
LendingClub offers personal loans to borrowers with credit scores as low as 300. Its AI-driven platform considers factors beyond credit, including education, employment and income.
Borrowers can get pre-qualified online for loans with a maximum amount up to $50,000. The lender reports loan payments to the credit bureaus, so a late payment could impact your score. The company offers a variety of repayment terms, including the option to repay the loan early with no penalty.
Consumers with a FICO or VantageScore below 580 may have difficulty qualifying for a personal loan, and those borrowers typically receive higher rates than borrowers with a better score. However, borrowers can improve their chances of getting approved for a personal loan by providing collateral, reducing their debt-to-income ratio and adding a cosigner.
In addition, consumers should stay away from lenders that promise guaranteed approval, don’t run a credit check or charge upfront fees for loan applications. Scammers sometimes contact borrowers saying they’re from a reputable lending company like LendingClub and ask them to buy a prepaid card to pay a loan application fee.
2. Oportun
Oportun is a community development financial institution (CDFI). This means it has a absa debt consolidation mission to help underserved communities. This might make it easier to qualify for a personal loan with Oportun, even if you have bad credit or no prior credit history.
Oportun offers both secured and unsecured personal loans. A secured loan requires collateral, such as your car. You can also get a personal loan with a cosigner, which may increase your approval chances and your rate.
While Oportun has a good reputation for customer service, it has faced criticism over its aggressive debt collection practices. If you’ve been sued by Oportun or one of its partner banks, SoloSuit can help you respond and settle your debt to avoid going to court.
If you are a member of a credit union, they can offer you a more affordable personal loan than Oportun. For example, Alliant Credit Union offers personal loans up to $100,000 with more flexible term lengths than Oportun. Oportun loans are originated by Oportun Inc in NM and WI, and by Pathward in AL, AK, AR, AZ, CA, DE, FL, GA, HI, ID, KS, KY, LA, MI, MN, MO, MS, MT, NC, ND, NE, NV, OK, OR, TN, TX, UT, and WY.
3. Happy Money
Happy Money is a personal loan lender with a focus on transparency. Its website breaks down the factors that go into its Payoff loan approval, so you know how you stack up as a borrower before applying. Once approved, the lender can deposit funds into your checking account or repay creditors directly on your behalf. In either case, you can use the loan to rebuild your credit score by making on-time payments and lower your debt utilization ratio.
The lender offers multiple products, but its most popular one is the Payoff debt consolidation loan. It requires a minimum credit score of 580 or a co-applicant with a credit score of at least 580 and can help you manage your debt by reducing the amount of interest you pay each month.
The lender has a good reputation among reviewers, and its customer service is responsive. However, some borrowers complain about mix-ups during the application process and difficulty documenting their income. In addition, the lender does not offer its Payoff loan product to residents of Massachusetts, Mississippi, Nebraska and Nevada.
4. Truist
Truist is the result of a 2019 merger between BB&T (Branch Banking and Trust Company) and SunTrust Banks. This combined company offers a variety of products, including checking and savings accounts, credit cards, mortgages and insurance.
The company’s branded checking account, Truist One Checking, does not charge overdraft fees and provides a $100 negative balance buffer. This account does have a $12 monthly maintenance fee, but it can be waived in five ways, including direct deposit and maintaining a minimum daily ledger balance. Truist also offers a money market account and CDs with terms from seven days to 60 months.
Customers can open an account online, via mobile app or in a branch. The company has over 2,100 branches and ATMs in 17 states, as well as a customer service line that is available weekdays from 8 a.m. to 8 p.m. ET and on Saturdays from 8 a.m. to 5 p.m. ET. It also offers an online chat feature and social media assistance. Customers who are unable to get help can visit a branch or use the company’s 24-hour automated assistant.
5. Rocket Loans
Rocket Loans is a personal loan lender that offers borrowers fast funding and transparent terms. The company also provides a number of fee waivers to help reduce overall costs for borrowers.
The company’s loans are backed by the Rocket Family of Companies, which includes businesses like Rocket Mortgage, Rocket Close and Rocket Home. The company has a variety of different products, including debt consolidation loans and student loan refinances.
Applicants receive a list of available loan options based on their credit score, income and debt-to-income ratio. The company has a minimum credit score of 640, and borrowers must be current on all their debt payments to qualify for a new loan.
Rocket Loans offers borrowers the opportunity to borrow up to $45,000. However, its origination fees (up to 9%) and limited choice of repayment term may not be attractive to some borrowers. Additionally, Rocket Loans does not allow borrowers to add cosigners to their applications. If you’re looking for a personal loan with low origination fees, you should consider checking out LightStream, which doesn’t charge any fees at all and can offer you a better deal than Rocket Loans.