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Where to get a personal loan with bad credit

date September 1, 2020 time 5 min read 624 views

Even with bad credit, you can get a personal loan. When looking for the best place to get a personal loan with bad credit you should try to find places that don’t use credit scores as a factor in lending money.

It can be quite discouraging looking for good loans with a bad score. Sometimes it seems like there are few legal ways to get personal loans when you are down on your luck. However, today if you’re wondering where you can get a personal loan with bad credit you may be in luck.

More and more lenders are realizing poor credit scores have little say in whether or not a loan should be approved. We’re going to tell you some of the best places to get approved today.

Where to get a personal loan with bad credit
Bad credit is not a death sentence for your financial future and there are many good places to get a loan even with bad credit today (source:

Things to remember when getting loans with bad credit 

Lenders care about whether you will be able to make your repayments, not your credit score. They understand that a bad credit score reflects your past actions, some of which may have been outside your control—for example, losing a job.

Lenders take an enormous risk by not relying on the borrower’s credit history. And until now, credit scores have been one of the most reliable ways they can assess your trustworthiness.

As a loan applicant, there are usually some compensations that you will need to make to get a loan with a low credit score. These include accepting smaller loan amounts higher interest rates, and often providing collateral.

Now let’s look at some of the easiest and best places to get personal loans with bad credit.

Places to get a personal loan with bad credit

1. P2P loans

If you’re looking for the best place to get a personal loan with bad credit, you should consider applying for one through a peer-to-peer (P2P) lending platform.

This type of lending allows you to get a loan online from an individual or a group of individuals rather than a traditional financial institution. Since P2P lenders remove the middle man, rates are often incredibly fair — even with bad credit. 

While some P2P lenders usually require a fair FICO score for approval some platforms, like Upstart, evaluate you using a risk-rating system that decides your loan eligibility outside of a credit score.

Popular no-collateral options include:

  1. Prosper
  2. Upstart
  3. LendingTree

There are also a whole host of P2P platforms like MyConstant that will give you a loan no matter your credit score if you have the collateral to back it up. We’ll talk more about that later.

2. Payday Loans

Payday loans have traditionally been the easiest way for borrowers with bad credit to get loans. And because of that, they are often predatory with interest rates as high as 30%, and terms no longer than 30 days. 

Many payday lenders follow malicious practices to keep borrowers in a cycle of debt when they cannot repay on time. As a rule, they should only be used as a last resort.

 Fortunately, there are many more options available today that give you a much better deal.

3. Online loans

Online lenders are fast becoming a more popular option than regular sources if you want a personal loan with bad credit. This is because they provide many benefits like:

  • Easy applications.
  • Quick approval processes.
  • Less paperwork.
  • Direct deposits to bank accounts.
  • Low interest rates.
  • Reasonable repayment terms.
The best online loan companies for bad credit offer easier ways to get funded with forgiving credit requirements
The best online loan companies for bad credit offer easier ways to get funded with forgiving credit requirements

Some prominent online lenders include:

  • Onemain Financial. (No minimum score. APRs of 18.00 – 35.99%. 2-5 year loans)
  • Avant. (Minimum credit score of 550. APRs of 9.95%-35.99%. Loan lengths range from 24 to 60 months)
  • Rocket Loans. (Minimum credit score of 580. 36 or 60 month terms. APRs of 7.161-29.99%.)

4. Cosigned loans

For larger personal loans, you may be able to get approved for a loan unavailable to you if you can get a cosigner.

A cosigner acts as a “guarantor”, or someone who assures the lender that the monthly repayments will be made on time. A cosigner can be a company or an individual. Parents will often co-sign their child’s first apartment if they lack a credit history.

Cosigners usually must meet strict criteria including excellent credit ratings and enough income to make repayments in case the borrower defaults.

To find a cosigner you should try to ask:

  1. Friends – A friend in need is a friend indeed. If you have financially responsible friends that trust you, ask them to do you a favor by signing a loan.
  2. Relatives – No one knows you like your family. If you have sympathetic family members with good credit, they can help you get the loans you need.
  3. Mentors – While a bit difficult to find, maybe you have a coach or mentor who has seen your drive in other, non-financial aspects of life and is willing to help you out in a tough financial time.
  4. Friends of relatives – This will need some vetting, but if your relatives can vouch for them maybe you can too.

Besides personal contacts there are websites you can go to for finding cosigners. But be warned, there are many scammers out there.

A cosigner may be an easy answer if you are having trouble getting a personal loan from traditional lenders.
A cosigner may be an easy answer if you are having trouble getting a personal loan from traditional lenders (source:

5. Collateral loans

As we mentioned earlier, there are a whole host of ways for you to get a loan if you’re willing to use some of your own assets to guarantee your repayments. Collateral loans are some of the oldest types of loans in existence and there are a growing number of ways to get them.

Some types of collateral loans include:

  • Pawn shop loans – Everyone knows pawn shop loans; you give a pawnshop a valuable item of yours like a watch for fast money and then you pay them back to get the item back. They are, however, quite risky if you do not have a good relationship with the shop owner. Variants of this type of loan include the automobile loan.
  • Financial asset-backed loans – if you want to get a bit more serious (and safe), there are many established companies that let you take out loans against your financial assets. For example: CDs, stock portfolios, mortgages, and other financial positions. For a long time, these assets were some of the most liquid on the market and that’s why many institutions like banks accept them. But that’s changing…
  • Crypto-backed loans – No longer are normal financial assets the most liquid players in the game. Today a growing number of P2P lending platforms are allowing borrowers to back their loans with their crypto portfolio. Some platforms like MyConstant even let you back your loans with multiple cryptocurrencies at the same time. They’re a great way to unlock the value of your investments without selling.

You are not your credit score

There are many legal ways to get a personal loan with a bad credit score today. Better yet, the more difficult it becomes for you to get a loan from traditional lenders like banks, the more opportunities there are for new platforms to take their place. Get out there and have a look at your options, and don’t forget to give MyConstant a look if you have cryptocurrency and want some of the best rates on the market.

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George Schooling

George Schooling

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