Best Bad Credit Personal Loan in 2020

20 Jan 2021

Everyone wants to have good credit, but for some peculiar reasons, many people end up having bad credit. Your credit history is a track record about how responsible you are with your finance. People with bad credit score find it difficult and face extra challenges to get new credit. Individuals with a bad credit score have limited options, greater restrictions, and typically charged higher interest rates than consumers with a good credit score. So, who are the lenders that offer loans for people with poor credit at reasonable rates and terms & conditions?

What is bad credit?

Credit bureaus generate credit score through credit scoring models. FICO is the main credit scoring system. FICO has many scoring models used by lenders while evaluating a loan application. FICO credit score ranges from 300 to 850. Credit score ranges are defined as:

  • Poor: 300 to 579
  • Fair: 580 to 669
  • Good: 670 to 739
  • Very good: 740 to 799
  • Excellent: 800 to 850

Even to qualify for a bad credit loan, you typically need to have fair credit. However, it depends on a lender how big risk it is willing to take.

What are bad credit personal loans?

Bad credit personal loans are offered to individuals with less-than-average credit.  These loans come with greater restrictions, higher interest rates, and typically shorter terms. Rates, fees, and terms may vary from lender to lender. Various credit unions, banks and online lenders offer this type of loans. As lenders have different requirements and offers, it is important to compare rates and terms from multiple lenders before signing a loan agreement.

What rate can you expect?

While rates vary from lender to lender and are based on your credit score and repayment capacity, here are average rates for different credit ranges.

Credit Score

Estimated APR

670 to 720


630 to 669


300 to 629

27.2%; least likely to qualify

Which lender is right for bad credit loan in 2020?

Here is a list of some of our most popular lenders for bad credit loan in 2020 based on eligibility, fees, repayment methods, repayment tenure, credit score, and other additional features.

Best lender with a minimum loan amount


Upstart is a peer-to-peer lender and caters to younger buyers with a less developed credit history; there is no hard credit check process involved.  

Key details of Upstart bad credit personal loan

  • Minimum FICO score: 600
  • Loan amount: $1,000 to $50,000
  • Loan term:  36 to 60 months
  • Origination fee: 0% to 8%
  • Co-applicant option: No

Best bad credit loan with a co-signer


FreedomPlus primarily offers debt consolidation personal loan with fast approval and fund disbursal. You can add a co-signer to improve your eligibility for a personal loan.

Key details of FreedomPlus bad credit personal loan

  • Minimum FICO score: 620
  • Loan amount: $7,500 to $40,000
  • Loan term:  24 to 60 months
  • Origination fee: 0% to 5%
  • Co-applicant option: Yes, you can add co-applicant

Best lender for bad credit loan with restrictions


LendingPoint, an online lender, offers personal loan for people with fair and bad credit score who want to repair their credit. The personal loan amount can be used for any legal purpose. 

Key details of LendingPoint bad credit personal loan

  • Minimum FICO Score: 585
  • Loan amount: $2,00 to $25,000
  • Loan term:  24 to 48 months
  • Origination fee: 0% to 6%
  • Co-applicant option: No

Best lender for bad credit loans with fast access to funds


Avant provides fast access to funds for customers with low credit score who need a loan for debt consolidation. You can use the funds for emergency expenses.

Key details of Avant bad credit personal loan

  • Minimum FICO Score: Varies case by case; mostly borrowers with 580 to 700 credit score are approved
  • Loan amount: $2,00 to $35,000
  • Loan term:  24 to 60 months
  • Origination fee: Up to 4.75%
  • Co-applicant option: No

Disclaimer: APR, fee, loan amount, term, etc. are based on an analysis of information provided by lenders. They are subject to periodic change, and lenders have sole discretion to do so. Lenders provide APR, fee, and terms depending on borrower’s credit score, income and other factors in mind.

Bottom line

Getting a loan with bad credit score involves hassle and challenges, but there are some reputable lenders who are willing to offer loan even if you have bad credit. And if you manage to get a loan with bad credit, you can improve credit score by making repayment on time, and thus you can get a bigger loan in the future.