Best Installment Loans for Bad Credit in 2024
Confronted with unexpected financial urgencies? Installment loans for bad credit can help you to get money now. Applying does not affect your FICO credit score.
Written By:
Edited By: Janice Myers
Posting Date:
Online installment loans are accessible online within a single business day. They act as an expedient alternative to traditional personal loans for borrowers with a limited income or bad credit.
Investigate the best installment loan offers for bad credit borrowers in 2024 to identify and choose the interest rate that best aligns with your financial situation.
Top Picks for Bad Credit Installment Loan Lenders in 2024
★★★★★
Est.APR
6.40% – 35.99%
Loan amount
$1,000 – $50,000
Min Score
300
More About
PROS
- Quick access to loan funds;
- No prepayment penalties;
- Flexible monthly payments;
- Beyond credit score verification (soft credit check);
- Flexible loan amounts.
CONS
- Origination fees up to 10%;
- High annual percentage rate;
- Co-signers aren’t allowed;
- Limited repayment loan terms.
OVERVIEW
Upstart is a financial platform that enables borrowers with weak credit to get personal loans with flexible payback options. Its key advantage is same-day funding, and there is simply a light credit check conducted throughout the application procedure.
WHO IT’S FOR
Poor credit borrowers who can’t qualify for traditional personal loans.
WHY WE LIKE IT
Upstart does not do credit checks on its customers. Instead, it examines applicants’ whole financial condition. In addition, customers can apply in the morning and receive their personal loan before the end of the day.
LENDER PERKS
- Quick funding (same-day deposit available)
- No origination fees
- Soft credit checks performed
FEES
- Origination fees up to 10%;
- $15 late fee
- $15 NSF fee
REQUIREMENTS
- Be at least 18 years old;
- Prove your US citizenship or permanent residence;
- Provide your bank account information
- Show your monthly income (at least $2,000 monthly income) by providing pay stubs, tax forms, or bank statements;
- Have fair credit (at least 300);
- Provide an active email address and phone number.
TIME OF RECIEVE FUNDS
One business day (same-day funding available)
★★★★★
Est.APR
8.99% – 35.99%
Loan amount
$5,000 – $50,000
Min Score
620
More About
PROS
- Discounts on interest rates
- Debt consolidation loans with direct monthly payments to creditors
- Soft credit check on prequalification stage
- Opportunity to get joint loans
CONS
- Origination fee from 1.99% to 6.99%
- High minimum loan amount
- No mobile app for Android or iOS
OVERVIEW
Achieve can approve loans on the same day, but it takes one to three days to get money. They charge a fee to start a loan. Some lenders don’t charge fees. Achieve’s smallest loan is $5,000. So they may not work if you need a small personal loan.
WHO IT’S FOR
Fair or good credit borrowers who want to cover their credit card debt.
WHY WE LIKE IT
Achieve’s personal loans offer competitive rates and adjustable terms. These loans could work well for people seeking small loan amounts who don’t mind an origination fee.
LENDER PERKS
- Joint loan option
- Discounts on interest rates
FEES
- Origination fees from 1.99% to 6.99%
REQUIREMENTS
- You need a credit score of at least 620
- Your debt-to-income ratio must be less than 45% (excluding mortgage)
- There’s no minimum income requirement
- Your credit history should be of 3 years with at least two accounts
- You shouldn’t have any debt in default
- Bankruptcy is not allowed in the previous 24 months
TIME OF RECEIVING FUNDS
24 – 72 hours from approval
★★★★☆
Est.APR
8.49% – 35.99%
Loan amount
$1,000 – $50,000
Min Score
Doesn’t specified
More About
PROS
- No prepayment penalties;
- Multiple rate discounts;
- Next-day funding;
- The due date may be changed;
- Direct payments for debt consolidation.
CONS
- APRs may be high;
- Origination fees are charged;
- Late fees may be applied.
OVERVIEW
Upgrade is an online financial service that offers up to $50,000 loans to borrowers with good to fair credit. It provides several interest rate reductions and allows you to add a co-applicant or collateral to your application. Choose it if you need money quickly and are not concerned about relatively high interest rates.
WHOM IT SUITS
Fair-credit borrowers who need the money quickly.
WHY WE CHOOSE IT
Upgrade offers convenient maximum and minimum loan amounts along with flexible repayment terms. It also accepts fair credit borrowers and provides several interest rate discounts.
PERKS OFFERED
- Rate discounts for auto pay, direct payment, and reward checking;
- Allows to add a co-applicant;
- Mobile app for managing your loan.
FEES
- Origination fees: 1.85% to 9.99%;
- Late payment fees: $10;
- Non-sufficient funds fees: $10 per payment returned.
ELIGIBILITY REQUIREMENTS
- Be a U.S. citizen, a permanent resident, or living in the U.S. on a valid visa;
- Be at least 18 years old (19 in Alabama and some other states);
- Give a working email address;
- Provide valid bank account details;
- Confirm a sufficient monthly income to cover your loan payments.
FUNDING TIMES
As soon as one business day after clearing verification.
★★★★☆
Est.APR
18% – 35.99%
Loan amount
$1,500 – $20,000
Min Score
None
More About
PROS
- Joint and secured loans are available;
- Wide range of loan options for low credit;
- Pre-qualifying doesn’t affect your credit score;
- Convenient options for debt consolidation.
CONS
- Relatively high interest rates;
- Charges origination fees;
- APRs are not disclosed when pre-qualify.
OVERVIEW
OneMain Financial is a reliable financial service that offers personal loans between $1,500 and $20,000 without minimum credit score requirements. With its joint applications, flexible repayment terms, and soft credit checks for pre-qualifying, it can suit borrowers with bad credit. Interest rates are usually high, though.
WHOM IT SUITS
Borrowers with credit issues who want to avoid predatory lenders.
WHY WE CHOOSE IT
The company offers a wide range of secured, unsecured, and joint loan options with flexible repayment terms. Its personal loans are available to underbanked borrowers.
PERKS OFFERED
- Direct payment to creditors for debt consolidation;
- Loan cancellation within 7 days;
- Fast funding
FEES
- Origination fees: 1% to 10%, or $25 to $500, depending on the state;
- Late payment fees: $5 to $30, or 1.5% to 15% of your loan amount;
- Non-sufficient funds fees: $10 to $50 per payment returned.
ELIGIBILITY REQUIREMENTS
- At least 18 years also;
- Permanent US resident;
- Income confirmation;
- Valid bank account or debit card.
FUNDING TIMES
Within one business day of approval via a direct deposit. Funding within several hours may be offered if you receive the funds on your debit card.
★★★★☆
Est.APR
9.116% – 29.99%
Loan amount
$2,000 – $45,000
Min Score
640
More About
PROS
- Low annual percentage rate;
- Wide range of available loan amounts;
- Same-day funding in some circumstances;
- Accessible for fair credit borrowers.
CONS
- High origination fee (up to 9%);
- No cosigners are allowed for joint loans;
- It is not available in all states.
- Limited term lengths range from 36 to 60 months.
OVERVIEW
Rocket Loans is a financial platform that allows bad credit borrowers to get personal loans with flexible repayment terms. The same-day funding is its main advantage and there is only a soft credit check performed during the application process.
WHO IT’S FOR
Poor credit borrowers who need to make a significant debt consolidation.
WHY WE LIKE IT
Rocket Loans has low APRs and no additional fees. Also, consumers may apply earlier in the morning to receive the personal loan by the end of the same day.
LENDER PERKS
- Easy loan application process
- Fast funding
- Low interest rates
FEES
- Origination fees of up to 9%
- $15 late fee
- $15 NSF fee
REQUIREMENTS
- Be at least 18 years old;
- Prove your US citizenship or permanent residence;
- Provide your bank account information
- Show your monthly income (at least $2,000 monthly income) by providing pay stubs, tax forms, or bank statements;
- Have fair credit (at least 640);
- Provide an active email address and phone number.
TIME OF RECIEVE FUNDS
One business day (same-day funding available)
★★★★☆
Est.APR
9.95% – 35.99%
Loan amount
$2,000 – $35,000
Min Score
580
More About
PROS
- Accepts borrowers with fair credit
- Next-day funding
- No prepayment fees
- Soft credit checks when pre-qualify
- Low minimum income requirement
- Convenient loan amounts and repayment terms
CONS
- Extra fees may be charged
- Relatively high maximum APRs
- No joint or secured loans
- Not available in all states
OVERVIEW
Avant is a trusted online service for borrowers with good to fair credit. The company offers unsecured personal loans with fast funding times, reasonable interest rates, lenient credit score and income requirements, and flexible repayment terms. However, it may charge extra fees and doesn’t offer joint and secured loans.
WHOM IT SUITS
Borrowers with fair and good credit looking for fast loans.
WHY WE CHOOSE IT
Avant provides a faster alternative to traditional bank loans and is available for borrowers with fair credit. It also offers reasonable interest rates and certain loan flexibility.
PERKS OFFERED
- Fast approval and funding
- The ability to change the due date
- Financial education tools
- Credit-building opportunities
FEES
- Origination fees: None
- Administration fees: 4.75%
- Late payment fees: May vary by state
- Prepayment penalties: None
- Dishonored payment fees: May vary by state
ELIGIBILITY REQUIREMENTS
- Be at least 18 years old
- Be a U.S. permanent resident
- Live in a qualifying area
- Have a valid bank or savings account
- Have a credit score of at least 580
- Provide income confirmation (no less than $1,200 per month)
FUNDING TIMES
Next-day funding if you get approved before 4:30 pm Central Time Monday through Friday.
★★★★☆
Est.APR
8.99-25.81%
Loan amount
$5,000-100,000
Min Score
None
More About
PROS
- Low interest rates
- Co-borrowers are allowed
- No prepayment penalties
- Flexible loan amounts
- Wide repayment terms
- No origination fee
CONS
- Good credit is required
- Late fees might apply
- No co-signer option available
- No physical branches
OVERVIEW
SoFi is a financial website that provides unsecured personal loans with a credit score minimum of 680. Personal loans from SoFi are also accessible with a co-borrower with good to outstanding credit. Personal loan candidates must, however, have an adequate income and a modest debt-to-income ratio.
WHO IT’S FOR
Applicants with good to excellent credit scores who want to consolidate debt, make major purchases, and cover significant medical bills.
WHY WE LIKE IT
SoFi does not do credit checks on its customers. Instead, it examines applicants’ whole financial condition. If you take out a credit builder loan, this service reports your on-time payments to the major credit reporting bureaus.
LENDER PERKS
- No prepayment penalties
- No origination fees
- Low interest rates
- Co-borrower option available
FEES
- Optional fees (up to 6%)
REQUIREMENTS
- Be at least 18 years old
- Prove your US citizenship or permanent residence
- Provide your bank account information and social security number
- Show your monthly income by providing pay stubs, tax forms, or bank statements
- Provide an active email address and phone number
TIME OF RECIEVING FUNDS
One business day
BadCredify evaluates lenders based on more than 70 rating criteria, including interest rates, repayment terms, eligibility requirements, fees, consumer experience, affordability, and more. Find out more about our full methodology.
What Are Installment Loans for Bad Credit?
Bad credit installment loans are a viable solution for urgent financial needs, offering a quick way to access funds without harming your FICO credit score. These loans differ from credit cards. Installment loans have fixed interest rates and are repaid in regular monthly payments.
You can get installment loans from banks, credit unions, and private lenders. Traditional financial institutions cater to those with higher credit scores. Installment loans for bad credit are most often available from private lenders due to their poor credit borrowers’ orientation.
How Do Bad Credit Installment Loans Work?
Installment loans consist of the principal and interest rates. You receive the principal as a lump sum in your account, with interest rates determined by your credit score and the lender’s terms. The loan amount is then segmented into fixed payments based on the loan agreement.
The most significant advantage of installment loans is the budgeting predictability. Fixed monthly payments give you a clear idea of the repayment amount each month. Repayment periods for installment loans can be as brief as a few months or extend over several years, subject to the lender’s policies.
Where Can I Get an Installment Loan with Bad Credit?
You can obtain installment loans for bad credit from various sources:
Online Installment Loan Lenders. Online lenders are best for quick application processes and swift funding distribution. Under normal circumstances, a good lender transfers money to your bank account within a business day. Also, online platforms allow you to calculate the loan cost before you sign the agreement.
Traditional Banks. Traditional banks typically cater to larger loan amounts for significant expenses. They are mainly focusing on customers with strong credit histories.
Credit Unions and Community Banks. Credit unions require membership and offer more competitive rates. However, credit unions have limited accessibility and available products compared to other options.
What Can I Use Installment Loan Funds for?
Lenders typically do not restrict how you use your loan, acknowledging that emergencies come in various shapes and sizes. You’re free to spend the funds as needed. People usually spend installment loans for:
- Medical expenses;
- Debt consolidation;
- Utility bill payments;
- Vehicle loan payments or repair expenses;
- Rent and other housing-related expenses;
- Paying off student loans or handling educational expenditures;
- Addressing family financial needs;
- Funeral expenses;
- Childcare costs.
Pros and Cons of Online Bad Credit Installment Loans
Online bad credit installment loans have both features and drawbacks.
Pros:
- Funding Time: If approved, you’ll likely get a loan within a few hours or a business day.
- Freedom of Usage: You can use the funds for any purpose.
- Excellent Rates with Good Credit: A good credit score might mean better loan rates.
- Equal Monthly Payments: You will pay the same amount every month
- Personal Plans: Fair interest rates and flexible repayment terms.
Cons:
- Higher Interest for Bad Credit: Installment loans for bad credit cost more with poor credit score.
- Threshold: Borrowers must meet specific income and credit score requirements.
- Stricter Requirements: Borrowers with poor credit may need collateral or a co-signer to get an installment loan.
- Income-Dependent: You have to prove you earn money regularly.
- Origination Fees: Some lenders might charge up to 10% origination fees.
How to Apply for an Installment Loan with No Hard Credit Check?
The loan application process is usually the same for all types of loans.
- Understand Your Credit. Begin by checking your credit score. Grab your free yearly credit reports to see where you stand.
- Explore Your Options. Shop around and explore various lenders – consider banks, credit unions, and online platforms. Compare interest rates, fees, and payment terms to find the best fit.
- Apply. Choose a lender with terms that suit your needs and submit your application. Some might allow online applications, while others may require a personal visit.
- Wait for Approval. Once applied, the approval time can range from a few hours to a few days, depending on the lender.
- Review and Sign. If approved, thoroughly read your loan agreement. Ensure all terms are clear and sign when ready.
- Get Your Funds. The funds might land in your bank account or come as a check.
Get an Installment Loan for Your Needs
- Applying does not affect your credit score
- Safe and secure application
- Convenient monthly payments
- Any credit score is accepted
Other Types of Installment Loans for Bad Credit
Many alternatives are available online and in-store if installment loans for bad credit don’t suit your needs. Examine each type of loan individually, as they have different terms and conditions.
Auto Title Loans for Bad Credit
Auto title loans are a viable alternative for car owners with bad credit. Borrowers can secure up to half of their auto cost. Car title loans come with notable drawbacks: you put your car at risk of losing; repayment schedules are usually short; these loans come with high-interest rates.
Pawn Shop Loans
Use a pawn shop loan to borrow against the value of your items. Your credit score doesn’t matter since you provide valuable assets. Electronics, instruments, and jewelry are the most popular things that people pledge. You usually have up to 30 days to repay. Once repaid, you reclaim your asset. In case of default, the pawnbroker sells it.
Home Equity Loans
You can use your home as collateral to borrow money with bad credit. Home equity loans can be easier to get because you provide substantial security. But is it worth it to put your home at risk?
Student Loans
Student loans assist with college expenses, including tuition and housing. Young students might need a co-signer due to minimal or bad credit. Student loans are available from federal sources or private lenders.
Conventional Installment Loan Alternatives
If you seek a less risky yet harder-to-get option, consider these conventional alternatives for installment loans.
Payday Loans
Payday loans are convenient, yet they are small loans with very short repayment terms. You can get up to $1,000 in a day, even with poor credit. The repayment term often aligns with your next salary. Payday loans are easy to get, but they come with high APR. Expect interest rates over 400%.
Credit Card Cash Advances
Head to the nearest ATM or the card issuer’s branch with your credit card and withdraw cash now. However, credit card cash advances often possess higher interest rates than standard purchases, and interest starts accumulating immediately.
Hardship Programs
Look for local hardship programs in your city. Local food pantries can provide food for free if you cannot afford it. With documents proving your low-income status, these programs can also assist you with rent, utility bills, and healthcare costs.
Cash Advance Apps
These apps provide small advances on your next paycheck. They usually don’t charge interest, but there might be a small interest fee. Cash advance apps are intended for short-term financial emergencies.
Peer-to-Peer Loans
Peer-to-peer loans are funded by individual investors rather than by traditional financial institutions. P2P platforms connect borrowers with investors. They offer more flexible terms and lower interest rates than traditional bad credit loans.
Paycheck Advances
A paycheck advance could be a wise choice for accessing funds during an emergency. You may ask your employer for a part of your future paycheck beforehand. Be sure to assess if the remaining amount of your paycheck will be sufficient to handle your primary needs. It’s a zero-interest option that you won’t have to repay.
Borrow From Your Relatives
There’s nothing wrong with asking for financial help from your relatives. They likely won’t take fees from you. It’s an obvious one, but it can potentially save you from falling into a debt trap.
Factors to Consider When Choosing a Personal Installment Loan
Personal installment loans come with varying terms and features. Always take a moment to compare lenders, even in urgent scenarios. Prioritize these factors when choosing:
- Total Loan Cost. The cost of your loan is directly derived from its annual percentage rate (APR). APR is a sum of the interest rate combined with additional lender fees. Some lenders include origination fees and prepayment penalties, while others do not. Pre-qualify with various lenders and compare the APRs they present to find the best installment loans.
- Geographical Availability. Confirm that the lender operates in your state. State regulations can affect loan availability, terms, and conditions.
- Lender’s Reputation and Reliability. Research the lender’s track record and reputation. Review testimonials and check for regulatory actions or complaints against the lender.
- Repayment Terms and Conditions. The repayment schedule determines your monthly payments and the overall affordability of the loan. While a low-interest rate is tempting, short repayment periods can hike up your monthly payments.
- Eligibility Criteria. Installment loans offer quick financial help, but you can qualify only with certain conditions met. While examining your application, lenders will check your credit score and evaluate your debt-to-income ratio.
- Cash Transfering Time. When you resort to emergency loans, time is of the essence. Make sure to select a lender capable of processing your loan swiftly.
How Can I Improve My Approval Chances for an Installment Loan with Bad Credit?
You still can get an installment loan with bad credit under certain circumstances. However, you should be ready for high interest rates.
If you want to avoid overpaying, you should take a strategic approach. You may increase your chances of getting better loan terms in a few different ways:
Explain Your Situation. Explain this in your loan application if your bad credit is due to a specific event like a medical emergency or unemployment. Some lenders may consider these factors and provide emergency loans.
Include a Co-signer with Good Credit. Choosing a co-signer who has a high credit score and a dependable income can notably enhance your likelihood of loan approval. They will be liable for repayment if you default.
Offer an Asset as Collateral. Using a valuable asset as collateral can help you secure a loan. Remember, failing to repay the loan puts your assets at risk of losing.
Consider Peer-to-Peer Lenders. These platforms can sometimes offer more favorable terms for bad credit borrowers compared to traditional financial institutions.
Seek Smaller Loan Amounts. Applying for a smaller loan amount can increase your chances of approval. Lenders are often more willing to take a risk on smaller loans.
Methodology
BadCredify takes a responsible approach to selecting and testing the products we recommend. While we compare lenders, we look at verified testimonials only. Our selection criteria include eligibility requirements, interest and fees, repayment plans, and funding speed.
Our editorial team undergoes a detailed pre-qualification process to ascertain the safety and ease of use of these financial products. Furthermore, we liaise with representatives from these lending institutions and double-check their website information for clarity and accuracy regarding loan agreements.
After diligent research and verification of data, we at BadCredify pinpoint the 5 best offers in each loan category based on our reviewed criteria. Our policy is to update this information annually, but we are also equipped to make additional updates throughout the year whenever it becomes necessary.
FAQ
An installment loan provides the total loan amount in one lump sum, and a borrower must pay it back in fixed installments over an extended period.
The funding time largely depends on the chosen option. Traditional financial institutions require 7-10 days to transfer money to your checking account. Some online personal loan lenders can provide same-day loans if you apply in the morning.
Installment loans have a fixed interest rate. Certain types of mortgages can have exceptions. Otherwise, an installment loan has the same interest rate throughout the loan term.
It depends on the lender. Installment loans typically leave a mark on your credit history, mainly because lenders perform hard credit inquiries.
But it’s not all negative—making payments on time can actually improve your credit score. Some lenders who skip hard checks often compensate with considerably higher interest rates.
Depends. Whether an installment loan appears on a credit report is contingent upon the loan’s value and the lender’s discretion. Nevertheless, any payment issues, such as late or missed payments, will certainly be reported and will negatively impact the borrower’s credit score.
Yes, you can. Some lenders can approve your installment loan request on a low income. Your income may be low, but it must be stable. They might require you to have a co-signer or collateral as an additional security measure, though.