Installment loans give you something even more valuable than money: Time. Borrowers receive a lump sum of cash and repay the debt in regular, scheduled installments.
If you have bad credit, though, the peace of mind that comes with an installment loan may seem out of reach.
CNBC Select has chosen the best installment loans for bad credit, based on rates, loan terms, customer service and other criteria. (You can read our methodology for more on how we made our selections.)
What is an installment loan?
An installment loan is a form of unsecured financing paid off over a set number of months or years, typically at a fixed interest rate. Unlike credit cards, installment loans are closed-end financing given in one lump sum. If you need more funding, you’ll have to take out a new loan.
Installment loans are offered by banks, credit unions, fintech companies and other institutions and can be used for any number of reasons. The most common type is a basic personal loan, although mortgages, car loans and student loans are all installment loans, as well.
Bad credit? You can still get funding for major expenses.
Offers in this section are from affiliate partners and selected based on a combination of engagement, product relevance, compensation, and consistent availability.
Annual Percentage Rate (APR)
Best installment loans for bad credit
Best for poor or no credit: Upstart
Upstart Personal Loans
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Annual Percentage Rate (APR)
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Loan purpose
Debt consolidation, credit card refinancing, wedding, moving or medical
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Loan amounts
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Terms
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Credit needed
Credit score of 300 on at least one credit report (but will accept applicants whose credit history is so insufficient they don’t have a credit score)
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Origination fee
0% to 12% of the target amount
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Early payoff penalty
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Late fee
The greater of 5% of last amount due or $15, whichever is greater
Pros
- Open to borrowers with fair credit (minimum 300 score)
- Will accept applicants who have insufficient credit history and don’t have a credit score
- No early payoff fees
- 99% of personal loan funds are sent the next business day after completing required paperwork before 5 p.m. Monday through Friday
Cons
- High late fees
- Origination fee of 0% to 10% of the target amount (automatically withheld from the loan before it’s delivered to you)
- $10 fee to request paper copies of loan agreement (no fee for eSigned virtual copies)
- Must have a Social Security number
Who’s this for? Upstart accepts applicants with a 300 FICO Score, but it also looks beyond credit scores to consider factors like education and work experience. That makes it a good option if you have weak or nonexistent credit.
Standout benefits: Check your rate online without your credit score taking a hit. Borrowers who accept their loan offer weekdays before 5 pm ET can receive funding the next business day.
Best for quick funding: Avant
Avant Personal Loans
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Annual Percentage Rate (APR)
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Loan purpose
Debt consolidation, major expenses, emergency costs, home improvements
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Loan amounts
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Terms
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Credit needed
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Origination fee
Administration fee up to 9.99%
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Early payoff penalty
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Late fee
Up to $25 per late payment after 10-day grace period
Click here to see if you prequalify for a personal loan offer. Terms apply.
Pros
- Lends to applicants with scores lower credit scores
- No early payoff fees
- Can pre-qualify with a soft credit check (no hard inquiry)
- Quick funding (often by the next day)
- Late payment grace period of 10 days
Cons
- Origination fee
- Potentially high interest (caps at 35.99% APR)
- No autopay APR discount
- No direct payments to creditors (for debt consolidation)
- No co-signers
Who’s this for? Avant‘s online application only takes a few minutes to complete and you can get a decision almost instantly. If you’re approved, the funds are available the next business day.
Standout benefits: Avant offers fixed interest rates, so you won’t be surprised by sudden rate changes.
Best for car loans: MyAutoLoan
MyAutoLoan
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APR
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Loan types
New vehicles, used vehicles, refinancing, private party and lease buyout
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Loan amounts
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Terms
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Minimum credit score
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Early payoff penalty
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Late fee
Pros
- Open to borrowers with bad credit (minimum 575 score)
- No early payoff fees
- Prequalification available
- Provides multiple offers
- Fully online application available
- Co-borrowers and co-signers allowed
Cons
- Not available in all states
- Limited customer service
Who’s this for? If you have poor credit, make MyAutoLoan your first stop for car financing. The online marketplace matches you with up to four eligible lenders based on your credit history, income and other factors, so you won’t waste any time. And it only uses a soft credit inquiry, so your score won’t take a hit.
Standout benefits: MyAutoLoan approves private party auto loans, so you can purchase a vehicle from an individual, instead of just a dealership.
Best for military and veterans: Navy Federal Credit Union
Who’s this for? Navy Federal Credit Union has a wide range of loan options for current and former service members and boasts fast funding and no origination fees. If your credit is weak, it approves joint, co-signed and secured loans.
Standout benefits: Navy Federal Credit Union will make direct payments to creditors with its debt consolidation loans.
Best for student loans: Ascent
Ascent Funding
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APR
2.89% to 15.61% APR* with autopay discount (Undergraduate New Loan). Other rates and loan types are available. Visit Ascent’s website for full details.
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Loan types
Undergraduate and graduate loans, MBA, medical school, dental school, law school, doctorate and Master’s, health professional loans.
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Loan amounts
$2,001 up to $200,000 for undergraduate loans and $400,000 for graduate loans
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Loan terms
5, 7, 10, 12, 15, 20 years
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Borrower protections
Deferment and forbearance options available
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Co-signer required?
For DACA recipients and non-U.S. citizens or permanent residents
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Offer student loan refinancing?
Pros
- Considers borrowers with no credit
- High loan limit
- Co-signer release available after just 12 payments
- Up to 1% interest rate discount for autopay*
- 1% cash back rewards*
Cons
- Maximum fixed APR is on the high side
- Doesn’t offer student loan refinancing
Disclosure: *Ascent’s undergraduate and graduate student loans are funded by Bank of Lake Mills or DR Bank, each Member FDIC. Loan products may not be available in certain jurisdictions. Certain restrictions, limitations, terms and conditions may apply for Ascent’s Terms and Conditions please visit AscentFunding.com/Ts&Cs. Annual Percentage Rates (APRs) displayed above are effective as of 8/6/2025 and reflect an Automatic Payment Discount (ACH). The ACH discount consists of 0.25% on credit-based college student loans submitted prior to 6/1/2025, a 0.5% discount for on credit-based college student loans submitted on or after 6/1/2025 and a 1.00% discount on outcomes-based loans when you enroll in automatic payments. Loans subject to individual approval, restrictions and conditions apply. Loan features and information advertised are intended for college student loans and are subject to change at any time. For more information, see repayment examples or review the Ascent Student Loans Terms and Conditions. The final amount approved depends on the borrower’s credit history, verifiable cost of attendance as certified by an eligible school and is subject to credit approval and verification of application information. Lowest interest rates require full principal and interest (Immediate) payments, the shortest loan term, a cosigner, and are only available for our most creditworthy applicants and cosigners with the highest average credit scores. Actual APR offered may be higher or lower than the examples above, based on the amount of time you spend in school and any grace period you have before repayment begins. Variable rates may increase after consummation.1% Cash Back Graduation Reward subject to terms and conditions. For details on Ascent borrower benefits, visit AscentFunding.com/BorrowerBenefits. Ascent applicants and borrowers that agree to the AscentUP Terms of Service and Privacy Policy, as well as students associated with an Ascent parent loan application, have access to the AscentUP platform.
Who’s this for? Ascent approves student loans for borrowers with no credit history. While a co-signer isn’t required, you can apply with one to improve your chances of getting better loan terms.
Standout benefits: Ascent has grace periods of up to 36 months, compared to the 6 months most competitors offer. Ascent also offers bootcamp loans, which help students interested in developing their coding skills pay for tuition and living expenses at coding bootcamps.
How to choose a lender for an installment loan
When shopping for an installment loan, consider the following:
APR: A higher rate means the loan is more expensive since you’ll have to pay back more money over the life of the loan. There are ways to try to get the lowest APR possible, including applying with a higher credit score and signing up for autopay for a discount.
Fees: It’s normal for loan lenders to charge fees, including origination fees, application fees, late payment fees and even prepayment penalties. In many cases, you’ll be hard-pressed to find a lender that doesn’t charge any of these fees, but the goal is to find a good loan with the least amount.
Loan term: A longer loan repayment term means smaller monthly payments while shorter repayment terms usually result in larger monthly payments (assuming all other loan factors remain the same). While longer repayment terms offer the flexibility of lower monthly payments, you’ll end up paying more in interest over the life of the loan so be sure to keep this in mind.
Funding timeline: Funding timelines depend on the lender and type of installment loan you’re getting. For instance, most personal loan lenders can fund you within 3–5 business days. However, when it comes to other types of installment loans, like a mortgage, the process is far more complicated and will take longer.
How to apply for an installment loan
Applying for an installment loan is a relatively simple process:
- Figure out what type of loan you need and how much money you need to borrow. Remember that an installment loan isn’t free money and will always need to be paid back in full with interest. Always have a plan for how to pay for what you’re borrowing.
- Prequalify and compare offers. Most loan lenders run a soft credit check to help you figure out what rates and terms you qualify for without lowering your credit score. Use this to your advantage by shopping around for rates and terms before committing to one lender.
- Gather the required documents and apply. The documents and information you’ll need to submit can depend on the loan you’re applying for. Be sure to discuss requirements with the lender and get a checklist of what you need so you can stay organized throughout the process. When submitting your application, make sure it’s error-free and accurate so you can avoid delays in the approval and funding process.
Pros and cons of installment loans
Before applying for an installment loan, consider the following pros and cons.
Pros
- Fixed monthly payments
- Interest rates lower than credit cards
- Lump sum deposited directly into your account
- High funding limits
- On-time, in-full payments can raise your credit score
Cons
- Many charge origination fee or prepayment penalty
- Longer repayment term can mean more interest
FAQs
What is an installment loan?
An installment loan is a type of financing that is repaid in fixed increments over a predetermined term. The most common types of installment loans are mortgages, auto loans, student loans and personal loans.
Can I be turned down for an installment loan?
Yes, if your credit score or income is too low, you can be rejected for an installment loan.
Is a payday loan an installment or revolving loan?
Payday loans are neither installment loans nor revolving lines of credit. They’re a form of short-term financing usually repaid in a single lump sum on the borrower’s next payday. Installment loans are repaid in increments, while a revolving line of credit can be borrowed from repeatedly.
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Why trust CNBC Select?
At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every 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 without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics. See our methodology for more information on how we choose the best bad credit student loans.
Our methodology
To determine which installment loans are the best for borrowers with bad credit, CNBC Select reviewed over 30 lenders that offer financing for borrowers with bad credit or insufficient credit history.
We compared these lenders based on the following factors:
- Approval requirements
- Loan amounts offered
- Loan interest rates
- Loan terms
- Repayment options
- Bonus features like autopay rate discounts
- Customer service
- Digital experience
We also considered CNBC Select audience data when available, such as general demographics and engagement with our content and tools.
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Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.
