The Best Personal Loans For a Credit Score of 580 or Lower

The higher your credit score, the better your chances of approval on financial products with a lower interest rate.

Even if you have a fair or bad credit score, though, you have options. Some lenders approve applicants with credit scores below 580 for personal loans to cover medical bills, household repairs, debt consolidation and other needs.

CNBC Select has rounded up the best personal loan lenders for applicants with a credit score of 580 or below, based on rate, terms, fees, flexible repayment options and more. (You can read more about our methodology below.)

Who’s this for? If you need money in a pinch, Avant‘s easy online application allows it to provide funding as early as the next business day after approval.

Standout benefits: If you are facing a qualifying financial hardship, Avant may temporarily lower your interest rate for anywhere from three months to a year.

Who’s this for? Part of Upgrade, Universal Credit could be a great fit for a cash-strapped entrepreneur unable to qualify for a standard business loan. It’s one of the few lenders to approve a personal loan for business purposes.

Standout benefits: Universal Credit approves loans for as much as $50,000, more than most competitors, and had loan terms of between 36 and 60 months

Who’s this for? While most lenders start at $1,000 or more, Oportun approves loans for as little as $300, making it optimal for borrowers who don’t need much.

Standout benefits: Oportun accepts low-income and no-credit borrowers and has secured loan options in some states. The online application only takes about ten minutes to complete.and you can pre-qualify with a soft credit check

• Review your credit report. Before applying, make sure there are no errors or evidence of fraud on your reports. If you see an outstanding debt that you’ve already paid off, for example, notify the three credit bureaus.

• Consider alternative lenders. Your first thought might be a big brick-and-mortar bank, but fintechs, credit unions and peer-to-peer platforms like Lending Club and Prosper are often more willing to work with a borrower with underwhelming credit.
• Get a co-signer. If a creditworthy person in your life is willing to take responsibility for payments if you defaulted, it will greatly improve your odds of getting approved and earning a lower rate.
• Provide collateral. A secured loan (which uses a car, home or other asset as collateral) is easier to get approval and lower rates for than an unsecured loan.
• Request a smaller loan. If your credit is too weak for a large loan, consider a credit-builder or a small installment loan.

• Avoid predatory lenders. Payday loans, title loans and other predatory financing can land you deeper in debt.
• Boost your application. Show proof of stable income and job history, lower your debt-to-income ratio and explain specifics like medical debt or divorce

• Compare offers. Use comparison sites to see which offers you’re pre-qualified for and review their APRs, fees and repayment terms.

It is possible to pre-qualify for a personal loan without hurting your credit score. Do some research before you apply. Read reviews and learn what to consider before agreeing to take on a loan.

When you’re ready to apply, follow these steps to ensure you don’t ding your score too much.

1. Shop around for the best rate. Avoid hard inquiries by knowing your credit score before you submit a formal application so you know what you might qualify for. Many lenders will allow you to submit a prequalification form. Or consider using a lending platform (such as Upstart or LendingTree) to view multiple offers at once.
2. Decide on the best offer. Choose the loan with the best monthly payment and interest rate for your budget. Be sure to look at how much the loan will cost you over the full length of the term and decide if the cost is worth it.
3. Submit a formal application. Have your social security number on hand, as well as supporting documents such as bank statements and paystubs.
4. Wait for final approval. This could take just a few minutes, an hour or up to 10 days. To facilitate speedier approval, apply during normal business hours and submit the required documents right away.
5. Get your funds. Once your loan is approved, you’ll be asked to input your bank account information so the funds are deposited into your account. You may also be able to request a paper check from your lender, or in the case of a consolidation loan, you may be able to have funds sent right to your creditors.

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 personal loan review 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 personal loans.

To determine which personal loans are the best for consumers with a credit score of 580 or lower, CNBC Select analyzed dozens of U.S. personal loans offered by both online and brick-and-mortar banks, including large credit unions. When possible, we chose loans with no origination or sign-up fees, but we also included options for borrowers with lower credit scores on this list. Some of those options have origination fees.

When narrowing down and ranking the best personal loans, we focused on the following features:

• Fixed-rate APR: Variable rates can go up and down over the lifetime of your loan. With a fixed rate APR, you lock in an interest rate for the duration of the loan’s term, which means your monthly payment won’t vary, making your budget easier to plan.
• Loan amounts/terms: Each lender provides more than one financing option that you can customize based on your monthly budget and how long you need to pay back your loan.
• Fees and penalties: The lenders on our list do not charge borrowers for paying off loans early.
• Application process: We considered whether lenders offered same-day approval decisions and a fast online application process. 
• Customer support: Every loan on our list provides customer service available via telephone, email or secure online messaging. We also opted for lenders with an online resource hub or advice center to help you educate yourself about the personal loan process and your finances.
• Fund disbursement: The loans on our list deliver funds promptly through either electronic wire transfer to your checking account or in the form of a paper check. Some lenders (which we noted) offer the ability to pay your creditors directly.
• Discounts: We noted the lenders that reward you for enrolling in autopay by lowering your APR by 0.25% to 0.5%.

We also considered CNBC Select audience data when available, such as general demographics and engagement with our content and tools.

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