7 Best Personal Loan Providers for Bad Credit in 2025
7 Best Personal Loan Providers for Bad Credit in 2025: Securing a personal loan with bad credit typically a FICO score below 580 can be challenging, as lenders often view lower credit as higher risk, leading to elevated interest rates and stricter terms.
In 2025, however, several reputable lenders specialize in offering personal loans to borrowers with poor credit, providing accessible financing for debt consolidation, emergencies, or major purchases. These lenders prioritize factors beyond credit scores, such as income and employment history, to approve loans.
7 Best Personal Loan Providers for Bad Credit in 2025
1. Upstart
Upstart stands out as a top choice for bad-credit borrowers, with a minimum credit score requirement of 300, one of the lowest available. Its AI-driven underwriting model considers education, employment history, and income alongside credit, enabling approvals for those with limited credit history. Upstart offers loans from $1,000 to $50,000, with APRs ranging from 7.99% to 35.99% and terms of 3 or 5 years. Origination fees (0%-12%) apply, but there are no prepayment penalties. Funding is fast, often within one business day, making it ideal for urgent needs. Upstart’s flexible criteria and quick process make it a favorite, though high APRs are possible for low-score borrowers.
2. Upgrade
Upgrade is frequently cited as the best overall lender for bad credit by Investopedia and LendingTree, thanks to its reasonable rates and flexible terms. It requires a minimum credit score of 580 and offers loans from $1,000 to $50,000 with APRs of 7.99%-35.99%. Repayment terms range from 2 to 7 years, the longest on this list, allowing lower monthly payments. Upgrade provides secured loan options (using a vehicle as collateral) and joint applications, which can improve approval odds. Origination fees (1.85%-9.99%) are deducted from proceeds, but funding is available as soon as the next business day. Upgrade’s low minimum loan amount and rate discounts for autopay make it versatile.
3. Avant
Avant is a strong option for borrowers with credit scores as low as 580, particularly for those needing fast funding. Loans range from $2,000 to $35,000, with APRs of 9.95%-35.99% and terms of 2 to 5 years. Avant’s administration fee (up to 4.75%) is lower than some competitors, and funds can be deposited the next business day. Its refinancing option is unique, allowing borrowers to access additional funds or lower rates if their credit improves. Avant’s streamlined application and rapid funding make it ideal for emergencies, though it’s unavailable in states like Nevada and West Virginia.
4. LendingPoint
LendingPoint specializes in borrowers with credit scores as low as 580, emphasizing income and financial stability over credit alone. It offers loans from $2,000 to $36,500, with APRs of 7.99%-35.99% and terms of 2 to 5 years. Origination fees can reach 10%, depending on the state, but funding is quick, often within 1-3 business days. LendingPoint’s flexible underwriting and online process are user-friendly, though higher fees in some states may increase costs. It’s unavailable in Nevada and West Virginia, limiting its reach.
5. OneMain Financial
OneMain Financial is notable for its low credit score threshold, reportedly as low as 500, and its willingness to work with high-risk borrowers. Loans range from $1,500 to $20,000, with APRs of 18%-35.99% and terms of 2 to 5 years. OneMain offers both secured and unsecured loans, requiring documentation like proof of income and residence. Its branch-based model provides a personal touch, but it’s not available in states like Alaska, Arkansas, or Massachusetts. Funding can occur the same day if approved by noon, making it a strong choice for urgent needs, though high APRs and fees are drawbacks.
6. LendingClub
LendingClub, a peer-to-peer lender, accepts borrowers with credit scores as low as 580 and offers loans from $1,000 to $40,000. APRs range from 7.90%-35.99%, with origination fees of 0%-8% and terms of 2 to 5 years. Its unique feature is direct creditor payments for debt consolidation, simplifying repayment. LendingClub reports to all three credit bureaus, aiding credit improvement, and funds loans within 24 hours in many cases. Its average J.D. Power rating for customer satisfaction is a downside, but its flexibility and fast funding make it appealing.
7. Universal Credit
Universal Credit, a sister brand to Upgrade, caters to borrowers with credit scores of 580 or higher, offering loans from $1,000 to $50,000. APRs range from 11.69%-35.99%, with terms of 3 to 5 years and origination fees up to 9.99%. It provides secured loan options and credit monitoring tools, which are rare among bad-credit lenders. Universal Credit allows personal loans for business purposes, unlike most competitors, making it suitable for entrepreneurs. Funding is typically available the next business day, but high APRs and fees can be costly for low-score borrowers.
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Industry Context and Considerations
In 2025, personal loan rates for bad-credit borrowers average 19.83%-32.92%, significantly higher than the 13.38%-19.18% for those with good credit, per Credible and NerdWallet data. Lenders charge higher APRs to offset risk, and origination fees (0%-12%) further increase costs. Bad-credit loans typically range from $1,000 to $50,000 with terms of 2-7 years. Fast funding, often within 24 hours, is a priority for emergency needs, but borrowers must avoid predatory lenders offering “no credit check” loans with APRs exceeding 36%. Responsible repayment can improve credit scores, as most of these lenders report to credit bureaus. Prequalification with soft credit inquiries is recommended to compare rates without impacting scores.
FAQs
What qualifies as bad credit for personal loans?
Bad credit is typically a FICO score below 580. Lenders like Upstart and OneMain Financial may accept scores as low as 300 or 500, but higher scores improve approval odds and rates.
How can I improve my chances of getting a bad-credit loan?
Provide proof of steady income, reduce debt-to-income ratio (ideally below 36%), or apply with a co-signer with good credit. Secured loans, using collateral like a car, also increase approval chances.
What are the average APRs for bad-credit loans in 2025?
APRs range from 7.99% to 35.99%, with bad-credit borrowers often facing rates above 30%, per Credible. Compare lenders to find the lowest rate.
Are there risks with bad-credit loans?
High APRs and origination fees increase costs. Predatory lenders may charge excessive fees or offer unaffordable terms. Verify lender legitimacy via state licenses and reviews.
How fast can I get funds from these lenders?
Most lenders, like Avant, Upgrade, and LendingClub, offer funding within 1-3 business days, with OneMain potentially providing same-day funds if approved early.
Can bad-credit loans help improve my credit score?
Yes, if the lender reports to all three credit bureaus (Experian, TransUnion, Equifax) and you make on-time payments. Lenders like Upstart and LendingClub do this, aiding credit rebuilding.