Complete list of personal loan options for people with bad credit
If you have damaged credit but need a personal loan, there are options you can pursue to get the money you need. I will walk you through the options from best to worst. If you work down the list in that order, you are more likely to get the best offer you can qualify for. At the end of the video, I will give you some other ideas for how to solve your financial problem if none of these work for you.
Option 1: The first thing you want to do is apply through a marketplace.
This will allow you to get a pretty good view of what you might be able to qualify for. There are several different marketplaces across the internet, but I’m going to tell you about ours, at The Yukon Project. You can filter the lenders by the amount you need and your credit score. When you apply to one of the featured lenders, we will check your rate behind the scenes with up to forty other lenders. Our partners use a soft credit check, so applying won’t hurt your credit score. We will show you all of your approved offers. It’s a great way to get a good overall view of where you stand.
Option 2: If you don’t find the money you need through a marketplace, you can apply with specific online lenders that might not use marketplaces.
The range of loan amounts and APRs can be quite broad for online lenders. Companies’ decision algorithms can be wildly different in this space. If your credit score is below 620 and certainly below 600, there is going to be no way of knowing whether you will be approved by specific lenders without applying first. The following companies say they will lend to people with poor or damaged credit: 60MonthLoans, Achieve, Avant, Money Key, NetCredit, Opploans, and Rise.
Option 3: If none of these will give you the money you need, you can look to storefront lenders.
You can usually find these lenders in strip malls. Most of these lenders are regulated at the state level, so there are not very many national brands. It is much easier to get approved by these lenders. But, the interest can be high and it’s not uncommon for them to push you to secure the loan with the title to your motor vehicle or attach credit insurance which increases the costs. Examples of storefront lenders include Regional Finance, Mariner Finance, OneMain, and World Finance.
Option 4: A riskier option would be to turn to a title loan.
A title loan uses your car title as collateral. If you don’t repay the loan, the lender can take your car. Most title lenders will not require a credit check and you can get the cash fast, usually the same day. The APR on a title loan can be very high, though. It’s not uncommon for them to exceed 100%…and you can lose your car if you miss payments. The largest title loan provider in the country is TitleMax.
Option 5: Pawning an item isn’t just something that’s done in Las Vegas on cable reality shows.
You can almost certainly find a pawn shop near you. The idea is that you give the pawn shop an item of value, like jewelry, electronics, or tools that stands as collateral for the loan. If you fail to come back to redeem the item, they keep it and sell it. The downsides to pawning an item are obvious: they will only give you a fraction of the item’s value and you can easily lose the item. Most pawn shops are local, but there are a few nationwide providers. The largest include FirstCash which operates CashAmerica and EZCorp which operates nearly a dozen different brands nationwide.
Option 6: A very expensive option is to borrow from a Tribal lender found online.
In many ways, these look like any other online lender, but they are actually owned an operated by sovereign Indian tribes. As sovereign nations, they claim they don’t have to adhere to state or federal regulations. It’s the same legal justification that allows tribes to run casinos in states that have outlawed gambling. For that reason, these loans tend to be expensive. The APRs range from 500% to 800%. Just about anyone can get one of these loans. But if you are borrowing more than just a few hundred dollars for more than just a few weeks, the interest expense can be hard to manage. Some of the largest Tribal lenders include SpotLoan, Big Picture Loans, Bright Lending, Mobiloans, and Uprova. But, there are more than a dozen others.
Option 7: Another very expensive option is a traditional payday lender.
These loans can also be called check cashing loans. These generally operate in small stores in strip malls, like the storefront lenders. They often lend small amounts of money just until your next paycheck. They usually charge $15 for every hundred dollars you borrow for less than two weeks. A common risk of payday loans is that you don’t have the money to repay the loan when it’s due. So, you “roll over” the debt into another two-week period. Studies have shown that many people can get in a cycle of kicking the can down the road. Most payday lenders are very small operations with just a handful of locations at the most. There was a statistic going around a few years back that claimed that there were more payday loan stores in the United State than there were McDonalds locations.
As you evaluate your options, you might be dissatisfied with the kinds of offers that you get…or fail to get. So, now I’m going to give you some ideas that could either improve your chance of being approved for a loan or solve your problem in another way.
Secure a Loan with Collateral –
If you have bad credit, putting up an asset like a savings account or the title to your motor vehicle can help you get approved or qualify for lower interest rates. Lenders that offer a secured version of their loans include Achieve, Best Egg, Mariner Finance, OneMain Financial, Prosper, and Upgrade.
Use a Co-Signer –
If you have a trusted family member or friend with good credit, asking them to co-sign a loan can improve your chances of getting approved or help you get you a lower interest rate. Lenders who accept co-signers include: Achieve, LightStream, Mariner Finance, OneMain Financial, Oportun, Penfed, Prosper, Sofi, and Upgrade.
Negotiate a Payment Plan –
If you’re struggling with bills, many lenders, utilities, and medical providers may be willing to accept a payment plan. If you can negotiate a payment plan on some of your other obligations, you might be able to free up enough money in your monthly budget to cover your financial emergency.
Use a Paycheck Advance App –
Apps like Earnin, Brigit, and Dave let you borrow small amounts of your paycheck early with no interest, although they do ask for a tip so it’s not free. This could help you clear a monthly shortfall.
Borrow from Family or Friends –
Borrowing from a family member or a friend can be emotionally dicey. You might risk souring the relationship or turning it into a transaction. It can be weird feeling the need to address the debt every time you see them. One of the best ways to avoid these relationship pitfalls is to put your debt into writing. Record the amount, but also clearly lay out how you will repay the debt and when. As long as you stay on schedule, you never actually need to talk about the arrangement.
Looking to borrow money when you have damaged credit can be a real challenge. These are all the options available to you. Good luck. If you know of any other options that we didn’t mention, please leave a comment below. We are trying to build a community of people who can share their experiences so we can all be better informed when making decisions about our finances. If you found this information helpful, please like this video and subscribe to our channel. Your support helps us out, and we appreciate it.
