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When your credit score isn’t perfect, finding a personal loan can feel like an uphill battle. But here’s the good news — many U.S. lenders specialize in helping borrowers with bad or limited credit histories. Whether you need funds for debt consolidation, emergency expenses, or a major purchase, there are several reliable options in 2025 that offer reasonable rates, flexible repayment terms, and fast funding.
This guide explores the best personal loans for bad credit in the USA, how they work, and what to consider before applying — so you can make a confident financial decision.
Understanding Personal Loans for Bad Credit
A personal loan for bad credit is a fixed-rate installment loan designed for borrowers with credit scores below 630. Unlike payday loans or high-interest cash advances, these loans come with structured repayment terms — typically from two to seven years — and predictable monthly payments.
Bad credit personal loans can be:
- Unsecured: No collateral required; approval depends on income and credit profile.
- Secured: Collateral such as a vehicle or savings account is used to lower risk and interest rates.
These loans help borrowers access necessary funds while building credit through consistent, on-time payments.
Top Personal Loans for Bad Credit in the USA (2025)
Below are the best-performing and most trusted lenders for borrowers with less-than-perfect credit, based on factors like APR, loan terms, eligibility, and funding speed.
1. Upstart — Best Overall for Bad Credit
Why It Stands Out:
Upstart uses an AI-driven underwriting model that looks beyond credit scores, considering factors like education, job history, and income. This makes it ideal for borrowers with limited or no credit history.
Key Details:
- Loan Amounts: $1,000 – $50,000
- APR: 6.6% – 35.99%
- Loan Term: 3 – 5 years
- Funding Time: As soon as the next business day
- Origination Fee: Up to 12%
- Credit Score Requirement: Minimum 300
Best For: Borrowers new to credit or recent graduates.
Pros: Fast funding, soft credit check for prequalification, flexible eligibility.
Cons: High origination fee for some applicants.
2. Upgrade — Best for Flexible Repayment Terms
Why It Stands Out:
Upgrade provides repayment terms from 2 to 7 years, giving borrowers flexibility to choose manageable monthly payments. It’s a good choice for consolidating multiple debts.
Key Details:
- Loan Amounts: $1,000 – $50,000
- APR: 8.49% – 35.99%
- Loan Term: 2 – 7 years
- Funding Time: Within a few days
- Origination Fee: 1.85% – 9.99%
Best For: Borrowers needing extended repayment periods.
Pros: Option for direct payment to creditors; reports to all major credit bureaus.
Cons: Origination fees reduce actual disbursement amount.
3. Avant — Best for Fast Funding
Why It Stands Out:
Avant is popular among borrowers with fair-to-bad credit because of its quick approval and funding process, often completing within one business day.
Key Details:
- Loan Amounts: $2,000 – $35,000
- APR: 9.95% – 35.99%
- Loan Term: 1 – 5 years
- Funding Time: As soon as next business day
Best For: Those needing immediate cash for emergencies.
Pros: Quick turnaround, clear eligibility criteria, fixed rates.
Cons: Higher APR for lower credit scores.
4. OneMain Financial — Best for Secured or Unsecured Loans
Why It Stands Out:
OneMain Financial offers both secured and unsecured loans, making it highly versatile. Borrowers can use personal property, like a car, as collateral to lower their rates.
Key Details:
- Loan Amounts: $1,500 – $20,000
- APR: 18% – 35.99%
- Loan Term: 2 – 5 years
- Funding Time: Same-day or next-day funding
Best For: Borrowers who can offer collateral for better rates.
Pros: In-person support at local branches, no prepayment penalties.
Cons: High starting APRs; limited maximum loan amount.
5. Best Egg — Best for Secured Loans
Why It Stands Out:
Best Egg provides secured loan options using assets like household fixtures or vehicles. This allows borrowers with poor credit to access lower interest rates.
Key Details:
- Loan Amounts: $2,000 – $50,000
- APR: 8.99% – 35.99%
- Loan Term: 2 – 5 years
- Origination Fee: 0.99% – 8.99%
Best For: Borrowers comfortable offering collateral.
Pros: Competitive rates, transparent fee structure, credit-building opportunity.
Cons: Secured loans require asset verification.
6. Prosper — Best for Joint Applications
Why It Stands Out:
Prosper allows joint loan applications, meaning two applicants can combine credit profiles to improve their approval odds and interest rates.
Key Details:
- Loan Amounts: $2,000 – $50,000
- APR: 8.99% – 35.99%
- Loan Term: 2 – 5 years
- Funding Time: Typically 2 – 5 business days
Best For: Couples or family members applying together.
Pros: Joint loans increase approval chances; fixed monthly payments.
Cons: Origination fees and limited grace period.
Comparison Table: Best Personal Loans for Bad Credit (2025)
| Lender | Loan Amounts | APR Range | Term | Funding Speed | Best For |
|---|---|---|---|---|---|
| Upstart | $1,000 – $50,000 | 6.6% – 35.99% | 3 – 5 yrs | Next day | Overall flexibility |
| Upgrade | $1,000 – $50,000 | 8.49% – 35.99% | 2 – 7 yrs | Few days | Long-term repayment |
| Avant | $2,000 – $35,000 | 9.95% – 35.99% | 1 – 5 yrs | Next day | Fast funding |
| OneMain Financial | $1,500 – $20,000 | 18% – 35.99% | 2 – 5 yrs | Same day | Secured loans |
| Best Egg | $2,000 – $50,000 | 8.99% – 35.99% | 2 – 5 yrs | Few days | Collateral-backed loans |
| Prosper | $2,000 – $50,000 | 8.99% – 35.99% | 2 – 5 yrs | 2–5 days | Joint applicants |
Key Factors to Consider Before Applying
1. APR (Annual Percentage Rate)
The APR determines how much interest you’ll pay annually. For bad credit loans, expect rates between 6% and 36%, depending on your score and loan type.
2. Fees
Watch out for origination fees (0–12%), late payment charges, and prepayment penalties. Compare total costs, not just the interest rate.
3. Loan Term
Shorter terms mean less total interest but higher monthly payments. Longer terms reduce payments but cost more over time.
4. Credit Score Requirements
Some lenders accept applicants with credit scores as low as 300, while others require at least 580–600.
5. Funding Speed
If you need cash quickly, choose lenders like Avant or Upstart, which can disburse funds within one business day.
How to Improve Loan Approval Chances
Even with bad credit, you can increase approval odds and secure better rates with a few simple strategies:
- Check your credit report for errors before applying.
- Apply for prequalification to compare rates without affecting your score.
- Add a co-borrower or cosigner with good credit.
- Consider a secured loan to lower interest rates.
- Pay down existing debts to improve your debt-to-income ratio.
When a Personal Loan Makes Sense
A bad credit loan can be a smart choice when used strategically. Here’s when it’s worth considering:
✅ Debt Consolidation: Combine multiple high-interest debts into a single, lower-rate loan.
✅ Emergency Expenses: Cover urgent needs like medical bills or car repairs.
✅ Credit Rebuilding: On-time payments can boost your credit score over time.
✅ Home or Family Needs: Manage big-ticket expenses without credit card debt.
However, avoid personal loans for non-essential spending or if repayment would strain your finances.
Personal Loans vs. Credit Cards
| Aspect | Personal Loans | Credit Cards |
|---|---|---|
| Interest Rate | Fixed (6%–36%) | Variable (up to 30%+) |
| Repayment Term | Fixed term (2–7 years) | Revolving balance |
| Credit Impact | Builds credit through fixed payments | Builds credit through utilization ratio |
| Best For | Large, planned expenses | Everyday or short-term spending |
Final Thoughts
Getting a personal loan for bad credit in the USA is no longer as difficult as it once was. With lenders like Upstart, Upgrade, Avant, OneMain Financial, Best Egg, and Prosper, borrowers can access funds quickly while taking meaningful steps toward financial recovery.
When choosing a lender, compare APRs, fees, and terms carefully — and always ensure that repayment fits comfortably within your monthly budget. With responsible borrowing, these loans can help you rebuild your credit and regain financial stability in 2025.
