15 Bad Credit Loans and Credit Cards

Bad Credit Loans And Credit Cards

The availability of bad credit loans and credit cards is a critical lifeline for consumers who’ve faced significant financial challenges. While the two forms of credit charge high interest rates, they are much better choices than payday loans, title loans, and other predatory debt.

Anyone can experience credit problems from time to time. The reviewed loans and credit cards can help you through the hard patches. Even better, the credit cards and some personal loans allow you to rebuild your credit by making your payments on time each month.

Until then, the credit cards and loans described below can help stretch your budget or handle unexpected expenses despite a low credit score.

Personal Loans For Bad Credit

These seven online lending networks specialize in arranging personal loans for consumers with subprime credit. These online loan networks charge nothing for their service, and using them to prequalify for a loan won’t hurt your credit.

  • Short-term loans up to $5,000
  • Online marketplace of lenders
  • Funds available in as few as 24 hours
  • Simple online form takes less than 5 minutes
  • Trusted by more than 2 million customers
  • Not available in NY or CT
  • Click here for official site, terms, and details.
★★★★★

4.8

Overall Rating

Loan Amount Interest Rate Loan Term Loan Example
Up to $5,000 Varies Varies

See representative example

MoneyMutual is our choice for the best personal loan network serving consumers with low credit scores. It can immediately prequalify your bad credit loan request to find you a willing lender. To participate, you must satisfy age, residency, and account ownership requirements and collect an income of at least $800 per month.

   
★★★★★

4.7

Overall Rating

Loan Amount Interest Rate Loan Term Loan Example
$500 to $10,000 5.99% – 35.99% 3 to 72 Months

See representative example

CashUSA.com can quickly prequalify you for a small to moderate personal loan even if your credit is poor. You must be a US resident, 18 or older, and earn at least $1,000 a month after taxes. You also need a valid email address, an active checking account in your name, and a working phone number.

BillsHappen® can instantly prequalify your request for an online loan. Its lender network offers small- to medium-sized personal loans to accommodate the individual needs of subprime consumers. BillsHappen® employs AES 256-bit encryption technology to shield your privacy.

CreditLoan.com can quickly prequalify your bad credit loan request despite your low credit score. The company has helped more than 750,000 customers and 33 million website visitors since 1998. Its educational website has earned certifications from TrustedSite for security and data protection.

BadCreditLoans.com serves consumers with poor credit who need a fast personal loan. To prequalify, you must have enough income from work or benefits to afford the monthly payments. If the company can’t find you a loan, it may connect you with offers for debt relief, credit repair, or other credit-related products or services.

PersonalLoans.com is the best personal loan network for large unsecured loans. You must collect at least $500 a month and have an active checking account to prequalify. PersonalLoans.com also offers short-term loans that allow you to get your income tax refund in advance. 

★★★★

4.3

Overall Rating

Loan Amount Interest Rate Loan Term Loan Example
$500 to $35,000 5.99% – 35.99% 60 Days to 72 Months

See representative example

24/7 Lending Group can get you multiple personal loan offers when you need to borrow money. You can collect your funds in as little as 24 hours after final approval. This loan matching service has more than 15 years of experience helping consumers with less-than-excellent credit. 

★★★★

4.1

Overall Rating

Loan Amount Interest Rate Loan Term Loan Example
$100 to $20,000 Varies Varies

See representative example

Loans from SmartAdvances.com come in a range of amounts and interest rates. The loan offer you receive will be based on your credit rating and income. But a bad credit score need not stop you from applying — there’s no harm to your credit score by seeing what loan offers you may qualify for.

Best Credit Cards For Bad Credit

These cards generally aim for customers with credit scores below 600. They are a mix of secured and unsecured cards that report your payments to the major credit bureaus, enabling you to rebuild your credit rating. 

  • Don’t let a low FICO score stop you from applying – we approve applications others may not.
  • You don’t need good credit to apply.
  • Just complete the short application and find out in 60 seconds if you’re approved.
  • When you need assistance our award-winning US-based Customer Service agents are there to help.
  • FICO scores are used to represent the creditworthiness of a person and may be one indicator to the credit type you are eligible for. However, credit score alone does not guarantee or imply approval for any PREMIER Bankcard® product.
★★★★★

4.8

Overall Rating

Application Length Interest Rate Reports Monthly Reputation Score
4 minutes See Provider Website Yes 9.0/10

Merchants accept the PREMIER Bankcard® Mastercard® Credit Card for purchases worldwide. This is one of the best unsecured credit cards for easy approval, even if your credit score is poor. Read the card’s terms and conditions carefully to understand its costs and fees.

  • You don’t need good credit to apply.
  • We help people with bad credit, every day.
  • Just complete the short application and find out in 60 seconds if you’re approved.
  • You can build* or rebuild your credit: apply for a PREMIER Bankcard credit card, keep your balance low, and pay all your monthly bills on time.
  • Don’t let a low FICO score stop you from applying – we approve applications others may not.
  • FICO scores are used to represent the creditworthiness of a person and may be one indicator to the credit type you are eligible for. However, credit score alone does not guarantee or imply approval for any PREMIER Bankcard® product.
  • *Build credit by keeping your balance low and paying all your bills on time every month.
★★★★★

4.8

Overall Rating

Application Length Interest Rate Reports Monthly Reputation Score
4 minutes See Provider Website Yes 9.0/10

Functionally identical to the orange version, the PREMIER Bankcard® Grey Credit Card provides a generous 27-day grace period before charging interest on purchases. The card charges setup and maintenance fees based on your credit limit. The issuer may increase your credit limit after 12 months of on-time payments.

11. Secured Sable ONE Credit Card

This offer is currently not available.

N/A

Overall Rating

Application Length Interest Rate Reports Monthly Reputation Score
N/A N/A N/A N/A

The Secured Sable ONE Credit Card helps you graduate to an unsecured card by achieving milestones for purchase volume, direct deposits, and credit limits. It is the only secured card in this group, offering the best perks and the lowest costs. Noncitizens can apply without a Social Security Number using their passport and US visa for identification. 

  • Up to $1,000 credit limit doubles up to $2,000! (Simply make your first 6 monthly minimum payments on time)
  • All credit types welcome to apply!
  • Free access to your Vantage 3.0 score From Experian* (When you sign up for e-statements)
  • Initial Credit Limit of $300 – $1,000* (subject to available credit)
  • Monthly reporting to the three major credit bureaus
  • See if you’re Pre-Qualified without impacting your credit score
  • Fast and easy application process; results in seconds
  • Free online account access 24/7
  • Checking Account Required
★★★★★

4.7

Overall Rating

Application Length Interest Rate Reports Monthly Reputation Score
9 minutes 24.99% – 29.99% (Variable) Yes 8.5/10

Celtic Bank’s Surge Mastercard® provides zero liability protection to shield you from charges you didn’t make. Its mobile app lets you check payment due dates, pay bills, arrange direct deposits, and view statements. Surge Mastercard charges less interest than most competitors do and doesn’t impose a penalty APR on late payments. 

  • With the Fortiva® Mastercard® Credit Card, you earn up to a 3% cash back reward
  • Make contactless payments through Mobile Wallet
  • Periodic Credit Increase Reviews
  • Free access to your Vantage 3.0 score from Equifax†
  • † Your credit score will be available in your online account 60 days after your account is opened. (Registration required) The free VantageScore 3.0 credit score provided by Equifax is for educational purposes only and may not be used by The Bank of Missouri (the issuer of this card) or other creditors to make credit decisions.

★★★★★

4.7

Overall Rating

Application Length Interest Rate Reports Monthly Reputation Score
7 minutes 29.99% OR 36% (V) Yes 8.0/10

The Fortiva® Mastercard® Credit Card from the Bank of Missouri offers bonus cash back on eligible gas, grocery, and utility purchases. The card provides an instant credit decision, transaction alerts, and $0 fraud liability. Your credit limit determines your annual and maintenance charges. 

  • Credit lines range from $550-$1,350 which double to $1,100-$2,700 after your account qualifies. No security deposit required.
  • Double your credit line by making at least your minimum payment on time each month for the first 7 months your account is open.
  • See if you are pre-approved within minutes, without affecting your credit score.
  • Build or rebuild your credit. As you pay your bill every month, we report to all three major credit reporting agencies.
  • Get your FICO® Credit Score for free each month.
  • Fraud coverage if your card is lost or stolen. Access your account 24 hours a day, 7 days a week. Get help staying on track with available Auto Pay and account alerts.
  • Card issued by Merrick Bank, Member FDIC.
★★★★★

4.7

Overall Rating

Application Length Interest Rate Reports Monthly Reputation Score
10 minutes 21.70% to 30.70% *Variable Yes 7.5/10

The Merrick Bank Double Your Line® Mastercard® provides $0 liability protection and rewards timely payments by doubling your credit limit. Unlike some others, this credit card doesn’t impose a Penalty APR when you miss a payment. You can pay your bill online or by check, direct deposit, or phone.

  • Revvi active cardholders get exclusive access to free Credit Monitoring powered by TransUnion!
  • Earn 1% cash back rewards^^ on payments made to your Revvi Credit Card
  • Fast and easy application; response provided in seconds
  • $300 credit limit (subject to available credit)
  • Build your credit score with on-time payments and keeping your balance below the credit limit
  • Opportunity to request credit limit increase after twelve months, fee applies
  • Checking account required
  • Reports monthly to all three major credit bureaus
  • Manageable monthly payments
  • Perfect credit not required
  • Easy-to-use mobile app for management on the go!
  • *See rates, fees, costs & limitations, and rewards for complete offer and Revvi Rewards details^^
★★★★★

4.7

Overall Rating

Application Length Interest Rate Reports Monthly Reputation Score
8 minutes 34.99%* Yes 8.0/10

The Revvi Card is a Visa credit card you can obtain without having a good FICO Score. It offers cash back rewards in the form of statement credits, and you can redeem your rewards in 500-point increments six months after account opening. There are no first-year fees for maintenance or cash advances.

What Is Bad Credit?

Approximately 16% of Americans have a bad credit score that reflects a history of credit mistakes. In the 300 to 850 FICO score range, a credit score below 580 is considered very poor. 

FICO Score Ranges

Consumers with bad credit have experienced financial problems, including missed payments, collections, repossessions, account write-offs, bankruptcies, and other negative events. When you have bad credit, available credit cards usually offer the most basic features, and loans are expensive.

How Do Personal Loans For Bad Credit Work?

Getting approved for personal loans (or signature loans) relies on your pledge to repay the loan according to the terms of the agreement. The reviewed personal loans do not require you to deposit collateral. 

You repay personal loans in fixed monthly installments, typically over three months to eight years. A longer loan term on an installment loan costs less per month, but the total cost is higher due to interest charges on the unpaid principal. 

As the loan amount you owe declines, less of your monthly payment goes to pay interest, and more goes to repay the principal installment loan amount.

Long-term installment loans charge up to 36% interest, but don’t be surprised if the lender has an origination fee of 3% or more. While certainly not cheap, personal loans are considerably less expensive than a title, pawnshop, or payday loan. 

Installment vs Payday Loans

Personal loans don’t typically charge a prepayment penalty, meaning you can save money by paying off the loan before the final due date. 

Personal loans usually charge simple interest (i.e., not compounded), calculated by multiplying the daily periodic rate by the remaining principal and the number of days between payments. Some lenders prefer to use a monthly periodic rate. 

For example, a $5,000 personal loan with a three-year loan term and an interest rate of 6% will charge $475.95 in interest. You can reduce interest charges by paying your monthly bill early in the billing cycle and paying more than the minimum due. 

You may occasionally come across secured personal loans that require you to post collateral. Borrowers forfeit their property if they fail to repay their secured loans.

Do Banks Give Loans to People With Bad Credit?

You are invisible to most banks if you have poor credit and want an unsecured loan. A bad FICO Score means you have a relatively good chance of defaulting on debt within the next two years. Banks exist to make profits, which they guard by avoiding risky loans. 

You may be able to get secured loans from a bank if you post collateral, such as your home or your car. But other valuables may suffice, such as jewelry or a rare stamp collection. 

Credit unions are better than banks for personal loans. These financial institutions are usually nonprofit and willing to help members. You must first join a credit union, which may require you to satisfy eligibility requirements concerning where you live, work, pray, etc. But a few national credit unions do not impose conditions on membership.

That said, credit unions are not especially good sources for borrowers with poor credit. Depending on your credit score, you may have to explore other alternatives.

What Are the Different Sources For Personal Loans?

If you have bad credit, banks and, to some extent, credit unions may be unwilling to offer you a personal loan. 

But you have options. Despite bad credit, you can borrow small and medium amounts from an online personal loan lender. Some lenders work through networks, while others offer loans directly to consumers.

You can use the proceeds from a personal loan any way you want. One popular choice is a debt consolidation loan you use to pay off existing loans and credit cards. A credit card consolidation loan leaves just one manageable monthly payment. 

Loan Networks

The seven reviewed lender-matching services work with networks of direct lenders to arrange personal loans. They generally all work the same way:

  1. You fill out a loan request form and provide basic information about yourself, your income, and your expenses.
  2. The lender-matching service attempts to prequalify your request. This step does not require a hard credit check and therefore doesn’t hurt your credit.
  3. If you successfully prequalify, the service will dispatch your loan request to the members of the lending network. 
  4. The service will forward you one or more loan offers, assuming at least one lender on the network is willing to work with you.
  5. The lending service will either transfer you to a direct lender’s website or alert you to multiple offers. 
  6. You must submit a loan application to a direct lender, which may require additional information not included in your original loan request.
  7. If the lender approves your application, it will present you with the loan rate, terms, and other required disclosures.
  8. You can read the loan agreement and e-sign if it is acceptable.
  9. The lender will deposit the loan proceeds in your bank account in as little as one business day.

The prequalification step is important because it tells you whether your request is feasible without harming your credit. The typical eligibility requirements for prequalification are:

  • You must be a US citizen or permanent resident.
  • You must be 18 years old (in some states, 19).
  • You must collect a specified monthly income from work or government benefits.
  • You will need to have a bank account and an email address.

The lending networks can usually prequalify your loan request within a minute. Some lending services, such as Lending Tree, display competing loan offers on their websites.

If you receive multiple loan offers, you must compare them closely. Rates, fees, and other terms can vary considerably, so it pays to take your time and fully understand any loan offer. A mistake here can cost you hundreds of dollars or more.

Direct Lenders

Direct lenders use internal funding, sometimes augmented with that of partners, to provide personal loans. The lender-matching services use networks of direct lenders. In addition, banks, credit unions, and other financial institutions directly lend to borrowers.

If you don’t use a lending network, you must identify direct lenders and submit a separate application form to each one. As discussed, banks and credit unions are direct lenders but are less likely to welcome borrowers with bad credit.

Direct lenders usually perform a hard credit check when you apply for a loan which will reduce your credit score by a few points and remain on your credit report for two years. In contrast, soft credit checks that lender-matching services request during the prequalification stage do not harm your credit. 

Benefits of Lending Networks

Some direct personal loan lenders, including OneMain Financial and LendingClub Bank, have a strong online presence. They typically charge more than banks but have less stringent eligibility requirements.

Peer-to-Peer Loans

Peer-to-peer (P2P) loan marketplaces are websites that bring together borrowers and lenders to transact with each other. They often use in-house underwriting systems to measure borrower default risk. 

On the plus side, many P2P lenders have low overhead costs, allowing them to charge less interest. But the application process is often more elaborate and requires additional information not needed by lender-matching networks.

PersonalLoans.com, while mainly an online lender-matching service, also supports P2P lending. Other well-known P2P lending marketplaces include Peerform and LendingClub. 

What Type of Loan Is the Easiest to Get With Bad Credit?

The most accessible loans don’t require applicant credit checks but may charge high interest rates. They include:

  • Payday loans: These are short-term loans you repay on your next payday. A typical payday loan often charges interest rates of 300% to 700% or more.
  • Pawnshop loans: You can get a pawnshop loan secured by personal property, such as jewelry, watches, musical instruments, and guns. Typical loan amounts are less than half the collateral’s value and interest rates are incredibly high. If you fail to repay the loan by a set date, the pawnshop will put your property up for sale.
  • Title loans: You can use your title to a car (or boat or aircraft) as collateral for these expensive loans. The title must be clear, without any outstanding auto loan debt or liens on the car.
  • Loans from friends and family: These are usually informal and may charge little or no interest. But you risk harming a personal relationship if you don’t repay the loan.

You may be able to arrange a no-credit-check personal loan on a lender-matching network. Expect these to charge higher interest rates and fees, and some may require collateral.

How Can I Use Credit Cards For Rebuilding Credit?

Bad credit need not be permanent. You can start rebuilding credit by adopting responsible behavior, including:

  • Paying your bills on time: You won’t be building credit if you’re late paying your bills. Lenders and credit card companies report your payments to the major credit agencies, and paying on time should help elevate your score within six to 12 months. Suppose you habitually have trouble paying your bills. In that case, you should consider taking remedial steps such as reducing your debt-to-income ratio, obtaining debt counseling, getting a debt consolidation loan, settling your debt, or filing for bankruptcy.
  • Reducing credit card debt: Your credit utilization ratio (CUR) is your credit card debt divided by your total available credit. The FICO scoring system penalizes consumers with CURs above 30%. Accordingly, you can improve your credit score by reducing your CUR below this threshold. 
  • Repairing your credit reports: Inaccurate information on your credit reports can depress your credit score. Federal law entitles you to dispute erroneous information, either by yourself or with the help of a credit repair company. If you win your dispute, the credit bureau must remove the error from your credit report and inform recent recipients of the correction. Your score should then recover within a couple of months. 
  • Waiting: Negative items can remain on your credit reports for up to 10 years. But their impact on your credit score begins to fade after the first two to three years. 

It’s never too late to adopt creditworthy habits. Credit counseling from nonprofit agencies can help you build a workable monthly budget and show you how to reduce your debt. 

How Can I Increase My Odds of Loan Approval?

Earlier we discussed how paying bills on time, reducing debt balances, and removing credit report mistakes can help your chances of building credit and give you better access to loans. Here are some more tips to help you get a loan:

  • Recruit a cosigner: Many lenders and some credit card issuers allow you to include a cosigner for your loan application and agreement. The cosigner should have good credit. Cosigners are responsible for making payments when you fail to do so. The credit bureaus record the loan activity in the files of both loan signers. 
  • Provide collateral: Many creditors will look past your less-than-excellent credit score if you post enough collateral to secure a loan. Secured credit cards usually require a deposit equal to your credit limit, the amount you can spend on purchases or withdraw in cash advance transactions.
  • Become an authorized user: Most credit cards allow their owners to add authorized users to the account. An authorized user is issued a copy of the card that they can use for purchases and cash advance loans. Only the primary cardholder is responsible for paying the credit card bills.

Raising your FICO score above 630 creates many more opportunities to borrow money and get better quality credit cards.

What Kind of Credit Card Can Customers With a Bad Credit History Get?

Secured credit cards are available to consumers with no, limited, or bad credit. Some don’t even check an applicant’s credit. You must deposit cash collateral to secure these cards. The deposits are refundable when you close the account or graduate to an unsecured card. 

Secured vs. Unsecured Credit Cards

Student credit cards are also easy to get if you attend college or trade school at least half the time. Student cards are probably the best deals in the industry, often providing rewards on purchases and various credits not commonly available on subprime cards. 

How Can I Get a $500 Credit Limit With Bad Credit?

If you take the secured credit card route, you will need to deposit $500 into the card’s escrow account, plus pay any upfront or annual fees. Some secured cards may enforce an initial credit limit below $500 but allow you to add deposits over time. 

Unsecured cards for bad credit may offer you an initial credit limit of as low as $200. Many promise to review your credit limit if you pay your bills on time for a set period. If you can recruit a cosigner, you may be eligible for better quality credit cards with spending limits easily exceeding $500.

Which Credit Cards Give You Instant Approval?

Most credit cards offer some form of instant preapproval without guaranteeing final approval. But two secured cards, the Secured Sable ONE Credit Card and OpenSky® Secured Visa® Credit Card, do not check credit and can immediately approve your application. You must prepay the security deposit on these cards before the issuer ships them. 

OpenSky® Secured Visa® Credit Card

Many card issuers check credit quickly and can provide approval in minutes. But if you have a problematic credit history, receiving final approval may take days or weeks. During that time, the issuer may ask for various documents to verify your income and current financial obligations.

The subprime unsecured cards offering quick approval are likeliest to have minimal credit limits and high setup fees. That’s why you are probably better off applying for a secured card. You’ll get your deposit back from a secured credit card, but the high fees that unsecured cards charge are gone forever.

Can I Get a Business Credit Card With Bad Credit?

Most business credit cards require at least fair credit. Business owners typically must personally guarantee payment of these cards, but if you have bad credit, card issuers may not assign much value to your guarantee.

Your best bet is to get a secured business credit card, such as the Business Advantage Unlimited Cash Rewards Secured Credit Card from Bank of America. If you want an unsecured business card, the Spark 1% Classic from Capital One is relatively easy to get, but approval requires fair credit or better.

Compare the Best Bad Credit Loans and Credit Cards

Our review of bad credit loans and credit cards should give you plenty of leads to pursue when your finances are tight. The personal loan networks we discussed can provide short- or long-term financing even if you have poor credit. 

Credit cards for bad credit usually charge APRs of 25% or higher. We recommend you consider a secured credit card if you can afford the deposit. They’re much easier to get and cheaper to own. When you pay your bills on time, the issuer may promote you to an unsecured card and refund your deposit. 

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