Struggling with bad credit and in need of a personal loan? You’re not alone. Millions of people face financial emergencies that require immediate action, even when their credit isn’t perfect. Personal loans with fixed monthly payments may be the solution you’re looking for, giving you the funds you need while allowing manageable repayment options.
Top 4 Bad Credit Loans
Ready to find the personal loan that can help get you back on solid financial footing, regardless of what your credit history looks like? Here are our top picks for bad credit loans with monthly payments.
MoneyMutual
Features & Benefits
- Application takes less than 5 minutes
- Get a decision on your loan within minutes
- Funds are available within 24 hours
- Trusted by more than 2,000,000 borrowers
MoneyMutual is an online marketplace of lenders. They make it quick and easy to find a short-term cash advance loan in as little as 24 hours.
One application can potentially get you multiple loan offers. MoneyMutual has been trusted by more than two million customers. They serve borrowers with bad credit from all 50 states except New York and Connecticut.
CashUSA
Features & Benefits
- Flexible borrower requirements
- Loan request can be approved within minutes
- Money deposited as early as 1 business day
- All credit types accepted
CashUSA connects borrowers with lenders. Each application is sent to the lender most likely to lend to the borrower. This platform caters to a diverse range of credit profiles, making it more than just a broker for those with poor credit.
Interest rates vary depending on the lender, so make sure you read through the terms for each emergency loan before you choose. Applying online only takes a few minutes, and funds are often available the next day.
BadCreditLoans.com
Features & Benefits
- No cost to check loan approval
- High approval rate despite credit history
- Funds available as soon as next business day
- Assisting people with bad credit since 1998
Bad Credit Loans is an online lender marketplace that allows you to connect with multiple lenders by filling out a single application. The service is 100% free.
Once you’re approved, your lender will provide you with the APR, loan fees, and other terms.
Read through the terms, compare all the offers you’ve received, and only accept the loan you’re most comfortable with. You are not obligated to accept the personal loan from any lenders that you are matched with.
PersonalLoans.com
Features & Benefits
- Multiple loan types available
- Fast loan decision
- Funds deposited as soon as you accept an offer
- Nationwide availability
PersonalLoans.com offers access to multiple loan types through a network of lenders, catering to individuals with credit scores as low as 600. Each lender provides unique rates, allowing you to choose the best offer for your needs.
The online application process is quick and easy, taking just minutes to complete. You’ll receive a decision within one business day, and approved funds can be deposited shortly after you accept an offer.
Why Personal Loans Are a Good Option for Bad Credit
If you’ve got bad credit, finding the right loan can feel tricky. Personal loans with monthly payments offer a solution that’s often better than payday loans or credit cards. Here’s why they stand out:
Lower Interest Rates
One of the main benefits of personal loans is that they typically come with lower interest rates compared to credit cards. While credit cards can carry rates around 17% or higher, personal loans for bad credit may offer lower rates, depending on the lender. This means you’ll likely pay less in interest over time, making it a more affordable option for covering expenses.
Fixed Monthly Payments
Personal loans are also easier to manage because they come with fixed monthly payments. Unlike credit cards, where your payments can fluctuate, a personal loan gives you a predictable payment schedule. This makes budgeting simpler since you know exactly how much you owe each month and when the loan will be paid off.
Avoid the Temptation of More Debt
Credit cards can lead to a cycle of revolving debt if you’re not careful. It’s easy to keep spending and increasing your balance. With a personal loan, you borrow a set amount and can’t keep adding to it. This helps prevent you from falling further into debt and gives you a clear path to becoming debt-free.
Key Features to Look for in a Bad Credit Loan
When you’re searching for a personal loan with bad credit, it’s important to know what to prioritize. Not all loans are created equal, so focusing on a few key features can help you make the best choice for your situation.
Interest Rates
Interest rates can make or break a loan offer. For borrowers with bad credit, rates tend to be higher, but that doesn’t mean you should settle for the first offer you get. Look for lenders offering the lowest possible rates, as this will save you money in the long run. Even a small difference in interest rates can lead to big savings over the life of the loan.
Loan Terms
Loan terms refer to the length of time you have to repay the loan. Shorter terms mean higher monthly payments but less overall interest, while longer terms spread the payments out but may cost more in the long run. It’s important to find a loan term that balances affordable monthly payments with minimizing interest costs.
Fees and Additional Costs
Always check for hidden fees. Some lenders charge origination fees, late payment fees, or prepayment penalties. These fees can add up and increase the total cost of your loan. Make sure to read the fine print and choose a loan with minimal or no fees, especially if you’re already working with a tight budget.
Lender Flexibility
Some lenders offer more flexible repayment options, especially for borrowers with bad credit. Look for lenders that allow you to customize your loan terms, like the payment schedule or due date, or offer the option to skip a payment during tough times. Flexibility can make managing your loan a lot easier if unexpected challenges come up.
Using Personal Loans to Improve Your Credit
If you have bad credit, taking out a personal loan might feel like a last resort. However, if used responsibly, it can actually help improve your credit score over time. Here’s how it works and why it can be a smart move.
Building a Positive Payment History
One of the biggest factors in your credit score is your payment history. By making on-time payments on a personal loan, you’re showing lenders that you can handle debt responsibly. Every month you make a payment on time, it adds positive activity to your credit report, which can gradually improve your score.
Reducing Your Credit Utilization
If you’re using a personal loan to pay off high-interest credit cards, this can lower your credit utilization ratio. This ratio measures how much of your available credit you’re using, and a lower percentage is better for your score. For example, paying down credit card balances with a personal loan can lower your utilization, giving your credit score a boost.
Adding Credit Variety
Having a good mix of different types of credit also helps your credit score. Personal loans are considered installment credit, while credit cards are revolving credit. By adding a personal loan to your credit mix, you’re showing that you can manage different kinds of debt, which can further improve your credit profile.
Long-Term Benefits
While it might take time to see a significant jump in your credit score, the positive habits you build with a personal loan—making timely payments and reducing credit card debt—will pay off in the long run. Plus, as your credit score improves, you may be eligible for better loan terms and lower interest rates in the future.
By using personal loans wisely, you can not only handle immediate financial needs but also set yourself up for better credit opportunities down the road.
Final Thoughts
Personal loans can be a helpful tool for getting back on track financially, especially if you’re dealing with bad credit. By choosing a loan with reasonable interest rates, manageable monthly payments, and terms that fit your budget, you can cover your immediate needs while setting yourself up for future success.
Remember, making timely payments on your personal loan can boost your credit score, help reduce debt, and show lenders that you’re a responsible borrower. It’s not just about solving short-term financial challenges—it’s about building a stronger financial foundation for the long run.
Take some time to explore the loan options we’ve discussed, compare offers, and choose the one that fits your situation best. With careful planning, a personal loan could be the step you need to regain control of your finances and move toward a more secure future.
