Having a credit score of 580 or lower can make securing a personal loan challenging. However, there are options available specifically designed for individuals with poor credit. These loans often come with higher interest rates and fees, but they can be essential for covering unexpected expenses or consolidating debt. Here are four personal loans you can apply for if your credit score is 580 or lower, along with answers to five frequently asked questions.
Personal Loans To Apply To If Your Credit Score Is 580:
1. OneMain Financial
Overview: OneMain Financial is a popular choice for borrowers with poor credit. They offer secured and unsecured personal loans, with loan amounts ranging from $1,500 to $20,000. OneMain Financial evaluates your creditworthiness based on more than just your credit score, considering your income, expenses, and financial history.
Key Features:
- Loan Amounts: $1,500 to $20,000
- APR: 18% to 35.99%
- Loan Terms: 24 to 60 months
- Fees: Origination fees, late fees
Pros:
- Quick funding
- Available to those with poor credit
- Flexible loan terms
Cons:
- High APR
- Origination fees
2. Avant
Overview: Avant is another lender catering to those with lower credit scores. They offer unsecured personal loans that can be used for various purposes, including debt consolidation, home improvement, or unexpected expenses.
Key Features:
- Loan Amounts: $2,000 to $35,000
- APR: 9.95% to 35.99%
- Loan Terms: 24 to 60 months
- Fees: Administration fees up to 4.75%
Pros:
- Prequalification process
- Quick funding (as soon as the next business day)
- No prepayment penalties
Cons:
- High APR for low credit scores
- Administration fees
3. Upgrade
Overview: Upgrade offers personal loans to borrowers with poor credit, providing an easy online application process and fast funding. These loans can be used for various purposes, and Upgrade also offers free credit monitoring to help you improve your score.
Key Features:
- Loan Amounts: $1,000 to $50,000
- APR: 8.24% to 35.97%
- Loan Terms: 36 or 60 months
- Fees: Origination fees between 2.9% and 8%
Pros:
- Free credit monitoring
- Soft credit check for prequalification
- Fast funding
Cons:
- High origination fees
- Higher APR for lower credit scores
4. LendingPoint
Overview: LendingPoint specializes in providing personal loans to borrowers with credit scores as low as 580. They evaluate your creditworthiness based on a broader range of factors, including your job history and income.
Key Features:
- Loan Amounts: $2,000 to $36,500
- APR: 7.99% to 35.99%
- Loan Terms: 24 to 60 months
- Fees: Origination fees up to 6%
Pros:
- Flexible qualification criteria
- Quick funding
- No prepayment penalties
Cons:
- High APR
- Origination fees
FAQs:
What is the minimum credit score required to apply for these loans?
Most of these lenders are willing to work with borrowers who have credit scores as low as 580. However, other factors such as income, employment history, and debt-to-income ratio will also be considered during the application process.
How quickly can I get the funds?
The funding time varies by lender. OneMain Financial, Avant, Upgrade, and LendingPoint typically provide funds within one to two business days after approval.
Are there any fees associated with these loans?
Yes, these loans often come with fees such as origination fees, which can range from 2.9% to 8% of the loan amount. Additionally, there may be late fees if you miss a payment.
Can I prepay my loan without any penalties?
Most of these lenders do not charge prepayment penalties, allowing you to pay off your loan early without any extra costs. Avant, Upgrade, and LendingPoint specifically mention no prepayment penalties.
How can I improve my chances of getting approved?
To improve your chances of getting approved, ensure your application is complete and accurate, provide proof of stable income, reduce existing debt as much as possible, and consider applying with a co-signer if your credit score is very low.
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Conclusion
Securing a personal loan with a credit score of 580 or lower is possible, thanks to lenders like OneMain Financial, Avant, Upgrade, and LendingPoint. While these loans come with higher interest rates and fees, they provide a valuable financial resource for those in need. Always compare offers, read the terms and conditions carefully, and ensure you can manage the repayment schedule before committing to a loan.