When accessing credit facilities, lenders typically consider your credit score and collateral in certain instances. Of these two, your credit score is the priority. Therefore, you’ll have difficulty getting approval for your loan application if you have a poor credit score. Additionally, approval is likely to be on the condition that you accept a high-interest rate charge or the origination fees.

You’ll still access personal loans, but your situation shouldn’t be that tough. This article discusses how to get Personal Loans With Bad Credit, what a poor credit score means, and what you can do about it.

What Is a Low Credit Score?

According to the Consumer Financial Protection Bureau, a credit score summarizes a person’s credit worthiness. Therefore, a low credit score means financial institutions find it risky to extend credit facilities to you.

You obtain a credit score from credit scoring companies, the most common being FICO and VantageScore. Each company uses special criteria to calculate your score, the most common range being 300 to 850. Typically, any score below 580 is poor and will cause you to pay high-interest rates or reject your application.

While credit scoring companies have different calculation methods, they tend to use the same factors:

  • How long you’ve gone without settling the loans, you owe
  • How often you default on paying your bills
  • The total minimum loan amounts you owe to different entities
  • What portion of all credit available to you have you utilized
  • How recent other prospective lenders asked for your credit report
  • How many other loans have you applied for
  • The nature of all the credit facilities you currently use
  • Past cases of bankruptcies, collections, and foreclosures, if any

How Does It Affect Your Access to Personal Loans With Bad Credit?

As mentioned, any score below 580 is poor. Therefore, the higher you score, the more willing online lenders will be to give you personal loans with the best origination fee and other credit facilities. In contrast, a poor credit score limits your access to credit facilities and favorable payment terms. Additionally, it frustrates your plans to improve your situation, often sinking you further into worse credit scores. You’ll need a clever approach and resilience to pull yourself out of a poor credit score.

What Personal Loans Can You Access With a Poor Credit Score?

There are several personal loans for bad credit you can access, depending on the urgency of your situation. Typically, the more urgent the need, the less control you have over the terms a lender offers. Therefore, if you can avoid it, refrain from applying for a loan agreement until you fix your credit score. We’ll discuss more on that later. Here are some personal loans you can access in an emergency:

Payday Loans

A payday loan is a short-term personal loan that you borrow and pay by your next payday. This loan comes with a high-interest rate and is suitable for handling an emergency. You’ll receive a fraction of your regular earnings as the loan. You need to show the lender proof of a regular income and a checking bank account to qualify for one. The high-interest charge is because of the risky nature of the loan. Most payday loan applicants can’t access conventional loans or can’t wait for too long.

Credit Card Advance

This personal loan is similar to a payday loan, only that you access it through your credit card. Therefore, instead of using the card for payments, you approach a bank or ATM to receive a cash advance. Expect to pay a higher interest rate than you purchase directly with the card.

Personal Line of Credit

This product is a revolving credit that behaves like a credit card and is less like receiving a lump sum as a loan. Therefore, you’ll maintain a line of credit that you can access on a needs basis. You’re expected to pay only the interest on your borrowed credit card debt. Additionally, the best personal line of credit loans works best for recurring expenses.

What Can You Do Long Term?

You may notice that you don’t have many options when you have a poor credit score. Your situation gets worse when you need to settle an emergency. However, you’ll access maximum loan amount of personal loans and better terms in the long term. It all depends on how soon you can repair your poor credit score.

Improve Your Credit Score

The higher your credit score, the more credit facilities and better terms you’ll access. Here is what you can do:

  • Review your report for errors and omissions. For example, your report may include closed savings or checking account, erroneous accounts, and credit limits.
  • Handle all undue payments and maintain the discipline of timely bill payments. Your loan and bill payment history is a significant consideration for credit scorers. Therefore, get on top of it all, and discuss with the payday lenders more favorable payment terms otherwise.
  • Apply for a loan with a co-signer. Ensure the co-signer has a stellar credit score, which should pull up yours. Remember to make timely payments on the loan to avoid affecting the co-signer’s credit score.
  • Ask to be an authorized user on a credit card. Your friends and family are suitable candidates. By becoming an authorized user, the credit card holder’s excellent credit score will boost yours.

Pay Your Loans on Time

Make timely payments if you took an emergency personal loan or were already servicing another. Each payment is a positive addition to your credit history, thus a boost to your overall score. Therefore, you’ll access better terms in the future.

Evaluate All Accessible Loans

A poor credit score may limit your access to low-interest rate loans. However, you shouldn’t accept the worst terms possible. Different financial institutions, such as credit unions, offer special terms, which may be favorable.

Consider Secured Loans

While you may have a poor credit score, presenting security may soften a lender’s stand. Therefore, shop for secured loans, where you’ll likely pay significantly lower interest rates.


While a low credit score may limit your access to favorable loan proceeds terms, it doesn’t entirely lock you out. You can access emergency personal loans as you repair your score. MoneyWise has some of the best strategies to help you along the way, among other financial solutions.