You can get small loans for bad credit from lenders such as Avant, LendingPoint and Upstart. But depending on how bad your credit is, you may have to get a secured personal loan instead of an unsecured one. Major lenders offering secured personal loans that people with poor credit can get include Wells Fargo and TD Bank.
With a secured loan, you must put up some kind of collateral that the lender can take possession of if you default. Because of the lowered risk of non-payment for the lender, secured personal loans are open to people with pretty much any credit score. However, there are still some unsecured personal loans available to people with scores between 585 and 639 (the end of the bad credit range).
Where to Get Small Loans for Bad Credit:
Minimum Loan Amount
Secured Loans Offered?
Minimum Credit Score
660- for TD customers, 750 for unsecured
N/A for secured
660 for unsecured*
N/A for secured
*According to multiple third-party sources
Some lenders that offer small, secured personal loans for bad credit have them only for the purpose of building credit. They require money in a bank account as collateral, so they're not useful for financing purchases. Other lenders will let you use other forms collateral to borrow money, though, such as real estate, vehicles, stocks or other valuable possessions.
Types of Small Loans for Bad Credit to Avoid
There are multiple places to get a small loan besides a bank, credit union, or reputable online lender. However, many of them are incredibly expensive options that are not even worth considering.
Payday loans: It's easy for people with bad credit to get a loan against their next paycheck from a payday lender. But they'll usually have to pay a fee that equates to a 400%+ APR in return. That still leaves you in a bad situation when the next payday comes around, and it can be difficult to break out of the cycle of borrowing.
Auto title loans: You can get a small loan for 2 - 4 weeks by putting your car up as collateral. If you're unable to pay back the loan, you can usually roll it over for another few months, but eventually the lender will repossess your vehicle. And if you're able to pay the loan back, you'll still have to shell out up to 25% of what you borrowed.
Pawn shops: Pawn shops purchase valuable items for a fraction of their actual value and then give you a few months to pay that money back with interest to reclaim the items. That interest is usually somewhere between 2% and 25% per month. The lender can sell your item to another customer if you don't reclaim it in the allotted time.
As a result, the safest place to get small loans for bad credit is definitely from personal loan providers.