Quick Loans for Poor Credit are a type of lending that allows people with a less-than-perfect credit history to access funds quickly and easily. These loans are designed to provide fast cash to people who may not qualify for traditional bank loans due to a low credit score or other financial issues. While quick loans can be a lifesaver in times of financial hardship, they can also come with high-interest rates and fees, which can trap borrowers in a cycle of debt.
What Are Quick Loans for Poor Credit?
One kind of unsecured personal loan that doesn’t require security is quick loans for people with bad credit. These are often small, short-term loans with quick access to funds that range in size from a few hundred to a few thousand dollars. Quick loans are a great choice for those who need money urgently because they can be authorized much faster than typical bank loans, which can take weeks or even months.
Several lenders, including online lenders, payday lenders, and credit unions, provide quick loans for borrowers with bad credit. They frequently have high interest rates and costs because they are unsecured loans. This because lenders take on greater risk when lending to people with poor credit histories, so they charge higher rates to compensate for that risk.
How to Qualify for a Quick Loan for Poor Credit?
You normally need to fulfill the following criteria in order to be eligible for a quick loan with bad credit:
- Having a consistent source of income: Lenders want to know that you will be able to pay back the loan, thus they want to know that you do. This may come through a job, a side business, or government assistance.
- Age of at least eighteen: To apply for a loan, you must be at least 18 years old.
- Have a bank account: In order to receive loan funds and make payments, most lenders require you to have a checking account.
- Have a working phone number and email address A working phone number and email address are required so the lender can get in touch with you regarding the loan.
- Provide proof of identity: You will need to provide proof of identity, such as a driver’s license or passport.
While these are the basic requirements for most quick loans for poor credit, each lender may have their own specific requirements, so it is important to check with the lender before applying.
The 3 Best Quick Loans for Poor Credit You Should Know
One of the few businesses, Upstart, bases its decision on criteria other than your credit score. Furthermore, it provides fairly inexpensive interest rates. It takes into account things like work history, credit history, employment history, and education. To be eligible for a loan, you typically need a credit score of around 300, though you can still be approved even with a short credit history. Upstart can run a light credit check if you want to know your APR before you apply. The business will run a hard credit inquiry after you apply for the loan, momentarily lowering your credit score.
You can choose a three-year or five-year loan and borrow anywhere from $1,000 to $50,000. Plus, Upstart has fast service — you’ll get your money the next business day if you accept the loan before 5 p.m. EST Monday through Friday.
The interest rate and fees, however, can add up. The APR may range from 6.50% to 35.99%. The average 5-year loan offered on Upstart had an APR of 25.05%. If you’re more than 10 days late on a payment, you’ll owe 5% of the unpaid amount or $15, whichever is greater.
Depending on the terms of the loan, you may also be required to make an upfront origination fee payment of between 0% and 10%. Upstart has the benefit of not charging you a penalty fee if you decide to pay off your loan early.
2. OneMain Finance Personal Loans
If you want a variety of options for the length of the repayment period, OneMain Finance Personal Loans are a fantastic choice. There is no minimum credit score required by OneMain, and the terms of your loan are not solely based on your credit score. The business considers credit history, revenue, spending, and collateral if necessary. Also, you can check your loan prequalification without submitting a hard inquiry.
OneMain offers loans with term lengths of 24, 36, 48, or 60 months, and loan amounts ranging from $1,500 to $20,000 (state-specific limits apply). Also, there are no penalties for early payout.
The high APRs, origination fees, and late fees are the main downsides. The APR ranges from 18% to 35.99%, with 18% being the lowest. Origination costs can be a fixed fee between $25 and $500 or a percentage of the loan amount between 1% and 10%. In meanwhile, late fines range from a flat $5 to $30 per late payment to 1.5% to 15% of the late sum of your most recent monthly payment.
OneMain gives customers the choice to use collateral in exchange for improved loan terms even if the majority of personal loans are unsecured. Trucks, RVs, yachts, and campsites can be collateral.
3. Avant Personal Loans
For people in a bind, Avant Personal Loans may be a suitable choice. The next day, if your application is accepted by 4:30 p.m. CT, Monday through Friday, you will get your money. Without damaging your credit score, you can also find out if you prequalify.
Even with a low credit score, Avant will still consider your income and credit score when approving you. But, according to Avant, the majority of its clients have credit scores between 600 and 700. Loan durations span from 24 to 60 months, and loan amounts range from $2,000 to $35,000.
Origination fees range from 0% to 4.75%, which is not a significant amount. Hardly the lowest interest rate you’ll get, the APR goes from 9.95% to 35.95%, however, there are personal loans with greater minimum APRs. But be aware that there is a $25 late fee if your payment isn’t made within ten days of the due date.
Pros and Cons of Quick Loans for Poor Credit
Quick loans for poor credit can be a useful tool for people who need cash fast, but they also come with some drawbacks. Here are some of the pros and cons of quick loans for poor credit:
- Fast approval: Quick loans for poor credit are designed to be approved quickly, often within minutes or hours.
- No collateral required: Quick loans are unsecured, so you don’t need to put up any collateral to get approved.
- Available to people with poor credit: Quick loans for poor credit are available to people with less-than-perfect credit histories, making them a valuable resource for those who may not qualify for traditional bank loans.
- High-interest rates and fees: Quick loans for poor credit often come with high-interest rates and fees, which can add up quickly and trap borrowers in a cycle of debt.
- Limited loan amounts: Quick loans for poor credit are typically small loans, ranging from a few hundred dollars to a few thousand dollars, so they may not be sufficient for larger expenses.
- Short repayment terms: Quick loans for poor credit are designed to be repaid quickly, often within a few weeks or months, which can make them difficult to manage for some borrowers.