Best personal loans for fair credit for 2024

Personal loans can be a great way to manage large upcoming expenses or to consolidate existing debt. If you want one of these products and your FICO Score is between 580 and 669, focus your attention on the lenders who will work with applicants with fair credit. There are quite a few financial institutions that do, but you will want to be sure that the lender is reputable and the terms are as attractive as possible.

Here is our selection for the best personal loans available to people with fair credit.

*APR depends on many factors: this is an estimate only based on research conducted on June 8, 2023. Ask your loan provider for your rate.

Best for income-based qualification: LendingPoint

When assessing loan applicants, LendingPoint concentrates heavily on a prospective borrower’s income. To qualify, you will need to have an annual income of at least $35,000, as well as a verifiable personal banking account in your name. The company’s focus on your ability to repay can be beneficial if your credit scores are fair.

Depending on your income and credit health, you may be eligible for a loan of between $2,000 and $36,500. The interest can be high though, ranging from 7.99% to 35.99%. Terms are from 24 to 72 months. If you can only get one of the higher rates, we appreciate that LendingPoint will review your payments after six months. If you’ve always made your payments on time, they may lower the APR.

The company does offer a soft pull process to evaluate your eligibility and what the terms would be, without any impact on your credit report and scores. If you do accept the terms, the loan may be subject to an origination fee up to 8% of the total loan amount. However, there are no prepayment penalties so if you wanted to pay it off early there would be no extra charges.

LendingPoint does not offer loans to residents of Nevada and West Virginia.

Best for fast funding: Best Egg

Applying for some personal loans can take a long time and you may have to wait many days before receiving the funds. The process for a Best Egg loan, however, is fast. You can apply online in minutes, and receive the funds in one business day.

Best Egg offers loans for diverse purposes, from debt consolidation to planning for the future. We like that this company is open to working with borrowers who have a wide span of credit ratings. The company’s personal financial tools (such as the free credit score monitoring and alert program) can keep you on track, too.

You may qualify for a Best Egg personal loan with a credit score under 700, but the APR will be in the upper ranges. You can learn what you're eligible for with the soft-pull process, so if you do qualify but the terms aren’t ideal, there will be no negative impact on your credit. Rates start at 8.99% and go up to 35.99%. If you use the loan for debt consolidation and enroll in direct payments, which enables Best Egg to send the payments to your creditors, you should receive an interest rate discount of 0.5%.

Best Egg personal loan amounts are $2,000 to $35,000, though they vary by state. If you get a special offer code, a loan of up to $50,000 may be available. Repayment terms are a minimum of 36 months to a maximum of 60 months. There is an origination fee of 0.99% to 8.99%, and no prepayment penalty fees.

Best Egg personal loans are not available in Iowa, Vermont, West Virginia or Washington, D.C.

Best for credit card debt consolidation: Happy Money

Hanging onto high interest credit card balances can be a burden. That's where Happy Money personal loans come in. This company specializes in debt consolidation with their “Payoff Loan,” helping individuals repay their obligations and increase their credit scores.

You can borrow between $5,000 and $40,000 from their lending partners (a variety of credit unions) with terms between two and five years. Interest rates begin at 11.50%, which may be substantially lower than what you have on your cards, though rates can be as high as 24.50% for applicants with lower credit scores.

To qualify, you should have no unresolved delinquencies on your credit report and your scores should be at least 640. Happy Money will also review your debt-to-income ratio, credit history, open and satisfactory trades ( defined as “the lines of credit [like] mortgage, auto loan, etc. that you’ve opened and made payments for on time”), and credit utilization, which is how much of your credit line is currently open. There is no hard credit check to find out what you may get until you actually apply.

Origination fees range from 0% and 5%. There are no prepayment fees. Happy Money loans are available in all states except Massachusetts and Nevada.

Best for personal service: Achieve

When seeking a personal loan, especially for the first time and when your credit is fair, you may need extra hand holding. Some digital-only banks do not have a robust – or any – human-to-human contact. That's not the case for Achieve. Their loan consultants are available Monday through Friday, from 6 a.m. to 8 p.m., MST to answer questions and provide guidance.

In addition to the excellent customer service, Achieve offers four different repayment terms: 2, 3, 4 or 5 years, and you can select a payment date that works for you.

If you decide to take out the loan, you will be charged an origination fee of 1.99% to 5.99%. However, there are no prepayment fees if you wish to pay the debt off sooner than the term.

We also like that you can add a co-borrower to the loan. If the other applicant has a better credit score, the interest rate (which ranges from 7.99% to 29.99%) may be lower than the rate you would get with fair credit. You may also get a better rate if you have enough savings in your retirement account.

Achieve loans, assuming you qualify, can be quickly funded. As long as you complete an application with all the required documentation, and if it's early in the working day, you may receive a decision that same day. Be aware, though, that these loans are not currently available to residents of Colorado, Connecticut, Hawaii, Kansas, Maine, North Dakota, Vermont, West Virginia, Wisconsin, and Wyoming.

Best for peer-to-peer lending: Prosper

If you're looking for an alternative to a conventional financial institution, we recommend Prosper.

As the first peer-to-peer lending platform to operate in the U.S., Prosper has a long history of connecting traditional and individual investors to people seeking personal loans. That translates into flexibility for consumers. Prosper recognizes that each borrower is different, and it is willing to loan to people with a credit score that is at least 600.

If you don’t qualify, you have the option to apply with someone who is eligible, so the account will be in both of your names.

Prosper personal loans have fixed interest rates of 6.99% to 35.99%, and terms of 2 to 5 years. The company will charge an origination fee, which may be between 1% and 5% of the loan amount.

Prosper loans are available to all borrowers except residents of Iowa and West Virginia.

Best for extra long repayment terms: Wells Fargo

If you want to stretch your loan out for up to seven years, a Wells Fargo personal loan is worth checking out. Terms range from 12 to 84 months. Since these loans can also be very large, up to $100,000, an extra long term can help with keeping payments reasonable. Another reason we like these loans is that they are free of many common fees. You will not be charged an origination or closing fee, nor will you be financially penalized if you choose to pay the loan off before the term ends.

The interest rates are attractive, too, starting at 7.49% and topping out at 23.74%. If you set up automatic payments from your qualified Wells Fargo checking account, you may get a 0.25 to 0.5 percentage point discount on the APR. You can also choose your own due date.

The online pre-qualification tool will let you know if you qualify, and if you do, the loan amount and interest rate. You get all that without a hard inquiry placed on your file.

Wells Fargo personal loans are only available to the bank's existing customers. If you are not one now, and are interested in the loan, open an account first.

How to choose a fair credit personal loan for you

Review all of the terms, and focus on the APR. The lower it is the less you will pay in financing fees. Also review the origination fee, if there is one, since it will be deducted from the amount you borrow. Evaluate the payments you will need to make based on the repayment term, and make sure you can afford them every month. Longer repayment terms will result in more interest paid, however, so the term should be commensurate with your financial capability.

How to get a personal loan with fair credit

When your credit score is fair, the interest rates may not be as slow as you want them to be. Therefore, it can work in your best interest to seek a lender that evaluates different criteria. For example, a lender that concentrates on your income or assets may give you a loan with an attractive rate.

How to improve your fair credit score for better loan rates

There are two basic reasons you may have a fair credit score. One is that you haven't had and used credit products for long enough to create a higher credit score. In that case, you may want to maintain credit accounts that you already have for a few more months so you can have more on-time payments listed on your credit report.

The other reason for a fair credit score is that your payment history is spotty or you owe too much on your current credit cards, causing your credit utilization ratio to be too small. You can raise your credit score by paying on time from this point forward, and deleting the balances you owe on your credit cards, so that the amount you owe is under 30% of your available credit.

Personal loans for fair credit alternatives

If you cannot qualify for a personal loan, or the terms are not helpful, consider your options:

• Negotiate with your creditors. If you want the loan to repay expensive debt, ask your creditors if they will reduce the interest rate.
• Explore credit counseling. Debt management plans offered by nonprofit credit counseling agencies can help you repay credit card balances at a reduced interest rate.
• Sell unnecessary property. When you need money fast and you have items that you don't need, consider selling them.
• Ask a friend or a family member for a loan. If they will give you money without interest attached, all you need to do is repay the principal.
• Borrow against your home. If you have a home with equity, you may consider a second mortgage or home equity line of credit.
• Explore a retirement plan loan. If you have a 401(k) or 403(b) plan through work, you may be able to borrow from your retirement savings.

Methodology

We evaluated the wide span of personal loan products currently available, then determined those that were best for different borrowers. The lenders had to be reputable and offer loans that people could use to their overall advantage. Transparency is key, so we only recommended personal loans where all the terms were upfront and understandable.

Frequently asked questions (FAQs)

What Is a Fair Credit Score?

FICO Scores range from 300 to 850, and scores that are 580 to 669 are considered fair.

Can you get approved for a loan with a fair credit score?

Consumers can be approved for loans with fair credit scores, but the interest rates may be higher than desired.

How does a personal loan affect your credit score?

Lenders send information about personal loans to the credit bureaus, and that information will be inputted into credit scoring algorithms. Because installment loans are not revolving debt products, the amount you owe is not considered in credit utilization. When you make monthly payments on time, a loan can have a positive impact on your credit score.

Can you get a loan with a 600 credit score?

It is possible to get a loan when you have a credit score of 600, but your options will be fewer than if your credit score was higher, and the terms won't be as attractive. For this reason it is recommended that you take steps to increase your score before applying for a loan.