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It’s more difficult to qualify for a personal loan with a 550 credit score, but it is possible. (Shutterstock)

Having a low credit score doesn’t completely eliminate your personal loan options. Some lenders offer personal loans for people with credit scores as low as 550, which is considered a poor score. But these lenders typically charge higher interest rates to offset their risk of lending to a borrower with bad credit.

Here’s some more insight into your personal loan options if you have a credit score of 550.

Credible makes it easy to compare personal loan rates from various lenders, all in one place. 

Can you get a personal loan with bad credit?Best personal loans for a 550 credit scoreBest personal loans for credit scores under 600How to apply for a personal loan with a 550 credit score Can you get a personal loan with bad credit?

Some lenders offer loans to consumers with poor credit scores, but you’ll likely get a higher interest rate and less-favorable terms than someone with good credit. All lenders have different credit score requirements, but scores below 600 for both the FICO and VantageScore credit-scoring models are generally considered to be poor or very poor. 

If you’re struggling to qualify for a personal loan with decent interest rates because you have a bad credit score, adding a cosigner with good credit to your personal loan application can improve your chances of qualifying for lower interest rates.

Best personal loans for a 550 credit score

The following two Credible partner lenders accept personal loan applicants with a 550 credit score

AvantMinimum credit score: 550Loan amounts: $2,000 to $35,000Loan terms: 2 to 5 yearsFees: Origination feeOneMain Financial Minimum credit score: NoneLoan amounts: $1,500 to $20,000Loan terms: 2 to 5 yearsFees: Origination feeBest personal loans for credit scores under 600

These six Credible partner lenders accept credit scores between 550 and 600 for their personal loans:  

Best EggMinimum credit score: 600Loan amounts: $2,000 to $50,000Loan terms: 2 to 5 yearsFees: Origination feeLendingClubMinimum credit score: 600Loan amounts: $1,000 to $40,000Loan terms: 3 or 5 yearsFees: Origination feeLendingPointMinimum credit score: 580Loan amounts: $2,000 to $36,500Loan terms: 2 to 6 yearsFees: Origination fee Universal CreditMinimum credit score: 560Loan amounts: $1,000 to $50,000Loan terms: 3 to 5 yearsFees: Origination feeUpgradeMinimum credit score: 560Loan amounts: $1,000 to $50,000Loan terms: 2 to 6 yearsFees: Origination feeUpstartMinimum credit score: 580Loan amounts: $1,000 to $50,000Loan terms: 3 to 5 yearsFees: Origination fee

Visit Credible to see your prequalified personal loan rates from various lenders, without affecting your credit.

Other lenders to consider

The following two lenders aren’t Credible partners, so you won’t be able to easily compare your rates with them on the Credible platform. But they may also be worth considering if you’re looking for a personal loan with a 550 credit score.

NetCredit

Minimum credit score: Does not discloseLoan amounts: $1,000 to $10,000Loan terms: 6 to 60 monthsFees: Origination fee (in some states)

Oportun

Minimum credit score: Does not discloseLoan amounts: $300 to $12,000Loan terms: 24 to 54 monthsFees: Origination feeMethodology

Credible evaluated the best personal loan lenders for a 550 credit score based on factors such as customer experience, minimum fixed rate, maximum loan amount, funding time, loan terms, and fees. Credible’s team of experts gathered information from each lender’s website, customer service department, and via email support. Each data point was verified to make sure it was up to date.

How to apply for a personal loan with a 550 credit score

If you’re going to apply for a personal loan in the near future and you have a 550 credit score, you may want to pause these plans until you can improve your credit. The higher your score is, the easier it is to qualify for lending products and secure better interest rates. 

Opening a secured personal loan, secured credit card, or credit-builder loan can help you improve your credit before you apply for an unsecured personal loan. You can also become an authorized user on a family member’s credit card to improve your credit score. 

When it’s time to apply for a personal loan, the application process can look different depending on which lender you apply with. But you can generally expect to take the following steps: 

Shop around. Research different lenders to find ones that lend to borrowers with lower credit scores.Get prequalified. Once you’ve found a few lenders, complete their prequalification forms to see what rates and terms you might qualify for.Complete the application. Most lenders have online applications that are easy and fast to complete. You’ll need to provide information that proves your identity and income, such as a copy of a government-issued photo ID, recent pay stubs, tax returns, or bank statements.Close on the loan and receive funds. If you’re approved for a loan, you’ll sign a loan agreement and the lender will disburse your funds, typically through direct deposit to your bank account. You’ll then begin making payments on the loan as agreed.

Remember, you also have the option to apply with a cosigner. If the cosigner has a good credit score, this can help you qualify for better interest rates as the lender can be assured that someone with a strong credit history will be responsible for making the loan payments if you aren’t able to. 

If you’re ready to apply for a personal loan, Credible lets you quickly and easily compare personal loan rates to find one that works for your situation.

Source Link:
https://www.foxbusiness.com/personal-finance/personal-loan-lenders-550-credit-score

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