Bad credit personal loans are a kind of personal loan marketed to individuals who possess abysmal bad credit scores. Usually, people get bad credit personal loans for fixing a car or a home, for making a large purchase, for paying off unexpected expenses, or for consolidating debt. Usually, a bad credit score is a FICO the chief credit scoring system in the US) score less than 640. FICO credit scores are defined as such:

• Very Poor (300 to 579)
• Fair (580 to 669)
• Good (670 to 739)
• Very Good (740 to 799)
• Exceptional (800 to 850)

How do bad credit personal loans work?

• While one’s credit scores could go as low as 300, one typically needs a minimum 600 FICO score for qualifying for bad credit loans. Every lender has a look at one’s FICO scores for determining what level of risk they are willing to bear.
• If an individual is able to qualify for a loan despite having bad credit, then one might have to make larger down payments and shell out higher interest rates for the loan.
• Bad credit loans usually have shorter loan terms and higher interest rates than loans offered to those who possess good credit. According to Bankrate, the typical bad credit loan terms are 2–5 years with an average annual percentage rate of 25%. Compared to that, personal loans for people with good credit scores usually have term lengths of 1–7 years with an average APR of 4.29%.

Best bad credit personal loans of 2019
There exist money lenders in the country who offer bad credit personal loans. Based on repayment methods, fees, loan terms, and more, this list analyzes companies lending bad personal loans with the following factors – online applications, features including online pre-approvals and cosigners, a maximum debt-to-income ratio of 40%, and a minimum FICO credit score of 620 or less. Some of the best ones are listed below:

Upstart
Upstart was established in 2012, catering to borrowers with no or short credit histories. These loan funds can be employed for consolidating debt. Upstart’s requirements are listed below:

• Minimum FICO credit score: 620
• Maximum debt-to-income ratio: NA
• Option for co-signer: No
• Preapproval or rate quotes: Yes
• Loan amounts: $1,000–$50,000
• Loan terms: 3–5 years
• Discounts: None
• Origination fee: 0–8%

LendingPoint
The online lending company of LendingPoint caters to those with fair or poor credit and who want to focus on rebuilding their credit. These loans can be employed for any legal personal purchase or expense. LendingPoint’s requirements are listed below:

• Minimum FICO credit score: 585
• Maximum debt-to-income ratio: 35%
• Option for co-signer: No
• Preapproval or rate quotes: Yes
• Loan amounts: $2,000–$25,000
• Loan terms: 2–4 years
• Discounts: None
• Origination fee: 0–6%

FreedomPlus
Established in 2013, FreedomPlus provides personal loans for consolidating debt. FreedomPlus’ terms are listed below:

• Minimum FICO credit score: 620
• Maximum debt-to-income ratio: 45%
• Option for cosigner: Yes
• Preapproval or rate quotes: NA
• Loan amounts: $7,500–$40,000
• Loan terms: 2–5 years
• Discounts: Retirement assets discount, direct pay discount
• Origination fee: 0–5%