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A Guide to High-Risk Loans

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When applying for a new loan, your credit score is one of the most important factors that a potential lender will consider. Your loan approval can hinge largely on this three-digit number, which also affects your borrowing power.

If you have a low credit score or no credit history, you may need to turn to a high-risk loan when borrowing money.

Here’s what to know about high-risk loans and how they compare to other types of credit products:

  • What are high-risk loans?
  • Am I a high-risk borrower?
  • Why choose a high-risk loan?
  • Drawbacks of a high-risk loan
  • Alternatives to high-risk loans
  • Should I get a high-risk loan?

What are high-risk loans?

Before approving your application for a credit card, personal loan, or other credit-based product, a lender will review your credit history to determine how likely you are to repay your debt as promised. The more risk you pose to a lender, the less likely you are to get approved.

Some types of high-risk loans may include:

  • Secured loans: These loans require an asset to be held as collateral, such as your home or car. If you default on your loan payments, the lender can take your collateral.
  • Car title loans: With these loans, you’ll give the lender your car title to secure funding. But you’ll pay high fees and interest, and the lender can take your car if you aren’t able to make your payments.
  • Payday loans: These are small-dollar, short-term loans with extremely high interest rates and fees. You should only consider them as a last resort.

Since these loans are offered to borrowers who may be at a higher risk of defaulting, lenders often charge higher interest rates and fees. This can help them offset potential losses while still offering loans to high-risk borrowers.

Am I a high-risk borrower?

A high-risk borrower can be defined in a few different ways, but it’s generally someone who a lender deems more likely to default on a loan product.

Lenders may consider you to be a high-risk borrower if you have bad credit, limited (or no) credit history, or a credit history that includes late payments, collections, defaults, judgments, or even bankruptcies. In some cases, lenders may consider you a high risk borrower if you apply for a loan but your income is too low.

Each lender sets its own criteria for borrower risk. Some may decide that any applicant with a credit score below 600 is high-risk. Others may base their lending decisions on your past accounts and payment history.

Why choose a high-risk loan?

If you need to borrow money as a high-risk borrower, here are some reasons you may opt for a high-risk loan:

  • It might be your only option. If you don’t qualify for a traditional personal loan — either due to your income, credit score, or credit history — you may have to consider a high-risk loan instead. Whether you need to pay unplanned bills or just want to lower interest rates on other balances, these loans still offer a traditional loan structure, while remaining accessible to higher-risk borrowers.
  • You can qualify with alternate criteria. High-risk loans may utilize other eligibility requirements and non-credit criteria to approve you for a loan, considering your broad financial picture rather than just your credit score. For example, you may only be required to prove that you have a steady income source, but there won’t be a minimum income requirement.
  • Repayment terms are better than with payday loans. A payday loan is a very short-term loan, often with repayment terms that last just a few weeks. In addition to their high interest rates, lenders expect quick repayment on these loans. On the other hand, you can often repay a high-risk loan over a period of years, giving you a manageable monthly payment.
  • It can save you from borrowing against other assets. Rather than pulling from a retirement account or other long-term asset, high-risk loans can give you the cash you need fast without affecting your future plans. In many cases, high-risk loans are unsecured, meaning that you don’t need to put up collateral to secure the debt.

The personal loan companies in the table below compete for your business through Credible. You can request rates from all of these partner lenders by filling out just one form (instead of one form for each) and without affecting your credit score.

Lender Fixed rates Loan amounts

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
9.95% – 35.99% APR $2,000 to $35,000**
  • Fixed APR: 9.95% – 35.99% APR
  • Variable APR: N/A
  • Min. credit score: 550
  • Loan amount: $2,000 to $35,000**
  • Loan terms (years): 2, 3, 4, 5*
  • Time to fund: As soon as the next business day (if approved by 4:30 p.m. CT on a weekday)
  • Fees: Origination fee
  • Discounts: Autopay
  • Eligibility: Available in all states except CO, IA, HI, VT, NV NY, WV
  • Customer service: Phone, email
  • Soft credit check: Yes
  • Loan servicer: Avant
  • Loan Uses: Debt consolidation, emergency expense, life event, home improvement, and other purposes
  • Min. Income: $1,200 monthly

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
7.99% – 15.19% APR $10,000 to $50,000
  • Fixed APR: 7.99% – 15.19% APR
  • Variable APR: N/A
  • Min. credit score: 700
  • Loan amount: $10,000 to $50,000
  • Loan terms (years): 3 to 6
  • Time to fund: Next business day
  • Fees: No prepayment penalty
  • Discounts: None
  • Eligibility: Available in all 50 states
  • Customer service: Phone
  • Soft credit check: Yes
  • Min. Income: Does not disclose
  • Loan Uses: Debt consolidation, home improvement, self-employment, and other purposes

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
7.99% – 35.99% APR $5,000 to $50,000
  • Fixed APR: 7.99% – 35.99% APR
  • Variable APR: N/A
  • Min. credit score: 600
  • Loan amount: $2,000 to $50,000
  • Loan terms (years): 2, 3, 4, 5
  • Time to fund: As soon as 1 to 3 business days after successful verification
  • Fees: Origination fee
  • Discounts: None
  • Eligibility: Available in all states except DC, IA, VT, and WV
  • Customer service: Phone
  • Soft credit check: Yes
  • Loan servicer: Best Egg and Blue Ridge Bank
  • Min. Income: None
  • Loan Uses: Credit card refinancing, debt consolidation, home improvement, and other purposes

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
5.99% – 24.99% APR $2,500 to $35,000
  • Fixed APR: 5.99% – 24.99% APR
  • Min. credit score: 660
  • Loan amount: $2,500 to $35,000
  • Loan terms (years): 3, 4, 5, 6, 7
  • Time to fund: As soon as the next business day after acceptance
  • Fees: Late fee
  • Discounts: None
  • Eligibility: Available in all 50 states
  • Customer service: Phone
  • Soft credit check: Yes
  • Loan Uses: Auto repair, credit card refinancing, debt consolidation, home remodel or repair, major purchase, medical expenses, taxes, vacation, and wedding

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
7.99% – 29.99% APR $7,500 to $50,000
  • Fixed APR: 7.99% – 29.99% APR
  • Min. credit score: Does not disclose
  • Loan amount: $10,000 to $50,000
  • Loan terms (years): 2, 3, 4, 5
  • Time to fund: As soon as 2 business days
  • Fees: Origination fee
  • Discounts: No
  • Eligibility: Available in all states except CO, CT, HI, KS, NH, NY, ND, OR, VT, WV, WI, and WY
  • Customer service: Phone
  • Soft credit check: Yes
  • Min. Income: None
  • Loan Uses: Debt consolidation, home improvement, wedding, travel, medical expenses, and other purposes

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
7.99% – 29.99% APR $5,000 to $40,000
  • Fixed APR: 7.99% – 29.99% APR
  • Min. credit score: 600
  • Loan amount: $5,000 to $40,000
  • Loan terms (years): 2, 3, 4, 5
  • Time to fund: As soon as 2 to 5 business days after verification
  • Fees: Origination fee
  • Discounts: None
  • Eligibility: Available in all states except MA and NV
  • Customer service: Phone, email, chat
  • Soft credit check: Yes
  • Min. Income: None
  • Loan Uses: Debt consolidation and credit card consolidation only

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
8.3% – 36.0% APR $1,000 to $40,000
  • Fixed APR: 8.3% – 36.0% APR
  • Min. credit score: 600
  • Loan amount: $1,000 to $40,000
  • Loan terms (years): 3, 5
  • Time to fund: Usually takes about 2 days†
  • Fees: Origination fee
  • Discounts: None
  • Eligibility: Available in all 50 states
  • Customer service: Phone, email
  • Soft credit check: Yes
  • Loan servicer: LendingClub Bank
  • Min. Income: None
  • Loan Uses: Debt consolidation, paying off credit cards, home improvement, pool loans, vacations, and other purposes

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
7.99% – 35.99% APR $2,000 to $36,500
  • Fixed APR: 7.99% – 35.99% APR
  • Min. credit score: 580
  • Loan amount: $2,000 to $36,500
  • Loan terms (years): 2, 3, 4, 5, 6
  • Time to fund: As soon as the next business day
  • Fees: Origination fee
  • Discounts: Autopay
  • Eligibility: Available in all states except NV and WV
  • Customer service: Phone, email
  • Soft credit check: Yes
  • Min. Income: $20,000
  • Loan Uses: Home improvement, consolidate debt, credit card refinancing, relocate, make a large purchase, and other purposes

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
5.24% – 19.99% APR $5,000 to $100,000
  • Fixed APR: 5.24% – 19.99% APR
  • Min. credit score: 660
  • Loan amount: $5,000 to $100,000
  • Loan terms (years): 2, 3, 4, 5, 6, 7*
  • Time to fund: As soon as the same business day
  • Fees: None
  • Discounts: Autopay
  • Eligibility: Available in all states except RI and VT
  • Customer service: Phone, email
  • Soft credit check: No
  • Loan servicer: LightStream
  • Min. Income: Does not disclose
  • Loan Uses: Credit card refinancing, debt consolidation, home improvement, and other purposes

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
6.99% – 24.99% APR1 $3,500 to $40,0002
  • Fixed APR: 6.99% – 24.99% APR1
  • Min. credit score: 660
    (TransUnion FICO®️ Score 9)
  • Loan amount: $3,500 to $40,0002
  • Loan terms (years): 3, 4, 5, 6
  • Time to fund: Many Marcus customers receive funds in as little as three days
  • Fees: None
  • Discounts: Autopay
  • Eligibility: Available in all 50 states
  • Customer service: Phone
  • Soft credit check: Yes
  • Loan servicer: Goldman Sachs
  • Min. Income: $30,000
  • Loan Uses: Credit card refinancing, debt consolidation, home improvement, major purchase, and other purposes

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
18.0% – 35.99% APR $1,500 to $20,000
  • Fixed APR: 18.0% – 35.99% APR
  • Min. credit score: None
  • Loan amount: $1,500 to $20,000
  • Loan terms (years): 2, 3, 4, 5
  • Time to fund: As soon as the same day, but usually requires a visit to a branch office
  • Fees: Origination fee
  • Discounts: None
  • Eligibility: Must have photo I.D. issued by U.S. federal, state or local government
  • Customer service: Phone, email
  • Soft credit check: Yes
  • Min. Income: Does not disclose

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
7.74% – 17.99% APR $600 to $50,000
(depending on loan term)
  • Fixed APR: 7.74% – 17.99% APR
  • Min. credit score: 660
  • Loan amount: $600 to $50,000*
  • Loan terms (years): 1, 2, 3, 4, 5
  • Time to fund: 2 to 4 business days after verification
  • Fees: None
  • Discounts: None
  • Eligibility: Does not disclose
  • Customer service: Phone, email
  • Soft credit check: No
  • Min. Income: Does not disclose
  • Loan Uses: Debt consolidation, home improvement, transportation, medical, dental, life events

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
6.99% – 35.99% APR $2,000 to $50,000
  • Fixed APR: 6.99% – 35.99% APR
  • Min. credit score: 640
  • Loan amount: $2,000 to $50,000
  • Loan terms (years): 2, 3, 4, 5
  • Time to fund: As soon as one business day
  • Fees: Origination fee
  • Discounts: None
  • Eligibility: Available in all states except IA, ND, WV
  • Customer service: Phone, email
  • Soft credit check: Yes
  • Min. Income: None
  • Loan Uses: Debt consolidation, home improvement, vehicles, small business, new baby expenses, and other purposes

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
5.99% – 35.99% APR $3,500 to $40,000
  • Fixed APR: 5.99% – 35.99% APR
  • Min. credit score: 600
  • Loan amount: $3,500 to $40,000
  • Loan terms (years): 2, 3, 4, 5
  • Time to fund: 90% funded within a day13
  • Fees: Origination Fee, $15 Late Fee, $25 NSF Fee
  • Discounts: None
  • Eligibility: Available in all states except CO, CT, ME, NV, NH, TN, VT, WV, WY, and all U.S. Territories
  • Customer service: Phone, email
  • Soft credit check: Yes
  • Loan servicer: Reach Financial
  • Min. Income: $1,000 monthly
  • Loan Uses: Debt consolidation, credit card refinancing

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
7.99% – 23.43% APR10 $5,000 to $100,000
  • Fixed APR: 7.99% – 23.43% APR10
  • Min. credit score: Does not disclose
  • Loan amount: $5,000 to $100,000
  • Loan terms (years): 2, 3, 4, 5, 6, 7
  • Time to fund: 3 business days
  • Fees: None
  • Discounts: Autopay
  • Eligibility: Available in all states except MS
  • Customer service: Phone, email
  • Soft credit check: Yes
  • Min. Income: Does not disclose
  • Loan Uses: Solely for personal, family, or household uses

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
11.69% – 35.93% APR7 $1,000 to $20,000

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
7.46% – 35.97% APR $1,000 to $50,000
  • Fixed APR: 7.46% – 35.97% APR
  • Min. credit score: 560
  • Loan amount: $1,000 to $50,000*
  • Loan terms (years): 2, 3, 5, 6
  • Time to fund: Within a day of clearing necessary verifications
  • Fees: Origination fee
  • Discounts: Autopay
  • Eligibility: Available in all states except West Virginia
  • Customer service: Email
  • Soft credit check: Yes
  • Min. Income: Does not disclose
  • Loan Uses: Debt consolidation, credit card refinancing, home improvement, and other purposes

Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology. View details
5.4% – 35.99% APR4 $1,000 to $50,0005
  • Fixed APR: 5.4% – 35.99% APR4
  • Min. credit score: 580
  • Loan amount: $1,000 to $50,0005
  • Loan terms (years): 3 to 5 years4
  • Time to fund: As fast as 1 business day6
  • Fees: Origination fee
  • Discounts: None
  • Eligibility: Available in all 50 states
  • Customer service: Phone, email
  • Soft credit check: Yes
  • Min. Income: $12,000
  • Loan Uses: Payoff credit cards, consolidate debt, take a course or bootcamp, relocate, make a large purchase, and other purposes
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All APRs reflect autopay and loyalty discounts where available | LightStream disclosure | 10SoFi Disclosures | Read more about Rates and Terms

Drawbacks of a high-risk loan

High-risk loans have several downsides that you should consider before you apply, including:

  • Interest rates can be very high. Borrowers with good credit can often take out personal loans with interest rates in the single digits. If you’re a high-risk borrower, however, your interest rates are generally much higher. Depending on the product and lender, these rates can even include an APR as high as (or higher than) credit cards.
  • Borrowing limits may be too low. The best personal loan lenders may offer loans for as much as $100,000 to borrowers who qualify. In contrast, high-risk loans may cap out at just a few thousand dollars. If you’re borrowing that money to cover a large expense or unexpected bill, it may not be enough.
  • You’ll often pay fees. Many personal loan lenders offer loans without any origination or application fees. But when it comes to high-risk loans, fees are more common and can add up quickly.
  • It could trap you in a cycle of debt. If you’re already having trouble keeping up with all your bills, adding a new loan to your debt load could make it even more challenging to pay all your bills on time.

Alternatives to high-risk loans

If you aren’t sure whether a high-risk loan is the right choice for your financial needs, here are some alternatives you may want to consider:

  • Introductory credit card offer: With an introductory credit card offer, you may be able to take advantage of a 0% APR on new purchases, balance transfers, or both. This can allow you to pay off existing debt or pay for a large purchase, without incurring any new finance charges. But you’ll typically need good or excellent credit to qualify.
  • Home equity loan or line of credit: Securing a loan or line of credit with an asset, such as your home, can help boost your approval odds and even lower your interest rate. So if you own a property that’s worth more than you owe, you may be able to tap into a home equity loan or line of credit (HELOC) to get the funds you need. But this can also be risky: If you fall behind on your payments, the lender can foreclose on your home.
  • Credit card cash advance: While credit cards often have higher interest rates than personal loans, you may be able to use a cash advance on an existing card if you need cash fast. This can also be more affordable than a new high-risk loan product in some cases. But the APR for a cash advance can be even higher than the card’s regular APR.
  • Debt management agency: Debt management services can set up a personalized and tailored payment plan that gets you out of debt with a manageable monthly payment. In some cases, they may even be able to unlock lower interest rates and help you build your credit. But these agencies sometimes charge fees, and there’s no guarantee that your creditors will negotiate with them. It’s important to do your research to make sure you’re working with a reputable agency.

Should I get a high-risk loan?

Whether or not a high-risk loan is right for you depends on your specific situation.

If you don’t qualify for a traditional personal loan but need cash for unexpected bills, large purchases, or debt consolidation, a high-risk personal loan may be the answer. They often cost more than traditional personal loans and may have limited repayment terms, but they’re likely a much better option than high-risk loans such as payday loans.

Be sure to weigh all your options and the potential cost of each before making your decision. Loans are available to borrowers of all backgrounds and financial statuses, but high-risk loans aren’t right for everyone.

Any time you shop for a loan product, it’s important to compare multiple lenders so you can make sure you’re getting the best loan for your unique situation.

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Trustpilot About the author Stephanie Colestock Stephanie Colestock

Stephanie Colestock is a Washington, D.C.-based writer who has more than 11 years of experience in writing about investing, business, and personal finances. She’s contributed to outlets such as Yahoo! Finance, MSN, Investopedia, Credit Karma, Credible, and more.

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