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How to Get High-Risk Loans

High-risk loans are a tricky part of both personal money matters. They help people with a bad or poor credit history or without enough things for collateral. A high-risk loan can provide crucial funds when regular means might not work. Yet, these loans come with a hitch – expect higher interest rates, harsh conditions, and a greater chance of money problems.

We will help you look deeper at high-risk loans. It explains what they are, why they’re used, and the tricky stuff surrounding them. We cover everything from personal loans for people with credit issues to personal loans for operations considered too risky by traditional lenders. Our goal is to highlight the chances high-risk loans offer and the pitfalls that borrowers and lenders must avoid. But first, check our top and see what companies offer a reliable high-risk loan.

Top Loan Offers for High-Risk Borrowers

★★★★★

Est.APR

6.40% – 35.99%

Loan amount

$1,000 – $50,000

Min Score

300


More About

PROS

  • Quick access to loan funds;
  • No prepayment penalties;
  • Flexible monthly payments;
  • Beyond credit score verification (soft credit check);
  • Flexible loan amounts.

CONS

  • Origination fees up to 10%;
  • High annual percentage rate;
  • Co-signers aren’t allowed;
  • Limited repayment loan terms.

OVERVIEW

Upstart is a financial platform that enables borrowers with weak credit to get personal loans with flexible payback options. Its key advantage is same-day funding, and there is simply a light credit check conducted throughout the application procedure.

WHO IT’S FOR

Poor credit borrowers who can’t qualify for traditional personal loans.

WHY WE LIKE IT

Upstart does not do credit checks on its customers. Instead, it examines applicants’ whole financial condition. In addition, customers can apply in the morning and receive their personal loan before the end of the day.

LENDER PERKS

  • Quick funding (same-day deposit available)
  • No origination fees
  • Soft credit checks performed

FEES

  • Origination fees up to 10%;
  • $15 late fee
  • $15 NSF fee

REQUIREMENTS

  • Be at least 18 years old;
  • Prove your US citizenship or permanent residence;
  • Provide your bank account information
  • Show your monthly income (at least $2,000 monthly income) by providing pay stubs, tax forms, or bank statements;
  • Have fair credit (at least 300);
  • Provide an active email address and phone number.

TIME OF RECIEVE FUNDS

One business day (same-day funding available)

Editor’s Thoughts

Upstart is a service that makes getting a loan easy and quick for customers. It uses over 49 factors like fast, soft credit checks and monthly payments to help people get approved for personal loans.  Got fair credit and need cash fast through a small personal loan? Upstart’s personal loans are designed for people just like you. With a credit score of 600 or more, you can skip the slow, hard credit check and get approved for a loan in no time. You might even get your loan on the same day.

★★★★☆

upgrade logo

Est.APR

8.49% – 35.99%

Loan amount

$1,000 – $50,000

Min Score

Doesn’t specified


More About

PROS

  • No prepayment penalties;
  • Multiple rate discounts;
  • Next-day funding;
  • The due date may be changed;
  • Direct payments for debt consolidation.

CONS

  • APRs may be high;
  • Origination fees are charged;
  • Late fees may be applied.

OVERVIEW

Upgrade is an online financial service that offers up to $50,000 loans to borrowers with good to fair credit. It provides several interest rate reductions and allows you to add a co-applicant or collateral to your application. Choose it if you need money quickly and are not concerned about relatively high interest rates.

WHOM IT SUITS

Fair-credit borrowers who need the money quickly.

WHY WE CHOOSE IT

Upgrade offers convenient maximum and minimum loan amounts along with flexible repayment terms. It also accepts fair credit borrowers and provides several interest rate discounts.

PERKS OFFERED

  • Rate discounts for auto pay, direct payment, and reward checking;
  • Allows to add a co-applicant;
  • Mobile app for managing your loan.

FEES

  • Origination fees: 1.85% to 9.99%;
  • Late payment fees: $10;
  • Non-sufficient funds fees: $10 per payment returned.

ELIGIBILITY REQUIREMENTS

  • Be a U.S. citizen, a permanent resident, or living in the U.S. on a valid visa;
  • Be at least 18 years old (19 in Alabama and some other states);
  • Give a working email address;
  • Provide valid bank account details;
  • Confirm a sufficient monthly income to cover your loan payments.

FUNDING TIMES

As soon as one business day after clearing verification.

Editor’s Thoughts

Upgrade is a trustworthy lender offering various personal loan options. It gives you flexibility with repayment schedules, potential interest rate reductions, and quick loan dispatch, often by the next business day.  Based in San Francisco, Upgrade is an online loan facilitator, not a direct lender. Its personal loan services are managed via lending partners like Cross River Bank and Blue Ridge Bank. Payday loans offered by Upgrade vary from $1,000 to $50,000. Even though the company caters to borrowers having good to fair credit, eligibility criteria can differ among its lender’s partners.

★★★★☆

onemain financial logo

Est.APR

18% – 35.99%

Loan amount

$1,500 – $20,000

Min Score

None


More About

PROS

  • Joint and secured loans are available;
  • Wide range of loan options for low credit;
  • Pre-qualifying doesn’t affect your credit score;
  • Convenient options for debt consolidation.

CONS

  • Relatively high interest rates;
  • Charges origination fees;
  • APRs are not disclosed when pre-qualify.

OVERVIEW

OneMain Financial is a reliable financial service that offers personal loans between $1,500 and $20,000 without minimum credit score requirements. With its joint applications, flexible repayment terms, and soft credit checks for pre-qualifying, it can suit borrowers with bad credit. Interest rates are usually high, though.

WHOM IT SUITS

Borrowers with credit issues who want to avoid predatory lenders.

WHY WE CHOOSE IT

The company offers a wide range of secured, unsecured, and joint loan options with flexible repayment terms. Its personal loans are available to underbanked borrowers.

PERKS OFFERED

  • Direct payment to creditors for debt consolidation;
  • Loan cancellation within 7 days;
  • Fast funding

FEES

  • Origination fees: 1% to 10%, or $25 to $500, depending on the state;
  • Late payment fees: $5 to $30, or 1.5% to 15% of your loan amount;
  • Non-sufficient funds fees: $10 to $50 per payment returned.

ELIGIBILITY REQUIREMENTS

  • At least 18 years also;
  • Permanent US resident;
  • Income confirmation;
  • Valid bank account or debit card.

FUNDING TIMES

Within one business day of approval via a direct deposit. Funding within several hours may be offered if you receive the funds on your debit card.

Editor’s Thoughts

OneMain Financial, acclaimed for its positive ratings and good reviews, serves as a reliable choice for folks with credit history issues who need a loan. Not strictly requiring a minimum credit score, it opens up for joint applications and offers secured loans. However, be mindful of the reasonably high minimum APRs associated with OneMain loans and the absence of interest rate markdowns. The company lends personal loans to everyone in the country except those in Alaska, Arkansas, Connecticut, Massachusetts, Rhode Island, Vermont, and Washington DC. It has an online presence and approximately 1,400 physical locations across 44 states.

★★★★★

rise credit logo

Est.APR

58.90% – 299.00%

Loan amount

$300 – $5,000

Min Score

None


More About

PROS

  • Quick access to loan funds;
  • No prepayment penalties;
  • Flexible monthly payments;
  • Beyond credit verification (soft credit check).

CONS

  • High-interest rates;
  • Small loans amounts;
  • Not available in all states.

OVERVIEW

Rise is a financial platform that helps borrowers with bad credit get personal loans with flexible repayment terms. Its main advantage is the lack of additional fees, and a minor credit check is performed throughout the application process.

WHO IT’S FOR

Poor credit borrowers who can’t qualify for traditional personal loans.

WHY WE LIKE IT

Rise does not conduct traditional credit checks on its clients. Instead, it looks at applicants’ overall financial situation. Customers can also apply in the morning and obtain their personal loan before the end of the day.

PERKS OFFERED

  • Quick funding;
  • No origination fees;
  • Soft credit checks performed.

FEES

  • No fees for late payments or prepayment.

REQUIREMENTS

  • Be at least 18 years old;
  • Prove your US citizenship or permanent residence;
  • Provide your bank account information
  • Show your monthly income (at least $2,000 monthly income) by providing pay stubs, tax forms, or bank statements;
  • Have fair credit (at least 300);
  • Provide an active email address and phone number.

TIME OF RECEIVING FUNDS

One business day (same-day funding not available).

Editor’s Thoughts

Rise makes personal loans accessible with low credit score requirements, providing competitive interest rates and free early payoffs. Their installment and payday loans offer flexible repayment schedules and easy monthly payments.

Unlike traditional lenders, Rise works with people with low credit scores, giving practical personal loan choices with adaptable conditions. Good credit isn’t required because they don’t focus on the borrower’s credit rating. If you pay your installment loans on time, Rise shares this with credit reporting agencies. Sometimes, a high-risk loan can help boost your credit score, particularly with loans designed for those with imperfect credit.

★★★★☆

netcredit logo

Est.APR

34.00 – 99.99%

Loan amount

$1,000 – $10,000

Min Score

Not specified


More About

PROS

  • Next-day funding
  • No application fees or prepayment penalties
  • Bad credit is accepted
  • Flexible repayment terms
  • Convenient minimum loan amounts

CONS

  • Very high APRs
  • Low loan maximums
  • Origination and late payments fees may be charged
  • Not available in all states

OVERVIEW

NetCredit is an online lending company that specializes in small personal loans and credit lines for bad credit borrowers. The service offers flexible loan amounts and repayment terms and may work for emergencies due to its fast disbursement times. However, interest rates and fees are higher compared to most competitors.

WHOM IT SUITS

Borrowers with bad credit in need of fast cash.

WHY WE CHOOSE IT

NetCredit offers cheaper alternatives to regular personal loans and provides bad credit individuals with more flexibility. Additionally, it has fast funding times and allows borrowers to improve their credit.

PERKS OFFERED

  • The ability to change the due date
  • Refinancing with the same lender in some states
  • Credit-building opportunities

FEES

  • Origination fees: 1% to 5%, depending on your state
  • Cash advance fees: 10%
  • Late payment fees: vary by state
  • Non-sufficient funds fees: None

ELIGIBILITY REQUIREMENTS

  • Be a U.S. permanent resident
  • Live in a qualifying area
  • Be at least 18 years old
  • Have a valid email address
  • Have a valid personal checking account
  • Provide income confirmation

FUNDING TIMES

As soon as the next business day of approval.

Editor’s Thoughts

NetCredit, a remarkable online lender, proudly shares over 16,000 thumbs-ups from Trustpilot. They focus on folks with less-than-perfect credit, offering small loans quickly and fee-free. But bear in mind loans stop at $10,000. Recognize that NetCredit is a sound financial fix, but caution is critical. People with low credit might face high-interest rates, going beyond half their loan’s principal sum. Therefore, think of NetCredit loans as your last option.

★★★★☆

sofi logo

Est.APR

8.99-25.81%

Loan amount

$5,000-100,000

Min Score

None


More About

PROS

  • Low interest rates
  • Co-borrowers are allowed
  • No prepayment penalties
  • Flexible loan amounts
  • Wide repayment terms
  • No origination fee

CONS

  • Good credit is required
  • Late fees might apply
  • No co-signer option available
  • No physical branches

OVERVIEW

SoFi is a financial website that provides unsecured personal loans with a credit score minimum of 680. Personal loans from SoFi are also accessible with a co-borrower with good to outstanding credit. Personal loan candidates must, however, have an adequate income and a modest debt-to-income ratio.

WHO IT’S FOR

Applicants with good to excellent credit scores who want to consolidate debt, make major purchases, and cover significant medical bills.

WHY WE LIKE IT

SoFi does not do credit checks on its customers. Instead, it examines applicants’ whole financial condition. If you take out a credit builder loan, this service reports your on-time payments to the major credit reporting bureaus.

LENDER PERKS

  • No prepayment penalties
  • No origination fees
  • Low interest rates
  • Co-borrower option available

FEES

  • Optional fees (up to 6%)

REQUIREMENTS

  • Be at least 18 years old
  • Prove your US citizenship or permanent residence
  • Provide your bank account information and social security number
  • Show your monthly income by providing pay stubs, tax forms, or bank statements
  • Provide an active email address and phone number

TIME OF RECIEVING FUNDS

One business day

Editor’s Thoughts

SoFi offers many kinds of personal loans. You can borrow from $5,000 to $100,000. It can take 24 to 84 months to pay them back. They also give free career and financial advice. If you lose your job, they can help. They also offer discounts for will planning. Use SoFi loans for things like paying off debts, adoption, IVF, travel or medical costs, and weddings.

There are no set fees with SoFi. You can pay a fee of up to 6% of the loan to get a lower interest rate. This fee is deducted from the high-risk loan before you get it. Paying on time with SoFi matters. You might get discounts. If you set up monthly automatic payments, you can lower your interest rate by 0.25%. If you use SoFi to pay off other debts, they might give you another 0.25% discount.

★★★★☆

Lendingtree logo

Est.APR

5.99% – 35.99%

Loan amount

$1,000 – $50,000

Min Score

300


More About

PROS

  • Prequalification for multiple personal loans on single platforms
  • Low minimum interest rates
  • No prepayment penalties
  • Fast funding (same-day direct deposit may be available) 

CONS

  • High maximum interest rates
  • Many additional fees (potential origination fee)
  • No co-borrower permitted

OVERVIEW

LendingTre­e serves as a handy platform for seeking personal loans, allowing borrowers to explore a variety of loan offe­rs simultaneously. Many lenders associated with LendingTree can provide loans swiftly. However, the most suitable personal loan depends on your credit score. This score establishe­s eligibility and influences your interest rate.

WHO IT’S FOR

Borrowers with bad credit scores who want to consolidate debt of up to $50,000 or cover other significant expenses.

WHY WE LIKE IT

LendingTre­e has accreditation from the Be­tter Business Bureau, a non-profit group dedicated to customer safety and trust. The BBB rates LendingTree­ as A+, a symbol of excellence­. The BBB’s decisions are base­d on how a company reacts to customer gripes, truth in marke­ting, and openness about company procedure­s.

COMPANY PERKS

  • No prepayment penalties
  • Loan funds in one business day

FEES

  • Origination fees, prepayment penalties, or other fees may be applicable

REQUIREMENTS

  • Be at least 18 years old
  • Prove your US citizenship or permanent residence
  • Provide your bank account information
  • Show your monthly income (at least $25,000 annually income) by providing pay stubs, tax forms, or bank statements
  • Have fair credit (at least 300)
  • Provide an active email address and phone number

TIME OF RECIEVING FUNDS

One business day (same-day funding available)

Editor’s Thoughts

LendingTree lends amounts from $1,000 to $50,000. It serves folks in every US state through its network of partners. Your low credit score and the money you make every year determine your Annual Percentage Rate (APR). With rates varying from 5.99% to 35.99%, it’s a workable choice for people with a few credit score blemishes. The terms of LendingTree’s loans span from 12 months to 144 months. And hey, you can totally pay off your whole loan early with no penalties.

BadCredify evaluates lenders based on more than 70 rating criteria, including interest rates, repayment terms, eligibility requirements, fees, consumer experience, affordability, and more. Find out more about our full methodology.

Learn more about our methodology

What is a High-Risk Loan?

High-risk loans are financial products that usually have higher interest rates and tougher conditions because of the borrower’s low credit score. It helps lenders make up for any big risks. They might also ask for more collateral to lessen any loss from non-payment. People thinking about high-risk loans should think hard if they can keep up with payments. Maybe other finance options might be better.

In lending, a high-risk loan isn’t favorable for the lender. There’s a big chance the borrower might not pay back. This usually happens when the person or company borrowing doesn’t have a good credit history or solid financial standing.

Who is Considered High-Risk Borrower?

A person or group labelled as a high-risk borrower is believed to possibly fail repaying a loan. To guess the probability of loan repayment, lenders use particular methods. These pointers help pinpoint high-risk borrowers:

  • Credit Status. High-risk tags are often associated with those with bad credit history or low scores. Delayed payments, defaults, bankruptcy, massive unpaid debt – these threats can hurt their credit standing.
  • Income Level. Unpredictable or low income risks label the borrower as high risk. To guarantee repayment, lenders favor enough, steady income.
  • Debt-Income Balance. High debt compared to income could suggest additional debt challenges. A borrower with a low debt-to-income ratio is preferable to lenders.
  • Job Security. Multiple job-shifting or unemployment tags one as a high-risk borrower. Continuous employment, however, hints at financial steadiness.
  • Loan-Asset Measurement. In secured loans like mortgages, if the borrowed amount is high compared to the asset value, risk gets higher for lenders.

One key thing to remember is that different lenders can look at these factors differently. They might use different standards when they’re assigning risk. Also, a borrower might be seen as high risk in one situation but not in another. It depends on the specific loan and how much risk the lender is willing to take.

Can I Get a High-Risk Loan with Bad Credit?

Yes, high-risk loans are an option for those with bad credit. Yet, these loans tend to come with pitfalls and higher risks. Lenders might take a chance on those with low credit scores, but they balance the risk with elevated interest rates and fees.

Lenders could slug you with much higher interest rates if you have bad credit. Meaning, you’ll shell out more cash in the long haul than someone with excellent credit. High-risk loans usually tag along with more costs and penalties. Be sure to thoroughly scrutinize the loan terms to fully grasp all the attached fees.

Certain lenders might need something to secure the loan, especially with bad credit applicants. It implies that if you default on the loan repayment, you might end up losing your collateral like your car or house. If you struggle to pay back a high-risk loan, it could harm your credit score even more. Assessing if you can stick to the repayment terms realistically is critical.

Tip: Before qualifying for high-risk loans, compare all the loan offers. Check the interest rates, additional fees, and repayment terms. Some direct lenders may have lenient eligibility requirements and more flexible deals. Apply conscientiously and negotiate with your loan provider.

Types of High-Risk Loans

High-risk loans come with greater odds of not being paid back. It could be due to the borrower’s past credit, money situation, or the type of security. These loans often bring higher rates to make up for the added risk to the lender. Below are some kinds of high-risk loans:

Payday Loans

Ready by your next paycheck, payday loans are known for swift approval and easy availability with less paperwork. Steep rates and fees can make them pricey. Plus, a short payback time span could trap borrowers in debt if they can’t pay promptly.

Car Title Loans

In car title loans, your car acts as security. Your car’s worth decides the loan. The lender can seize and sell your car to get back the loan if you fail to pay. The danger of car title loans is losing your vehicle. High rates and fees add to the risk. If you fail to repay, you could lose a vital means of transport.

Bad Credit Personal Loans

Bad credit personal loans are for people with low credit scores. The conditions may or may not demand collateral. If a person’s credit isn’t great, they might see higher interest rates. For bank folks, the bigger chances of not being paid back link to the borrower’s past credit mishaps.

Loans with Collateral

These loans need something valuable, like a car or a house, on the line. If the person borrowing can’t pay, the bank takes that valuable thing to make up the loss. Sure, having something valuable makes the bank feel safer. But hard times or bad markets might lower that thing’s worth. If the person can’t pay, they might lose something important.

Discover High-Risk Loans and Choose the Best for You

  • All types of credit score are allowed
  • Prequalification doesn’t affect your credit rating
  • Fast funding in one business day
  • Easy repayment process
get a high-risk loan with bad credit

Alternatives to High-Risk Loans

There are several alternatives to high-risk loans that people can consider. These alternatives are generally designed to offer more favorable terms, lower interest rates, and reduced financial risk. Here are some alternatives:

Conventional LoansCredit Union LoansPeer-to-Peer LoansLoans from Friends or FamilyGovernment SupportEmergency Fund
Interest Rates8% – 18%3% each month6.40 – 35.99%NoneNoneNone
Loan Terms12 – 90 months2 – 48 months6 – 60 monthsVariesNoneNone
Funding TimesSeveral days1 – 3 daysSame day/several daysImmediateVariesImmediate
Credit Score700660NoneNoneNoneNone
Extra FeesFlat fee onlyVaries1% – 10%NoneNoneNone
LocationBanksCredit unionsOnlineNoneFederal FundsYour bank account/cash

Methodology

BadCredify looked at 70 personal loan providers to rank them. These include traditional banks, credit unions, fintech firms, and finance companies. Our deep dive involved studying factors like APRs, loan amounts, terms, fees, customer experience, and others. Our ranking system and star ratings for these lenders came from a weighted evaluation of these factors. Customer feedback helped shape these weights — we came to know what features of a loan and lender matter most. We boiled these down into four key areas:

  1. Loan Costs: This was around 29.25% of our evaluation. It considers the advertised APR, fees, and six other factors.
  2. Loan Terms: Around 22.25% of our evaluation. This category includes the loan amount, repayment term, and other factors.
  3. Borrowing Requirements: This took up about 28.5% of our evaluation. It considers credit score, membership requirements, and six other factors.
  4. Additional Features: Comprises about 20% of our evaluation. It includes an online application, pre-qualification, and eight other aspects.

FAQ

Should I get a high-risk loan?

Many consumers find high-risk loans risky because they can cause continual debt, which can vary based on the loan. But, if you need that money, study the loan details carefully. Ensure it’s within your means. Don’t go for dangerous loans like payday and title ones.

What are the drawbacks of high-risk loans?

High-risk loans come with one big downside, which is higher interest rates. Higher rates cover the increased risk of not getting paid back. It can mean borrowers pay a lot more overall. People with low credit scores or past money problems often get high-risk loans. It means they might not pay their loans back. When this happens, lenders can lose money.

Should I use a high-risk loan to pay off debt?

It’s usually not a good idea to use a risky loan to clear debt. There’s more possibility for money troubles. Risky loans tend to have high-interest rates and tough terms, which can make dealing with your debt a real fight. Risky loans can saddle you with high interest, steep fees, and strict payback plans.