Best Hardship Loans for Bad Credit

If you're looking for a personal loan to help you through a financial hardship, there are several lenders that you can choose from.

Many companies offer a variety of loans designed to help with short-term or long-term financial difficulties. Here is a breakdown of five of the best hardship loans for bad credit:

MoneyLion offers a service to help you find personal loan offers. Based on the information you provide, you can get matched with offers for up to $100,000 from our top providers. You can compare rates, terms, and fees from different lenders and choose the best offer for you.

1. Avant

Best for: Quick funding

With Avant, you can get a personal loan ranging from $2,000 to $35,000 depending on your needs. This can cover areas such as medical bills, home repairs or emergency funds for unexpected expenses. It advertises the following benefits:

• Fixed interest rates

• Fast funding as soon as the next business day

• Set monthly payments

• Around-the-clock customer service

• Automated payments

2. LendingPoint

Best for: Fast and easy approval process

Personal loans in the shape of hardship loans from LendingPoint can range from $1,000 to $36,500. It prides itself on proprietary smart technology that supplies you with tools to better paint your potential financial picture. Here are some takeaways:

• Simple application with no impact on your credit score

• Easily explore your payment options

• Ability to choose monthly payments and loan terms best suited for you

• Quick funding potentially as soon as the next business day

3. OneMain Financial

Best for: In-person assistance

OneMain Financial offers loans that range from $1,500-$20,000. You can see if you prequalify for a loan with OneMain Financial which is a good route to take when trying to avoid hard credit checks. It has online options but also about 1,400 physical branches nationwide so there is potential to do in-person banking. Here are some points to consider for OneMain Financial:

• Personalized service and loan specialists

• Fixed rates on loans

• Fixed payments on loans

• No repayment fees

4. Upgrade

Best for: Large loan amounts

If you are looking to get a larger personal loan, Upgrade may be worth considering as it offers loans up to $50,000. It also gives you options for refinancing credit cards or debt consolidation, both of which can help with improving your credit. Here are some other key takeaways from Upgrade:

• Low fixed rates on home equity loans

• No prepayment penalties or fees

• Can help you plan for a major unexpected expense

• Affordable monthly payments

5. Upstart

Best for: Those looking to rebuild their credit score

Not only can you get a loan with Upstart, but it is one of the few lenders who specifically cater to those with bad credit. Upstart looks at more than just your credit score and knows it can help you improve your credit history with a few months of good payment habits. Unsecured loans, which means they are not backed by collateral, can be trickier to get with poor credit, however, Upstart offers the following:

• Flexible loan amounts ranging from $1,000 to $50,000

• Fixed interest rates

• No prepayment fees

How to Find the Best Loan

Before securing a personal loan, be sure to do your research. Make sure you understand the difference between what each lenders offer. Areas to pay close attention to would be funding time, loan payments, rates and fees. Here are some tips and key takeaways to assess which loans will work best for you:

• Eligibility requirements: Compare and review minimum credit requirements from lenders you are considering. This way you will know which lender can work with your current bad credit.

• Fees and penalties: The lender might charge an origination fee, late fees or even prepayment penalties. It is good to know what you are signing up for and what you'll have to pay on top of the principal loan amount.

• APRs: An annual percentage rate indicates the total cost of a loan for you annually. Try to find the best interest rate being offered to make the loan both more attainable and affordable.

• Prequalify: If you have the option to prequalify for a loan, make sure you take advantage. This can help avoid a hard credit check, which can impact your already questionable credit score. It can also give you an indicator as to whether or not you are likely eligible for the loan.

Raising Your Credit Score

It can be more difficult to get a personal loan with bad credit. Lenders that are willing to lend to people with low credit scores are more likely to charge high interest rates and give other unfavorable terms.

Working on raising your credit score can make it easier for you to get financing in the future. If your credit score is high because you have a history of missed payments (35% of your score), set reminders and make sure you make every payment on time. In a few months to a year, you should start to see a difference in your score.

If you have a large amount of debt already, that can also negatively impact your credit score. Credit utilization makes up 30% of your score. Not taking out anymore debt and paying down the money you owe will also help you raise your score. Tools like debt consolidation can help make this easier.

FAQs

How do I claim hardship on a loan?

Contact your lender to see if they have a hardship program that you qualify for. Try to workout a new payment plan before you miss payments.

What can you do when you need money urgently?

If you need money urgently, you can take out a personal loan, find a side gig or sell items you might have. Some ideas to consider are:

• Have a garage sale

• Walk dogs

• Clean houses

What is a hardship loan?

A hardship loan isn't a banking term, it's a category of loans describing the need for borrowing money in a financial emergency. It is a loan that helps you get through unforeseen or difficult financial hardship circumstances. For example, you may apply for a hardship loan for the following reasons:

• Home repair

• Medical bills

• Unemployment

• Caregiving responsibilities

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