Can I Get a Personal Loan With a 500 Credit Score?

Yes, you can get a personal loan with a 500 credit score, but approval is harder, rates are typically higher and your lender options will be more limited. You may also qualify for a smaller loan amount than a borrower with stronger credit.

Many lenders reserve their best rates for borrowers with higher scores, so you may see annual percentage rates (APRs) toward the higher end of a lender's range. Here are lenders that may consider a 500 credit score, how to improve your approval odds and what alternatives to explore if you’re denied.

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Key Takeaways

• You can get a personal loan with a 500 credit score, but your options are limited. APRs tend to run toward the higher end of a lender's range, and loan amounts are often smaller than what borrowers with stronger credit can access.

• Traditional banks are unlikely to approve a personal loan for someone with a 500 credit score. Instead, focus on lenders that are known for working with borrowers who have lower credit scores.

• A co-signer, collateral or a credit union can lower your rate. Adding a creditworthy co-signer or choosing a secured loan reduces lender risk and may unlock a better offer.

• Prequalify with multiple lenders before you formally apply. A soft credit check lets you compare real APRs and terms without denting your credit score.

Summary generated by AI, verified by MoneyLion editors

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.

What Credit Score Ranges Do Lenders Use?

Lenders typically group credit scores into broad tiers to help set rates and terms. Scores generally fall into five categories:

• Exceptional at 800 and up

• Very good at 740 to 799

• Good from 670 to 739

• Fair from 580 to 669

• Poor from 300 to 579

A 500 credit score falls into the poor range, which is why loan options may be more limited and your APR is likely to land near the top of a lender's range.

Which Lenders May Consider Borrowers With a 500 Credit Score?

If you're wondering which lenders approve personal loans for people with credit scores below 550, start with lenders that publicly work with fair or bad credit rather than traditional banks. Many lenders don't publish an exact minimum credit score, so approval depends on your full financial profile, including your income, employment history and existing debt.

The lenders below may consider borrowers with bad or low credit scores, but having a 500 credit score doesn't guarantee approval.

Will Traditional Banks Approve Personal Loans With a 500 Credit Score?

Getting approved by a traditional bank for a personal loan with a bad or low credit score can be difficult because these banks may have stricter underwriting requirements. Your credit score is only one factor, but missed payments, high debt and limited income can make approval harder.

You may have better luck with online lenders, credit unions or lenders offering secured loans.

Can I Get a Personal Loan With a 500 Credit Score and a Co-Signer?

A co-signer, often a family member or close friend, must have good credit and agree to make the payments if you can't. Before you ask someone to co-sign your personal loan, make sure they understand they're legally responsible for the loan, which can affect their own credit and borrowing power.

What Else Do Lenders Look at Besides Your Credit Score?

Before you apply, take a look at the rest of your credit profile:

• Income and employment: Lenders want to see enough reliable income to handle the new monthly payment.

• Existing debt: Lenders look at your debt-to-income (DTI), which compares your monthly debt payments to your income. A high DTI can make it harder to qualify for a new loan even with steady income.

• Recent payment history: Missed payments, defaults or accounts in collection may affect approval.

• Bank account history: Some lenders may verify your bank account and recent deposits as part of the application.

• Bankruptcy: A recent bankruptcy can limit your lender options.

If improving your credit score is a priority before you borrow again, it may help to learn how a hybrid loan, which blends features of secured and unsecured credit, can support your credit-building goals.

How To Apply for a Personal Loan With a 500 Credit Score

Applying strategically can help you avoid unnecessary hard inquiries and improve your chances of approval. Follow these steps before accepting an offer.

1. Gather your documents: You'll need a copy of your government-issued ID, recent pay stubs and your tax returns.

2. Target lenders that consider a range of credit profiles: Spend a few minutes looking for lenders that work with borrowers who have a credit score lower than 600. Some popular options include Upstart, Upgrade and OneMain Financial.

3. Prequalify with two to three lenders: By using a soft credit check, you can see your potential APR without hurting your credit. This check should only take a few minutes. Before you submit a formal application, it may also help to understand the potential credit impact of a personal loan.

4. Compare the full cost: Make sure you check APRs, loan terms and origination fees. Don't just go with the first lender that approves your application.

5. Submit your application: Provide the requested personal and financial information, which may include linking your bank account or submitting proof of income.

6. Review the agreement: Make sure to review the terms carefully. Look at the funding timeline specifically. This will tell you how quickly you'll get your funds.

7. Choose your repayment term: You should choose the shortest affordable term and set up autopay if that helps you stay on track.

What Are Your Other Options if You Can't Qualify?

If you don't qualify for a traditional personal loan, these options may be easier to access — but they differ in cost, risk and flexibility.

If the amount you need is relatively small, looking at a $500 loan may be more realistic than aiming for a larger offer.

Final Thoughts

• A 500 credit score doesn't prevent you from getting a personal loan, but it limits your choices.

• Compare several lenders through prequalification before applying.

• If you're uncomfortable with a personal loan, safer alternatives exist like a secured loan or a credit card.

FAQs

Can I get approved for a personal loan with a 500 credit score and no co-signer?

Yes, it's possible, but approval will depend on the lender's requirements, your income and your overall financial profile. Having a co-signer or collateral may improve your chances.

Will applying for a personal loan hurt my credit score?

Prequalifying with a soft credit check won't affect your credit score. However, submitting a formal application usually results in a hard inquiry that may temporarily lower your score by a few points.

How much can I borrow with a 500 credit score?

Loan amounts vary by lender, but borrowers with a 500 credit score often qualify for smaller loan amounts than those with stronger credit. Your income, existing debt and repayment ability also affect how much you can borrow.

What APR can I expect with a 500 credit score?

Borrowers with a 500 credit score may receive APRs near the higher end of a lender’s range, often around 20% to 36%. Your actual rate will also depend on your income, debt, loan amount, repayment term and whether the loan is secured.

Are secured loans easier to get with a 500 credit score?

A secured loan may be easier to qualify for because collateral reduces the lender’s risk. However, the lender can take the pledged asset if you fail to repay the loan, so only use collateral you can afford to lose.

Can I get guaranteed approval for a personal loan with a 500 credit score?

No legitimate lender can guarantee you'll be approved for a personal loan based on your credit score alone. Lenders will review other factors such as your income, existing debt and ability to repay before making a decision. Be cautious of lenders that advertise "guaranteed approval," especially if they ask for upfront payment before providing the loan.

What is considered a fair credit score?

A fair credit score generally falls between 580 and 669 based on common scoring categories. Scores below that range are considered poor, while scores of 670 and up are considered good or better.

Can I get approved for a car loan with a 500 credit score?

Yes, but you'll likely face higher interest rates and may need a larger down payment or co-signer. Many subprime auto lenders work with lower credit scores, though approval also depends on your income, debt and the vehicle you want to finance. Prequalifying with multiple lenders can help you compare offers before you commit.

Is instant approval available for a personal loan?

Some online lenders offer fast prequalification and same-day decisions, but no lender can guarantee instant approval. Your approval still depends on your credit profile, income and other factors the lender reviews. Be cautious of any lender that promises guaranteed instant approval before checking your information, since that's a common sign of predatory lending.

Can I get a $500 loan with bad credit?

Yes, small-dollar loans around $500 are often easier to qualify for than larger personal loans, especially through credit unions or lenders that specialize in bad credit. These loans often carry short repayment terms and may skip a hard credit check, but rates can still run high, so compare the total cost before you borrow.

What is a good DTI ratio for a personal loan?

Generally, a lower DTI ratio signals less risk to lenders, since more of your income is available to cover a new payment. Lenders typically prefer your total debt payments to make up a modest share of your monthly income, though exact thresholds vary by lender. Paying down existing balances before you apply can help lower your DTI.

Key Terms

• APR: The yearly cost of borrowing, including interest and certain fees, which lets you compare loan offers more accurately than the interest rate alone.

• Credit score: A number based on your credit history, ranging from 300 to 850, that helps lenders gauge how likely you are to repay on time.

• Soft credit check: A credit review that doesn't affect your score, commonly used when you prequalify to preview your potential rate.

• Hard inquiry: A credit check triggered by a formal application that can temporarily lower your score by a few points.

• Secured loan: A loan backed by collateral such as a car or savings, which lowers lender risk and may come with a lower rate. Missing payments can mean losing the asset.

• Co-signer: Someone with stronger credit who agrees to repay your loan if you can't, which can improve your approval odds. They're fully responsible for the debt.

• Payday loan: A short-term, high-cost loan, usually for $500 or less, due on your next payday, with APRs that often approach 400%.

Summary generated by AI, verified by MoneyLion editors

Sources

• Consumer Financial Protection Bureau. 2024. "What is the difference between a loan interest rate and the APR?"

• Consumer Financial Protection Bureau. 2023. "What is a credit score?"

• Consumer Financial Protection Bureau. "Differentiating between secured and unsecured loans."

• Consumer Financial Protection Bureau. 2024. "What is a payday loan?"

Cynthia Measom contributed to the reporting for this article.

Photo Credit: shapecharge / iStock/Getty Images

Data is accurate as of Oct. 13, 2026, and is subject to change.

Parts of this article were created with AI assistance. MoneyLion editors reviewed, fact-checked and edited the final version and are responsible for its accuracy.