Having bad credit can make it difficult to get approved for loans from traditional lenders like banks or credit unions. Many people with low credit scores turn to online lenders for bad credit signature loans when they need access to funds. In this comprehensive guide, I’ll explain what signature loans are, the pros and cons of getting one online with bad credit, provide tips for finding the best loan offer, and share my top picks for reputable online lenders that work with bad credit borrowers.
What Are Signature Loans?
A signature loan, also known as a good faith loan, is a type of unsecured personal loan that only requires a borrower’s signature on the loan documents rather than collateral. It’s called a “good faith” loan because the lender is trusting that you will repay the loan in good faith based on your signature and promise to pay it back.
Since signature loans don’t require collateral like a house, car, or other assets, they are considered higher risk for lenders That’s why borrowers with poor credit usually need to turn to alternative online lenders to qualify for these loans rather than banks
Signature loans allow you to borrow a lump sum of money upfront and repay it over a set repayment term in fixed monthly payments Loan amounts typically range from $1,000 to $35,000 and terms are usually between 12-60 months.
Pros of Getting a Signature Loan Online With Bad Credit
Here are some of the biggest benefits of getting a signature loan online if you have bad credit:
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Fast funding: Online lenders can deposit funds directly into your bank account as soon as the next business day after approval.
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Fixed payments: Signature loan payments are fixed over the loan term so they are predictable and manageable.
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Simple application: Applying is quick and easy online without needing to visit a bank branch.
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Flexible use of funds Money can be used for any purpose since signature loans are not tied to a specific purchase.
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May improve credit: Making on-time payments can help rebuild your credit history over time.
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Lower qualification requirements: Online lenders have more lenient credit requirements than traditional banks.
Cons to Consider
While signature loans for bad credit can be helpful, there are some downsides to weigh as well:
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High interest rates: Poor credit means you will pay a much higher interest rate, often above 15-30%.
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Origination fees: Many lenders charge 1-8% of the loan amount in upfront fees.
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Prepayment penalties: Some lenders charge a penalty fee if you pay off the loan early.
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Missed payment fees: Late fees are common if you miss a payment due date.
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Credit check required: Applying requires a hard credit inquiry which can temporarily lower your credit score.
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Debt can spiral: Only borrow what you can realistically budget to repay or high interest debt can snowball.
Tips for Finding the Best Bad Credit Signature Loan
If you have decided a signature loan is your best option for accessing emergency funds or consolidating high interest debt, here are some tips for getting the best loan offer:
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Shop around and compare offers from multiple online lenders. Rates, fees, terms, and requirements can vary significantly.
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Opt for lenders offering APRs below 25% and origination fees under 5% if possible.
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Avoid lenders requiring full payoff if you pay the loan early.
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Calculate the total cost of the loan including interest and fees. Low rates upfront can sometimes end up costing more overall.
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Read all fine print carefully and make sure you understand the exact loan terms before accepting.
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Check lender reviews and complaints with the BBB and Consumer Financial Protection Bureau.
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Consider using a co-signer with better credit to potentially qualify for a lower rate.
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Only borrow what you can comfortably afford to repay to avoid missed payments and further credit damage.
My Top Picks for Bad Credit Signature Loans Online
Based on intensive research comparing over 25 top online lenders, here are my top recommendations for getting a signature loan online with bad credit:
Best Overall: Upgrade
- Loan amounts from $1,000 – $50,000
- Terms of 2 – 7 years
- Fixed APRs from 5.94% – 35.97%
- Soft credit check for pre-qualification
Upgrade offers high approval odds even with poor credit and charges lower rates than many competitors. I really like their clear and upfront pricing with no hidden fees. They also provide helpful credit health tools.
For Fast Funding: CashUSA
- Borrow up to $10,000
- Terms up to 72 months
- APRs 5.99% – 35.99%
- Funds as soon as 1 business day after approval
CashUSA makes it easy to get approved for smaller loans quickly. They have a fast, streamlined application process and you can get funds deposited super fast.
For Flexible Terms: Payoff
- $5,000 – $40,000 loan amounts
- Choose your exact loan length from 2-5 years
- Fixed rates from 5.94% – 29.99% APR
- 97% customer satisfaction rating
I like Payoff for their flexible loan terms and excellent customer service. You can customize your term length to get the monthly payment you can afford.
For Rebuilding Credit: Avant
- Borrow up to $35,000
- Terms from 24-60 months
- APRs 9.95% – 35.99%
- Reports payments to all 3 credit bureaus
Avant specializes in loans for bad credit borrowers looking to rebuild their score. They have flexible minimum score requirements and offer credit monitoring tools.
For Low Rates: LendingPoint
- $2,000 – $36,500 loan amounts
- 24 – 60 month terms
- APRs as low as 6.99% with autopay discount
- Rate beat program to match competitor offers
LendingPoint offers highly competitive rates compared to other bad credit lenders. I recommend them if your priority is getting the lowest APR possible.
The Bottom Line
While a bad credit signature loan likely means accepting higher interest rates and fees, it can be one of the only options to access funds quickly if you have damaged credit. Just make sure to shop around, read the fine print carefully, and only borrow what you can realistically payback on the repayment schedule. Used responsibly, these online loans can help bridge short-term cash needs and potentially help rebuild your credit over time as you make on-time payments each month.
How do I access the funds?
Easily manage your loan activity with Online Banking and the Elements Mobile App. You can access funds in as little as one business day after your loan is finalized. The funds will be available in the Elements account of your choice or sent via check if you prefer.
Does Elements Financial offer debt consolidation loans?
We do offer consolidation loans to consolidate bills and pay off other debts. An Unsecured Signature Loan (see information on this page) can be used for that purpose. Other options available to most members include other Personal Loans, Home Equity Loans, or even a first mortgage refinance with a debt consolidation option.
3 BANKS NO CREDIT CHECK Personal Loans Bad Credit LOANS TOP 3 Lenders 15 Second APPLICATION
FAQ
Do they check credit for signature loan?
Who will give me a loan if no one else will?
Who will lend me money no matter what?
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Lender
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Minimum Annual Income Required
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Loan Amounts
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Universal Credit
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No verification
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$1,000–$50,000
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Best Egg
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No verification
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$2,000–$50,000
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Upstart
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$12,000
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$1,000–$50,000
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Avant
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2.5x the amount borrowed
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$2,000–$35,000
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What is a good credit score for a signature loan?
Where can I get a signature loan?
You can get a signature loan from an online lender, bank or credit union. These loans may be called unsecured personal loans, but they’re the same thing. Online lenders: Online lenders offer unsecured personal loans ranging from $1,000 to $100,000 for borrowers with bad to excellent credit.
What are E-sign loans for bad credit borrowers?
E-sign loans for bad credit borrowers are specially designed lending solutions for individuals with blemished credit that are seeking a completely online lending application process. E-sign loans, for borrowers of any credit status, are unsecured personal loans that operate on an installment structure.
How do I get a signature loan from a bank?
To get a signature loan from a bank, you’ll likely need a good credit score and a positive credit history. You may also need to be a current customer of the bank. Credit unions: Because their APRs are capped at 18%, credit union personal loans tend to be affordable. Like banks, however, you’ll likely need solid credit to qualify.
What are signature loans with no credit check?
Signature loans with no credit check are unsecured loans with easy requirements. Signature loans that do not require a credit check are usually “payday loans” that tend to have high fees and interest rates. Due to the added risk lenders take on with no credit check loans, these loans tend to come in smaller amounts with fewer repayment options.
What is the best signature loan?
The best signature loan is LightStream’s offer of $5,000 – $100,000 in funding, with an APR of 7.49% – 25.99%, a repayment period of up to 144 months and no origination fee. LightStream also provides fast decisions, sometimes approving people the same day they apply. In general, the best signature loans have low APRs and no origination fees.
Can you get a signature loan with bad credit?
Because signature loans rely heavily on your credit score, it will likely be difficult to qualify for a loan with a bad credit score. While there are signature loans for bad credit, if you do qualify, you’ll likely get matched with APRs as high as 36%. Bad credit signature loans aren’t your only option, however.