7 of the Best Personal Loans for Fair Credit For July 2021

Personal Loans For Fair Credit: Fair credit, as defined by FICO, is a credit score between 580 and 669. Although many personal loans require scores higher than this range, the lenders in this list are suited for those with fair credit.

You’ll typically need good to excellent credit to qualify for a personal loan. If you have fair credit — usually considered to be a credit score between 640 and 699 — you might have a harder time getting approved. However, there are several lenders that offer personal loans for fair credit.

personal loans for fair credit

While you’ll be able to score a loan with a score below 670, you shouldn’t expect the most favorable terms. High loan limits and low-interest rates are typically reserved for those with the highest credit scores.

But don’t get discouraged. Lenders are still willing to extend financing to you, even if you do have a score between 580 and 669. Here are the six best personal loans for fair credit.

Best 7 Personal Loans for Fair Credit of July 2021

1. Upstart

Online lending platform Upstart earned Investopedia’s “best overall” spot for several reasons. First, it offers maximum borrowing flexibility: personal loans of up to $50,000 that you can use for just about anything. Second, its minimum credit score requirement starts at 580, which is in the middle of the fair credit category.

To Upstart, you are more than your credit score (as its motto proclaims). In addition to your credit report/history, Upstart’s AI-powered underwriting process also considers additional factors, such as your education, area of study, and job history. This alternative data can be a boon to borrowers with only fair credit, helping them qualify for a lower interest rate than they might otherwise.

Pros

  • There’s no prepayment penalty if you want to pay your loan off early.
  • A soft credit inquiry can help you check your rate before you officially apply (without dinging your score).
  • Your employment and education history are considered in setting terms.

Cons

  • The maximum APR is high at 35.99%.
  • It has potentially high origination fees—up to 8%.
  • Only two loan lengths are offered.
  • Low maximum loan amount of $50,000

2. Avant

Avant could be a good choice for borrowers with poor or fair credit. You can borrow $2,000 to $35,000* with repayment terms from two to five years.

Pros

  • Accepts poor credit scores
  • Funding as soon as the next business day (if approved by 4:30 p.m. CT on a weekday)
  • No prepayment penalty

Cons

  • Not available in Colorado, Iowa, Hawaii, Vermont, Nevada, New York, or West Virginia
  • Administration fee up to 4.75%
  • Charges late and dishonored payment fees

3. Best Egg

With Best Egg, you can borrow $5,000 to $50,000 with repayment terms from two to five years. If you’re approved, you could have your funds within one to three business days after successful verification — which could make it a good option if you need cash quickly.

Pros

  • Might be able to borrow up to $50,000
  • Accepts poor credit scores
  • Fast loan funding

Cons

  • Not available in Iowa; Vermont; Washington, D.C.; or West Virginia.
  • 0.99% to 5.99% origination fee
  • Charges late fees

4. Upgrade

Loan amounts, which start at just $1,000, are flexible but cap out at $35,000—lower than lenders that focus on more creditworthy borrowers. Three- and five-year loan terms are available. Upgrade charges an origination fee between 2.9% and 8% of the loan, and borrowers will encounter a $10 fee if their payment is more than 15 days late or if the payment does not go through; there are no discounts for autopay.

Pros

  • Low minimum credit score requirement
  • Borrowers can use loans to cover business expenses
  • Offers direct lender payoff for debt consolidation loans

Cons

  • High APR range
  • Charges fees for origination, late payment, and insufficient funds
  • Only offers two loan repayment periods

5. LightStream

LightStream is a consumer lending division of Trust—which formed following the merger of SunTrust Bank and BB&T. The platform offers unsecured personal loans from as little as $5,000 up to $100,000. Although a number of lenders offer smaller loans than the LightStream minimum, few lenders offer a higher maximum loan. 

Pros

  • No origination, prepayment, or late fees
  • Low, competitive rates
  • Fast approval and funding

Cons

  • No prequalification process
  • No due date flexibility
  • Limitations on use of loan proceeds

6. Discover

If you’re looking for a longer repayment term, Discover could be a good choice — you can borrow $2,500 to $33,000 and can pick a term from three to seven years. Just keep in mind that opting for a longer term means you’ll pay more in interest over time.

Pros

  • Repayment terms up to 7 years
  • Funding as soon as the next business day after acceptance
  • If you decide you don’t want the loan, you can return the funds within 30 days and won’t be charged interest

Cons

  • The minimum credit score is in the upper range of fair credit
  • Charges late fees
  • Can’t add a cosigner to the loan
personal loans for fair credit

7. LendingPoint

LendingPoint specializes in working with borrowers who have near-prime credit — typically meaning a credit score in the upper 500s or 600s. You can borrow $2,000 to $36,500 with repayment terms of two to five years.

Pros

  • Accepts poor credit scores
  • Funding as soon as the next business day
  • Very competitive rates for borrowers with poor or fair credit

Cons

  • Can only borrow up to $25,000
  • Origination fees from 0% to 6%
  • Not available in Nevada or West Virginia

What Is the Best Interest Rate on a Personal Loan?

When you shop around for the best personal loan interest rate, you can save. Compare your personal loan offers with national average trends for personal loans to know if you’ve found a good deal. The average personal loan rate is 9.34%. Last week’s average rate was 9.93%.*

Rated as of May. 21, 2021.

Can You Get a Personal Loan With Fair Credit?

Fair credit can be a barrier to approval with some personal loan companies, but not all. Lenders may rely heavily on your credit score to determine whether you’ll be approved for a loan and the terms they’re willing to offer, though that’s not the only thing lenders consider.

A fair credit score is considered below-average credit and falls between 580 and 669 on the FICO scale. It’s a step up from bad credit.

You can get a loan with a 600 or 650 credit score, though it depends on the lender. One lender might set the bar at 620, while another might require a score of 680 for loan approval.

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The Bottom Line

When you have fair credit, your borrowing choices are limited. You may be tempted to go with the first lender that will qualify you when you need a personal loan. However, the truth is that you have options. You might not qualify for the lowest rate and best terms available, but that doesn’t mean you should settle.

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