What Types of Loans Can I Get if I Have Bad Credit?

Last Update: May 23, 2020 Loans

You might think that since you have bad credit, you won’t be able to get a loan. But this is not really the truth, you may be somewhat limited on what types of loans are available to you but there are still some loans out there. You may be able to get a conventional loan, personal, auto or even a home loan with bad credit. The terms may be a little harder to deal with, but many of them are still possible. You can also get payday loans, auto title loans, or no credit check loans. These do have lots of pros and cons and with any loan you should always weigh all your options. It does literally pay to be smart and thoughtful about the loans you endeavor to apply for, and there are even a few that should probably be avoided altogether.

Can I Get a Personal Loan with Bad Credit?

A personal loan is available through many sources including banks, online lenders and credit unions. These types of loans can be obtained and used for any purpose. However, the actual amount the lender may approve you for may vary a lot based on your actual credit report and whether you have collateral enough to provide security for the loan. Credit unions can sometimes be a better option since they tend to be more flexible with their criteria for granting loans. You have a couple of valid options for getting personal loans including:

  • Secured loan

If you have super bad credit, you may want to look at a secured loan. This will make it a little easier to qualify for and usually you can get better terms. You do want to make sure you can make the payments on this type of loan or you could lose your collateral – your savings account, car or home will be gone if you use them for collateral and then fail to pay.

  • Get a cosigner

You may have the chance to get a co-signer who has a better credit score to sign for you a loan. The lender will base their loan terms on the co-signer’s credit instead of yours. Of course, because of the large risk involved a lot of people will not co-sign for others. If you think you might default on the loan, then don’t even ask a friend or a family member to co-sign and put their finances and credit score at risk.

Can I Get a Mortgage with Bad Credit?

Your choices are going to be somewhat limited, but it is possible to get a mortgage even if you have bad credit. Many experts suggest working closely with a mortgage broker so you have a better variety of options available to you. You may be able to qualify for an adjustable rate mortgage even though they are risky themselves because they are always changing; and so is your payment. You might look at some of the government programs like the FHA for help obtaining a mortgage. They usually need less for a down payment and they are easier to get.

Can I Get a Car Loan with Bad Credit?

Bad credit car loans are designed for buyers who have poor credit reports. You may pay a lot more in interest and you’ll have to work within some limited available finances than if you had good credit, but they are out there. There are some very reputable lenders who actually focus on offering car loans to people who struggle with their credit history. And there are also some who take advantage of people in a tough financial situation. To protect yourself, you should not pay ridiculously high interest rates (like in the double digits) or sign a loan for longer than a five-year period of time.

Can I Get a Payday Loan with Bad Credit?

Payday loans are usually the way people with bad credit go when they need some fast cash to catch up bills or in an emergency. They can be tricky – so you’ll want to handle them wisely; but they are out there for you to use should you need them. Usually, these loans are for relatively small amounts like $500 or so; and the terms of the loan are short – usually until your next payday when you agree to pay the loan of in its entirety. These loans also have very high interest rates, but they are easy to qualify for if you have a regular job and income.

Can I Get an Auto Title Loan with Bad Credit?

This is not the same type of loan as an automobile loan. An auto title loan means you use your car as collateral just to get the loan. You can usually only get amounts worth less than your car and you don’t need a credit check to qualify. These are short term loans and usually have very high interest rate too. A lot of people get themselves in a bind with this type of loan and end up renewing it several times. That’s okay as long as you keep paying – but it can get expensive. Some states have made auto title loans illegal, so be sure you know what is and is not allowed in your state.


The answer to the question about what kinds of loans you can get with bad credit is – a lot of different types of loans. What this means is that you are not stuck just because you missed a few payments and messed up your credit score; or maybe you lost your job and you’re trying to just get your head back above water financially. There are some loans that you can still qualify for. The best thing to do is to look at the terms and interest rates for each of the different types of loans and then choose which one will work the best for you in your particular situation. For instance, if you do not own a car outright, then you can eliminate the auto title loan. If you have no collateral or co-signer you may not want to consider the personal loan. Find the loan that is going to be most beneficial for you – where you are – and then pursue it.



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