A personal loan can help you take control of high-interest debts or fund a major purchase. Most of them have fixed monthly payments, which make it easier to budget for your monthly payments. And there’s no need to pledge collateral to get approved, which might be a requirement with some other types of loans.
If you have fair credit, which FICO defines as a score between 580 and 669, borrowing isn't as easy as it would be with excellent credit. But a variety of lenders can help you get a personal loan with reasonable terms.
For the list below, we've chosen lenders likely to provide the funding you need at a reasonable price and with fixed interest rates. These lenders either say they don't have a hard minimum credit score, or they're willing to lend to people in the "fair" range. What’s more, these lenders should be easy to work with because your time is valuable. The process doesn’t need to be painful.
Best Personal Loans for Fair Credit of October 2020
|Lender||Best For||Fixed APR||Minimum Loan Amount||Maximum Loan Amount||Terms||Recommended Credit Score|
|Prosper||Best for a Long Track Record Online||7.95%-35.99%||$2,000||$40,000||36 or 60 months||640+|
|Upstart||Best for High Earners||7.98%-35.99%||$1,000||$50,000||36 or 60 months||600+|
|LendingClub||Best for Improving Credit Score||10.68%-35.89%||$1,000||$40,000||36 or 60 months||580+|
|SoFi||Best for Higher Credit Scores||5.99%-18.53% with autopay||$5,000||$100,000||24-84 months||670+|
|Marcus by Goldman Sachs||Best for No Fees||6.99%-19.99% with autopay||$3,500||$40,000||36-72 months||660+|
|First Tech Federal Credit Union||Best for Small Loans||7.70% to 18%||$500||$50,000||2 to 7 years||580+|
If you value customer service and are looking for personal attention from your lender, consider getting a loan from your local bank or credit union. They tend to be community-focused.
Prosper: Best for a Long Track Record Online
Prosper was a pioneer in online lending and claims its place as the first peer-to-peer (P2P) lender in the U.S., making it a long-standing name among online lending companies. Prosper keeps it simple with a three-year repayment term or a five-year option, and you can pay off your loan early at no additional charge. Rates range from 7.95%-35.99% APR. However, with fair credit, expect rates near the middle or high end of that range—the lowest rates are only available to borrowers with excellent credit.
Fixed rates make it easy to budget while you pay off debt
Three- and five-year terms keep payments manageable without piling up interest costs
No prepayment penalty
Easy to check your rate before borrowing
Depending on creditworthiness, high rates can make borrowing expensive
Origination fees require borrowers to take out extra to fund major purchases
Prosper Personal Loan Details
|Loan Terms||36 or 60 months|
|Fees||Late fee of $15 or 5%, origination fee between 2.41%-5%|
|Time to Receive Funds||As little as 1 to 5 business days|
|Recommended Credit Score||640+|
Read the full review: Prosper Personal Loans
Upstart: Best for High Earners
Upstart, launched in 2012 by former Google executives, takes a unique approach in evaluating personal loan applications. In addition to reviewing your credit history and income, Upstart takes your education and work history into account when approving loans. APRs range from 7.98% to 35.99%. Upstart may charge a one-time origination fee, as well.
Your degree or work history can help you get approved with fair credit
Three- and five-year repayment terms
Next-day funding available
Fixed interest rates
Origination fees as high as 8%
Potential for high rates, depending on your application
Upstart Personal Loan Details
|Loan Amounts||$1,000-$50,000, based on credit, income, and other information considered in your loan application.|
|Loan Terms||36 months or 60 months|
|Fees||Late fee of $15 or 5%, origination fee between 0%-8%|
|Time to Receive Funds||At least 1 business day after accepting the loan terms, 2 if you accept after 5pm EST|
|Recommended Credit Score||600+|
Read the full review: Upstart Personal Loans
Notes: Your loan amount will be determined based on your credit, income, and certain other information provided in your loan application. Not all applicants will qualify for the full amount. Loans are not available in West Virginia or Iowa. The minimum loan amount in MA is $7,000. The minimum loan amount in Ohio is $6,000. The minimum loan amount in NM is $5100. The minimum loan amount in GA is $3,100.
If you accept your loan by 5pm EST (not including weekends or holidays), you will receive your funds the next business day. Loans used to fund education related expenses are subject to a 3 business day wait period between loan acceptance and funding in accordance with federal law.
The full range of available rates varies by state. The average 3-year loan offered across all lenders using the Upstart platform will have an APR of 25.16% and 36 monthly payments of $37 per $1,000 borrowed. There is no down payment and no prepayment penalty. Average APR is calculated based on 3-year rates offered in the last 1 month. Your APR will be determined based on your credit, income, and certain other information provided in your loan application. Not all applicants will be approved.
When you check your rate, we check your credit report. This initial (soft) inquiry will not affect your credit score. If you accept your rate and proceed with your application, we do another (hard) credit inquiry that will impact your credit score. If you take out a loan, repayment information will be reported to the credit bureaus.
LendingClub: Best for Improving Credit Scores
LendingClub is a marketplace lender offering P2P loans as well as funding from institutional investors. According to a LendingClub representative, you can qualify with a credit score as low as 580. Other factors, like your income and debt payments, affect whether or not you’ll get approved. Rates range from 10.68%-35.89% APR, and you pay an origination fee of 2% to 6% when you receive funds.
Personalized rate quotes are quick and easy to get
Fixed interest rates keep loan payments stable
Loan amounts as little as $1,000 available
No prepayment fees, so you can repay early
Potentially expensive borrowing source if you pay the highest rates
It can take seven days to receive funds after you apply
LendingClub Personal Loan Details
|Loan Terms||36 or 60 months|
|Fees||Late fee of $15 or 5%, origination fee between 2%-6%|
|Time to Receive Funds||At least 4 business days|
|Recommended Credit Score||580+|
Read the full review: Lending Club Personal Loans
SoFi: Best for Higher Credit Scores
SoFi has relatively low rates and no origination fee. But it requires a credit score of at least 680, making it harder for those with fair credit to obtain a personal loan. That said, if your credit score is high enough, factors like your work history and your income can help you secure the low rates SoFi offers. Fixed APRs range from 5.99% to 18.53% (with autopay).
No late payment fees, though late payments can damage your credit
No origination fee
Minimum loan amount of $5,000 might be more than you need
You might not qualify with fair credit
SoFi Personal Loan Details
|Fixed APR||5.99%-18.53% with autopay|
|Loan Terms||24-84 months|
|Fees||No late fees or origination fees|
|Time to Receive Funds||Typically within a week|
|Recommended Credit Score||670+|
Read the full review: SoFi Personal Loans
Marcus by Goldman Sachs: Best for No Fees
Marcus by Goldman Sachs evaluates your credit history alongside other financial details like your income and housing expenses to determine your creditworthiness. According to a Marcus representative, you can qualify with a FICO score as low as 660 (or lower, in some cases). Rates range from 6.99% to 19.99% APR. While the lender's rates are higher than others on this list, Marcus stands apart because it charges no fees: origination, late, prepayment or otherwise.
No origination fee
No late fees, though paying late can increase costs and damage your credit
You can skip a payment if you make 12 consecutive on-time payments
Minimum loan amount of $3,500 could exceed your needs
Marcus by Goldman Sachs Personal Loan Details
|Fixed APR||6.99%-19.99% with autopay|
|Loan Terms||36-72 months|
|Fees||No late fees or origination fees|
|Time to Receive Funds||As little as 1 to 4 business days|
|Recommended Credit Score||660+|
Read the full review: Marcus Personal Loans
First Tech Federal Credit Union: Best for Small Loans
At First Tech Federal Credit Union, you can borrow as little as $500, and the credit union is willing to work with borrowers who have bad credit. There are no origination fees, and rates are reasonable. Plus, if you have trouble getting approved, you can use a co-signer to help strengthen your application.
First Tech FCU does a "hard" credit pull, which can hurt your credit. If you have any doubts before you apply, ask a representative if you have a good chance of getting approved.
To borrow with First Tech FCU, you'll need to become a member. That's easy for anybody nationwide. You can become eligible by joining the Computer History Museum or the Financial Fitness Association during the application process.
$500 minimum loan size
Relatively low rates
Hard credit inquiry could hurt your credit
|Loan Amounts||$500 to $50,000|
|Fixed APR||7.70% to 18.00%|
|Loan Terms||2 to 7 years|
|Loan Fees||No origination fee, no prepayment penalty|
|Membership Fee||$8 to $15, if you need to join an organization|
|Time to Receive Funds||Potentially next-day funding|
|Recommended Credit Score||580+|
Read the full review: First Tech Federal Credit Union Personal Loans
Local Banks and Credit Unions: Best for Personal Attention
When you’re applying for a personal loan, it’s wise to include a local financial institution in your search. Particularly with fair credit, you might benefit from having a human rather than an automated system review your finances.
For example, you might be able to explain temporarily-high credit card balances that were a result of unexpected medical bills. Plus, if a bank employee can see your checking and savings accounts—which shows healthy financial behavior—they may be more likely to make exceptions.
Credit unions, as community-focused, not-for-profit organizations, might be particularly willing to approve your application.
Potential same-day funding
A loan officer at the financial institution might review your credit history
If you have accounts at your local bank, they have visibility into your finances, which could help you get approved
Support for organizations in your area
An in-person visit may be inconvenient
The application process may be cumbersome and require substantial manual input
May require credit union membership
How Do You Know What Credit Score Range You're In?
The term “fair credit” refers to your FICO score. Recent versions of FICO scores ranges from 300 to 850 points. Here's how the scores are categorized:
- Excellent credit: 750-850
- Good credit: 700-749
- Fair credit: 650 to 699
- Poor credit: 300-649
If you have a FICO score below 650, check out our list of best personal loans for bad credit.
As of Aug. 4, the average interest rate advertised by lenders that offer personal loans for fair credit is 16.23% across the more than two dozen lenders we track.
Will Shopping for a Loan Hurt My Credit Score?
You should shop around and compare personal loan terms before you decide on one. But getting quotes can ding your credit score if the lender performs a "hard pull" on your credit record to see if you qualify. That's why you should stick to lenders who do a “soft pull” or “soft inquiry” of your credit report or those who say that checking offers won’t hurt your credit score.
Also, target loans like those on this list that indicate they may be available to people with fair credit. That way you won't waste your time or a credit pull on a product that isn't suited to you.
How Can I Improve My Chances of Getting a Loan?
There are several steps you can take to improve your chances of getting a loan:
- Check your credit report: You can get a free copy of your credit report from each of the three main credit bureaus (Experian, Equifax, and TransUnion) every year at AnnualCreditReport.com. Look over your credit reports to make sure there aren't any errors that could be hurting your credit score.
- Pay down your debt: If you have a high debt-to-income ratio when you apply for a loan, it could hurt your chances of getting approved. DTI compares your monthly gross income to your monthly debt payments. Paying down debt can lower your DTI and make you a less risky customer for lenders.
- Consider getting a co-signer: A co-signer, or co-borrower, is someone who signs the loan agreement with you and is responsible for payments if you default on the loan. If they have a better credit score or more income, a lender may feel more comfortable giving you the loan.
How Should I Choose a Fair Credit Lender?
When looking for a lender, you won't have as many choices as if you had excellent credit. But it's still important to find the best lender you can for your circumstances. Pay attention to these factors:
- Interest rates: Lenders generally reserve the lowest interest rates for applicants with high credit scores. But you should still look for the lowest APR available to you.
- Fees: Some lenders charge personal loan origination fees when you borrow. Fees may range from 1% to 8% of the amount you borrow, though some lenders charge flat fees and others don't charge any fees. But be careful not to jump at the first no-fee loan you see. Do the math to make sure that the lender isn't making up for those costs with a higher APR.
- Repayment terms: Consider how long you want to pay off the loan. A shorter repayment time will cost you less in interest overall but could stretch your monthly budget. Choose a lender that offers terms that are a good fit for you. Some let you choose which day of the month to make your payments as well, which could help you time your due dates around your paydays.
How We Chose the Best Personal Loans for Fair Credit
Our writers spent hours researching loan options from more than 50 different lenders. Recommendations are based on personal loan companies offering a combination of good interest rates, loan terms, low fees, loan amounts, speed of funding, and more. These loan recommendations take into account that all borrowers have different needs and financial situations that may require loans that meet various priorities. Not every recommendation is right for every borrower, so consider all of your options before applying.
Compare Personal Loan Rates With Our Partners at Fiona.com
Fair Isaac Corporation. "What Is a FICO Score and Why Is It Important?" Accessed Sept. 24, 2020.
Upstart. "What Fees am I Charged?" Accessed Sept. 24, 2020.
First Tech Federal Credit Union. "Explore First Tech Membership." Accessed Sept. 24, 2020.
SoFi. "Compare Rates and Terms." Accessed Sept. 24, 2020.
Marcus by Goldman Sachs. "We're Offering Personal Loans With No Fees. Ever." Accessed Sept. 24, 2020.
FICO. "Updated Infographic: What Does a High Credit Scorer Look Like?" Accessed Sept. 24, 2020.