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Fair credit, also called “average credit” is that gray zone between poor credit – and the subprime loans that come with it – and good credit, where the better credit deals are. You’ll eventually want to move up to good or even excellent credit. But until you do, you’ll have to dig to find the best personal loan deals available for your credit score range.
In this article, we’re going to try to do just that. It is possible to get a personal loan with fair credit, and it’s definitely possible to improve your credit.
Overview of the best lending sources for people with fair credit
FionaShopping by credit ratingStarts at 2.49% APR6 to 144 months
CredibleAvoiding hidden feesRates starting at 4.99% APR (with AutoPay), See Terms*24 to 84 months
MonevoMost lender comparisons2.49% – 35.99% APR12 to 144 months
AvantBuilding credit7.99% to 35.99% APR24 to 60 months
LendingPointBorrowers with low debt7.99% to 35.99%24-72 months
SoFiAutopay discounts5.99% to 18.85% APR (with autopay)24 to 84 months
UpstartFast online approvals8.94% to 35.99% APR36 to 60 months
ProsperQuick funding times7.95% to 35.99% APR36 to 60 months
The best lending sources for people with fair credit
Exactly where to get financing when you have fair credit is something of a balancing act. Fair credit means that you are floating somewhere between good credit and poor credit. How your credit will be considered will depend on the institution you apply with and their own specific credit score requirements.
These aren’t direct lenders, but rather websites that give you access to dozens or even hundreds of different lenders across the country. You fill out a brief application, including the purpose of your loan request, and various lenders will make loan offers. That can save you a lot of shopping around.
Fionalets you simply complete a single loan request and receive multiple offers. You can then select which lender will provide the best one for your needs. It will save you the trouble of needing to determine the credit requirements of each lender.
starting at 4.99% APR (with AutoPay),
is another loan aggregator that shops multiple lenders after you provide some basic information. One of the best things about Credible, though, is how quickly you can have the funds. Some borrowers see the money in their accounts as early as one business day after closing. Plus, with rates
, you’ll have a wide range of options.
compares 30 lenders and you won’t hurt your credit score when reviewing your personal loan offers. Plus, rates are competitive with qualified borrowers locking in an APR between
2.49% – 35.99% APR
. While you might not get the best rate possible with fair credit, it does mean there could be more flexibility than a lender that starts even their best borrowers at a higher rate.
To get a sense of what loans you qualify for, check out some lenders available in your area below:
Personal loan lenders
There are also some lenders that will work with consumers who have fair credit.
gives you access to funds of up to $35,000 by the next business day. Interest rates range from 9.95% to 35.99% APR. Plus, your payments will be reported to the three credit bureaus, so you’ll continue to build a positive credit history as long as you make your payments on time.
innovative technology allows us to understand the unique credit worthiness of every applicant – we serve 85% of the FICO population. Near instant credit decisions for loans from $2,000 to $36,500 that include flexible payment terms from
, rates ranging from
7.99% to 35.99%
APR and next business day funding upon approval
gives borrowers a 0.25% interest rate deduction by enrolling in autopay. Plus, you don’t have to worry about expensive fees adding to your loan balance — SoFi doesn’t charge origination fees, late fees, or pre-payment fees. Borrow up to $100,000 with loan terms as long as seven years.
Peer-to-Peer (P2P) lenders
For personal loans that are unsecured, these may be the best sources. Most will lend up to $35,000, which can be used for any purpose. That can include debt consolidation, medical expenses, financing a business startup, or even purchasing a car. Best of all, they offer financing for nearly all credit scores.
online form and rate check process only takes five minutes. It’s common to get instant approval and most loan funds are received within a day. Upstart boasts a higher approval rate compared to traditional lenders and uses a diverse range of qualifying factors beyond your credit score.
lets borrowers access up to $40,000 in loan funds. You can check your rate online and choose from multiple offers. You can then accept the one that works best for you and get funded in as little as one business day.
Other types of loans for fair credit
Banks and credit unions
How successful you will be with these lenders depends on your specific credit score. The credit score range of 580 to 669 is wide and covers a lot of people. Some banks and credit unions may be perfectly willing to make you a loan with a minimum score of 650 or even 620. But a credit score below 620 will be a problem.
Credit unions will generally be better than banks since they’re nonprofit and member-owned. Even so, it will help your cause to have a large savings amount with that institution, otherwise, you may need to bring a cosigner.
Home equity loans
With a home equity loan, you take a loan out on part or all of the equity you’ve built in your house. Another option is a home equity line of credit (HELOC), which turns your equity into a line of credit you can draw on as needed. Both of these can be great sources of income if you’re at the higher end of the fair score credit range.
Here is a lender to look into:
- Hometap, on the other hand, buys a stake in your home’s future value (aka, they invest in it), giving you the cash you need now without added debt or interest. Then, when you’re ready to sell the house, Hometap takes its share of the profits.
These are more a consideration if you’re on the lower end of the fair credit score range. But you should avoid these entirely. Payday loans are tied to your paycheck, which is where the name comes from. They’re very short-term loans, secured by your next paycheck. You take a loan on that paycheck, at an interest rate that can be over 300%.
You also authorize the lender to take an automatic debit from your bank account when your paycheck comes in. It may get you money now, but when your next paycheck comes you’ll be short again. That’s why most people who take one payday loan end up getting caught on the payday loan treadmill. It doesn’t end well for most borrowers.
Getting an auto loan with fair credit
If you have fair credit, you probably don’t want to get a loan from a car dealer. They’ll almost certainly put you into a subprime loan. I know someone who was put into a six-year loan with a 23% interest rate by a dealer. That’s the last thing you need.
The best approach is to apply with your bank. An even better strategy is to use a credit union. Credit unions are member-owned, and more likely to make loans that banks won’t. They won’t take poor credit, but they will consider fair credit with extenuating circumstances.
If your credit score doesn’t meet the bank or credit union standards, offer to do one or more of the following:
- Get a cosigner who has good or excellent credit.
- Make a large down payment. 20% or more could make a real difference because it lowers the lender’s risk.
- Buy less car than you can afford.
You can also check offers from multiple lenders by going through a free aggregator like Monevo. In just a few minutes (or less) Monevo can give you quotes from 30 different lenders after you enter some basic personal information. Plus, your credit score won’t be affected.
Getting a mortgage with fair credit
Contrary to popular belief, it’s actually possible to get a mortgage with fair credit. Most mortgage lenders will provide prime-level loan rates with credit scores as low as 620. Some will go as low as 600, and a few as low as 580.
Generally speaking, your best mortgage bet with fair credit is an FHA mortgage. They won’t accept poor credit, but they’re more lenient than conventional mortgages.
If you do apply for a conventional mortgage, you might get a better deal if you have some offsetting factors. These include the following:
- Making a large down payment – 20% or more of the purchase price.
- Having only a small increase in your new house payment.
- Buy less house than you can afford.
- Get a cosigner who has good or excellent credit.
Any of these factors can enable you to get a conventional mortgage even with a low credit score. However, lenders won’t go below a 580 credit score, and not many will go below 620. Check with the lenders in your area that are known to be the most lenient with credit.
If you’re looking for a good site that aggregates the best mortgages online and presents you with the lowest rates, check out Credible. Credible Operations, Inc. NMLS# 1681276, “Credible.” Not available in all states. www.nmlsconsumeraccess.org.”
Credible can help match you with the right lender based on your needs and credit quality, and the whole process takes a matter of minutes.
Fiona is another online loan marketplace to consider. If you have fair credit, you simply choose that from the drop-down box and Fiona will provide a list of lenders offering loans for those with your credit range and your requested amount.
Credit cards for people with fair or average credit
The difference between poor credit and fair credit isn’t always obvious with credit card lenders. What’s more, they but don’t typically publish their credit score requirements. That can turn the search for a decent credit card into something of a fishing expedition.
But below is a list of credit card companies known to provide cards for people with fair credit: