[2023 Updated] Top Personal Loans For Bad Credit & Low Income

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Updated: May 11, 2023
author photo Written by Louis BakerUpdated: May 11, 2023
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Are you facing financial difficulties and are currently in need of a loan, but you feel your low annual income and bad credit score are limiting factors?

You’re concerned you might not be able to qualify for a personal loan and you need to confirm that there are loan options available for you.

What is the best personal loan if you have bad credit and a low income?

In this guide, we’ll connect you with the appropriate lenders who offer personal loans for people with bad credit and low income. After reading through and following the steps, you should be able to better position yourself to qualify for a low-income personal loan.

Yes! You Can Get a Personal Loan With Bad Credit and Low Income

You may have to do extra work to secure a personal loan with bad credit and low income. Lenders who provide bad credit loans still have their minimum 'bad credit' score, and you could be rejected if you fall short. The loan cost for bad credit and low income is usually expensive with high rates and fees.

Cash advances, title loans, and payday loans are bad credit options but are very expensive and burdensome. For example, payday and title loans can have an annual percentage rate (APR) of up to 300%. Also, you could lose your vehicle if you don't pay your title loans in time.

However, co-signed, secured, and joint loans are easier options even with bad credit, and you can enjoy lower interest.

What Is a Low-income Personal Loan?

A low-income personal loan is a loan with no minimum income requirement or whose minimum income value is suitable for persons with low income.

Pew Research, a center that studies demographic and economic trends, defines lower income for a family of three as an annual income below $52,200 (having adjusted the 2018 data for inflation from 2018 - 2023). Nonetheless, this limit could vary based on location and standard of living.

Some lenders, like Upgrade, have no minimum requirement, while Rocket Loans have a minimum income requirement of $24,000.

Requirements for a Personal Loan

Minimum Income

The loan provider determines the minimum income requirement to qualify for a personal loan. For example, Avant requires a minimum annual income of $24,000, while you will need an income of $12,000 to be eligible with Upstart. Lenders want to ascertain that they give loans only to those who can afford them.

Credit score

Lenders consider your credit score to decide whether or not you qualify for a loan and at what rate. A higher credit score can help you qualify for a lower interest rate.

Debt-to-income (DTI) ratio

Your DTI ratio is the amount of your monthly income that goes into debt repayments. Lenders would approve loans to borrowers with a DTI of 40% and below. You can calculate your DTI ratio by dividing the sum of debts you pay monthly by your gross income in a month and multiplying by 100%.

Proof of residence

This can be a mortgage statement, driver's license, bank statement, lease agreement, or any utility bill that contains your name and residential information. Proof of residence is needed to verify your identity.

An active bank account

You will need an active bank account in your name to be eligible for a personal loan. Your bank account gives the lender insight into your financial state.

6 Steps to Get a Personal Loan With a Low Income

Step 1: Sum up your income

Add up your total income from your regular work and side hustles to see how much income you make each month.

Step 2: Calculate your DTI

If your DTI is above 40%, you could reduce it by settling some of your debt to qualify for a personal loan.

Step 3: Prequalify with lenders

Many loan providers allow you to prequalify for loans. Prequalification is a soft inquiry and does affect your credit score. It's like a quick screening of your financial situation by lenders to determine if you are likely to be approved.

Step 4: Compare loan offers and select the option that suits your need.

Compare the rates, terms, and fees of the offers you have to determine the one best suits your needs.

Step 5: Fill out the application

Fill out the application form for the option you select and provide all necessary documents like your bank statement, proof of identity, proof of address, etc.

Step 6: Get your funds

If your request is approved, you will be required to sign so the funds can be disbursed to you. Depending on the lender, you will receive the funds within the same day to a few days after approval.

Get a Low-Income and Bad Credit Loan at a Lower Interest Rate With Credityelp

CreditYelp makes it easy for you to shop for and compare as many lenders as possible to find the one that suits you. We simplify the process by requiring you to fill out just one form instead of multiple forms to get a loan.

CreditYelp is an online broker that connects clients who need loans to suitable lenders. We know how stressful it can be to borrow money, and we are committed to helping you secure a loan easily, irrespective of your credit score or financial situation.

We provide objective and all-inclusive information, expert comparison, and evaluation so you can make informed financial decisions. You can utilize our affiliation with over ten quality loan groups on our platform.

With CreditYelp, borrowing money just got easier!

Get a Personal Loan with Bad Credit and Low Income Now!

Most lenders and banks will likely see you as a credit risk if your credit falls into the bad credit range. This is where CreditYelp comes to the rescue.

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  1. Fill out the form. You shop around and compare as many lenders as you can.
  2. Each of the lenders that accept your request will send you a customized offer. You look through the offers to make an informed choice of the one that best suits you.
  3. Submit the required documents.
  4. Once your funds are approved, you wait for them to be deposited into your account as soon as the next business day.


  • Our services are friendly to borrowers with bad credit and low income.
  • We have cooperated with over ten legitimate and reliable lenders who have loan qualifications with NMLS ID#.
  • You only have to fill out one form, which will be seen promptly by more than ten reliable lenders.
  • You can enjoy affordable interest rates.
  • Higher loan approval rate
  • The lenders charge little or no origination fees.

How does CreditYelp compare

Why Choose Us?
How much can I borrow?
Up to $35,000
No hidden fees or charges
How long is the loan repayment period?
Up to 36 months
Various repayment options
Do lenders check my credit?
Soft check only
Do lenders accept bad credit?
Friendly to bad credit borrowers
Chances of approval
High approval rate
How to apply?
Apply online
No paperwork needed
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8 Tricks to Improve Your Eligibility for Personal Loans with Bad Credit and Low Income

Asides from your income, lenders consider other factors like your credit score, credit history, monthly debts, housing payments, and debt-to-income (DIT) ratio when reviewing your loan application.

You can strengthen your loan approval if you can improve all these factors. In practice, it can take a while to lower your DTI or increase your credit score. However, you can try out the following to strengthen your loan eligibility both in the short and long term:

Include Every Eligible Source of Income in the Loan Application

A variety of other sources count as income for a credit application. Ensure to add them when filling out your loan application.

Aside from your regular job, tips and bonuses, investment incomes, money earned from a side hustle, social securities, insurance payments, public assistance, alimony, child support, some scholarships, and grants also count towards your annual gross income.

Apply for Smaller Loans

If you apply for a small loan, you are more likely to be approved because you can easily pay it back even if your income is low. Also, the lender is putting little money at risk.

Get a Cosigner or Co-borrower

A cosigner or co-borrower allows you to use their good name and credit history to apply for a loan without receiving any loan proceeds. They help you obtain loans with more favorable deals, rates, and terms, as well as a higher principal than you ordinarily might have been eligible for.

The difference between a cosigner and a co-borrower is that while a cosigner is responsible for the loan only if the primary borrower fails, a co-borrower is responsible for the loan from the start.

Consider Paying down or Restructuring Your Debt

This helps boost your income by allowing you to pay fewer interest charges. If your DTI is above 40%, you can make an extra monthly payment on your debt to reduce it to qualify for an even larger credit. If you have a student loan, you can opt for an income-driven repayment (IDR) plan to reduce your monthly debt payment and reduce your DTI. 

Lower your debt-to-income (DTI) ratio

If you have a lot of outstanding debt, you need to lower your DTI ratio to convince lenders that you can handle a new financial obligation. Generally, you reduce your DTI by increasing your income or decreasing your monthly debt payments.

Practical steps in these include paying down debts with high balances, calling your lender to ask for a lower rate on debts, freezing your credit card to prevent unnecessary purchases, and taking on a side job to make more money.

Improve your credit score

If you are not eligible for a loan because of a low income, it is a good idea to build your credit score before applying again.

To improve your score, make prompt payments on all credit and utility bills, avoid new credit, keep your credit card balances low, increase your credit limit, review your credit reports for errors, have a mix of credit types, pay more than the minimum requirement on your credit card, keep paid-off accounts open, etc.

Increase Your Income

If you can't find a cosigner, look for ways to increase your income. To increase your income, start a side hustle or freelancing, sell unwanted belongings, explore tax deductions and credits, seek financial assistance programs, and join an investment program.

Negotiate a Salary Increase or Look for Another Job

You can increase your income by negotiating a raise with your employer or seeking new job opportunities. Generally, when you apply for a loan, your income is verified using pay stubs or bank statements; however, lenders sometimes accept an employment letter as evidence that your income will increase before your first payday arrives.

7 Alternatives to Bad Credit and Low-Income Loans

Personal loans are not your only option if you need to borrow money. There are other types of funding sources you can consider. They include:

Payday loans

These kinds of loans are easy to access because they have fewer requirements than other loans. Even with bad credit, you can apply for payday loans. However, they should be your resort if you need a loan because they are very expensive.

Payday loans don't consider your ability to pay, and they could create a debt trap for borrowers due to their extremely high-interest rates. They have APRs ranging from 300 - 500%. Also, they are short-term loans, and as the name suggests, they are payable on the next payday.

Credit cards

This can be a good alternative to consider if you need repeated cash access. Credit cards usually have higher rates and fees when compared to personal loans. However, you might not have to pay any interest if you pay off your debt before the stipulated date.

Credit cards give you a revolving line of credit, meaning you can use any amount of the credit you want as long as you stay within the specified credit limit. Remember that your income and credit score affect the amount of credit a creditor will be willing to give you.

Secured personal loans

A secured personal loan requires your assets, such as your house, car, future paychecks, savings account, etc., as collateral. This means that if you fail to repay, your assets will be sold to cover the cost of your loan. Be aware that your collateral must be of similar value to your loan.

For example, a secured loan is generally available only for vehicles less than five years, and you must provide documents for the lender to verify the value. Like payday loans, you can get approved for a secured personal loan with a low credit score and income.

Check with local credit unions

Credit unions are nonprofit companies; as such, they usually offer lower interest rates and better repayment terms than banks and online lenders. Check with your local credit unions to see if they have available low-income options like emergency loans or small short-term loans.

Local credit unions require you to be a union member to apply for a loan. They also have more relaxed requirements. However, you must submit your personal ID, Social Security number, and other necessary details to verify your credit score and credit report.

Payment plans for bills

If you are applying for a loan to settle big expenses like taxes, medical bills, and other utilities, you can try out a payment plan. Communicate with the billing company to negotiate available payment plans instead of taking out a loan to settle your bills.

Buy now, pay later (BNPL) offers

BNPL offers allow you to make purchases with a small down payment (usually 25% of your total purchase) and pay in installments at a future date, usually without interest. BNPL is a convenient way to pay for purchases over time, and you don't need a good credit score to qualify.

Payday alternative loans (PAL)

Several federal credit unions offer PAL as an affordable option to expensive payday loans for persons who need money to meet their needs on short notice. You can qualify for an alternative payday loan if you have enough recurring income to repay your debt.

3 Reputable Lenders Available for Low-Income Applicants

CreditYelp helps borrowers find the most suitable lenders for their needs. We provide you with a complete overview of our partner lenders and evaluate them based on the following criteria to make the best choice.

Lending Club Upstart Upgrade
APR ranges 7.04% to 35.89% 5.42% - 35.99% 7.46% - 35.97%
Loan Amounts Available $1,000 to $40,000 $1,000 - $50,000 $1,000 - $50,000
Minimum Credit Score 600 300 560
Repayment terms 36 to 60 months 36 to 60 months 36 to 60 months
Time to Receive funds Next day Next day Same day


1. Can I get a loan if I am unemployed or self-employed?

Yes. Loans for the unemployed and self-employed are possible, but they may be difficult. This is because lenders prefer borrowers with evidence of employment and a steady income rather than those with fluctuating or no income.

However, you can get some offers if you fulfill the loan requirements and prove your creditworthiness with a satisfactory credit history. Check your category below to know what to expect:

  • Unemployed: If you are unemployed, you must prove to your lender that you have an alternative income source. They can take a look at your investments, retirement benefits, spouse's income, alimony, and child support income. They also consider your DTI ratio and credit history to evaluate your loan application.

  • Self-employed: If you are self-employed, your lender might require you to show your pay stubs or wage and tax statement as proof of income - which you may have a tough time producing because you are self-employed. However, some lenders can accept your bank statements and tax returns to process your loan application.

Both categories are at risk of missed payments, shorter repayment terms, and higher interest rates. Be careful not to make your financial situation worse by signing up for a loan you cannot afford.

2. What are my No-Income Personal Loan Options?

A no-income loan is granted by lenders to people whose income does not come from traditional sources of income, like a full-time job.

To qualify for this loan, your lender will verify that you have sufficient liquid assets or alternative sources of income to repay the loan. These assets include your house or real estate, appraised valuables, government bonds, and vehicles.

With no income, the two main loan options you have are unsecured and secured personal loans.

A secured personal loan is a loan that is obtained using your property and other financial assets like a car, house, savings account, stocks, mutual funds, and life insurance as collateral. If you don't repay as when due, the lender has the legal right to sell the asset to cover your loan cost.

An unsecured loan doesn't need collateral to be granted. It is largely approved based on your credit score and past record of repaying debts. Although it sometimes has a higher interest rate than a secured loan, it is a more flexible option because you are not at risk of losing an asset. It is also faster because it involves less paperwork.


You now understand how to get personal loans with bad credit and low income. You also know how to improve your eligibility for a personal loan if you have a low income and other alternatives to bad credit and low-income loans.

With CreditYelp, you can find a low-income and bad credit loan that suits your needs. We make it easy for you to find and compare many reputable lenders so you can secure a loan irrespective of your financial situation. Get started with us today.

author photo

Written by

Louis Baker


Louis Baker started his career in 2017 by contracting with Experian. He also became a part-time content creator in various fields such as insurance, personal finance & investment, etc.

Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own.
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