Having a fair credit score—typically between 580 and 640—can make borrowing more challenging, but it doesn’t mean personal loans are out of reach. Many lenders still work with borrowers in this range, offering options that can help consolidate debt, cover emergencies, or finance big purchases. The key is knowing which lenders are most friendly to fair credit applicants and what terms you can realistically expect.
In 2025, personal loan interest rates for fair credit borrowers are higher than for those with excellent credit, but they can still be much lower than credit card APRs. Some lenders even offer flexible terms, co-signer options, or secured loans that make approval easier and rates more manageable. Choosing the right lender can save you hundreds—or even thousands—over the life of the loan.
Approval isn’t just about your credit score. Lenders also look at your income, employment history, and debt-to-income (DTI) ratio. Keeping your DTI under control, showing steady income, and opting for autopay discounts can all improve your odds. For those just starting to rebuild their credit, smaller loan amounts or lenders that consider alternative data—like education or career history—may be the best fit.
It’s also worth comparing fees, not just rates. Some lenders charge origination or late payment fees that add to the cost of borrowing. Others waive fees entirely, making them a better choice for borrowers trying to minimize expenses while rebuilding credit.
In this guide, we’ll break down the best personal loan options for fair credit borrowers in 2025, highlight what to look for in terms of rates and fees, and share tips to improve your approval chances. With the right approach, even borrowers in the 580–640 range can access affordable financing and take steps toward stronger financial health.
Table of Contents
Why Your Credit Score Matters for Personal Loans
Your credit score plays a huge role in determining whether lenders approve your application and what interest rate you’ll pay. According to Investopedia, a fair credit score typically means your annual percentage rates (APRs) will be higher compared to prime borrowers. However, lenders consider other factors as well:
- Income and employment stability
- Debt-to-income ratio (DTI)
- Loan purpose
- Collateral (if a secured loan)
If you know how lenders evaluate you, you can increase your chances of approval without falling prey to predatory high-interest loans.
Best Personal Loans for Fair Credit (580–640) — Top Lenders
Here is a breakdown of lenders well-suited for borrowers with fair credit. These companies are known for relatively flexible underwriting, transparent fees, and fast funding.
| Lender | Minimum Credit Score | APR Range | Loan Amounts | Funding Time |
|---|---|---|---|---|
| Upgrade | 580 | 8.49% – 35.99% | $1,000 – $50,000 | 1–3 business days |
| Avant | 580 | 9.95% – 35.99% | $2,000 – $35,000 | As soon as next day |
| LendingPoint | 580 | 9.99% – 35.99% | $2,000 – $36,500 | 24–48 hours |
| Upstart | 600 | 6.5% – 35.99% | $1,000 – $50,000 | Next day funding in most cases |
| OneMain Financial | No minimum but reviews credit history | 18% – 35.99% | $1,500 – $20,000 | Same day in branches |
How to Apply for Personal Loans With Fair Credit
The application process is simple but requires careful preparation to avoid rejections or predatory offers. Here’s how to do it step-by-step:
- Check your credit report: Visit AnnualCreditReport.com for a free copy of your credit report.
- Determine loan purpose: Whether consolidating debt, covering medical bills, or paying for major expenses, knowing your use case helps lenders evaluate you.
- Compare prequalification offers: Many lenders, including Upgrade and LendingPoint, allow you to see personalized offers with only a soft credit check.
- Gather documentation: You’ll likely need proof of income (pay stubs, W-2s), government-issued ID, and bank account details.
- Submit application: Apply online with accurate data to avoid delays.
- Finalize acceptance: Review the contract carefully for hidden fees before signing.
Fees and Costs to Expect With Fair Credit Personal Loans
Lenders often charge additional fees when serving borrowers with fair credit scores. Expect some of the following:
- Origination fees: Usually ranging from 1% to 10% of the loan amount.
- Late payment fees: Flat fee or percentage of payment. Avoid this by setting up auto-pay.
- Prepayment penalties: Most lenders in this list allow penalty-free early repayment.
Secured vs. Unsecured Personal Loans for Fair Credit
You may qualify for better rates with a secured loan, but risks differ:
- Unsecured personal loans: No collateral, higher APRs, easier to sign up for online.
- Secured personal loans: Backed by assets (like your car or savings account), potentially lower APRs, but risk of losing collateral.
Tips to Boost Approval Odds With Fair Credit
Improving even a few points on your credit score can unlock better offers. Here are strategies:
- Pay down balances to reduce credit utilization.
- Fix errors on your credit report.
- Add a co-signer with stronger credit.
- Choose loan amounts realistically aligned with your income.
- Automate payments to avoid missing due dates.
Alternatives to Personal Loans When You Have Fair Credit
If personal loan rates are too high, consider alternatives:
- 0% APR credit cards (intro period): Best for smaller debts if you can pay off before the promotion ends.
- Local credit unions: Member-focused lending often provides better terms for fair credit borrowers.
- Peer-to-peer lending platforms: May approve loans banks won’t underwrite.
- Debt management plan: Through non-profits certified by the Consumer Financial Protection Bureau (CFPB).
Setting Up Automated Loan Payments
Auto-pay ensures you never miss a payment. Most lenders offer a 0.25% APR discount if you enable it. Here’s how to set it up:
- Log into your loan servicer’s website.
- Navigate to “Payment Options” or “AutoPay Setup.”
- Enter your bank account details (routing and account number).
- Choose payment date — ideally right after your payday.
- Confirm and save settings. Monitor account for first draft.
Frequently Asked Questions
- What is considered a fair credit score?
Scores between 580 and 669 typically fall under fair credit, though the best personal loans for fair credit 580–640 specifically target the lower fair range. - Can I get denied even if I meet the minimum credit score?
Yes. Lenders also evaluate your debt-to-income ratio, income stability, and payment history. - What APR should I expect with fair credit?
Most personal loan APRs will fall between 9% and 36% when your score is in the 580–640 range. - Are there personal loans without origination fees?
Some lenders like LightStream and Marcus by Goldman Sachs offer no-fee loans, but they may require higher credit scores than 640. - How fast do fair credit loans fund?
Many lenders approve and fund within 24–48 hours, especially with online applications. - Does applying for multiple loans hurt my score?
Prequalification involves a soft inquiry and won’t affect your score. Submitting official applications results in hard inquiries that can lower your score slightly. - Can I refinance a personal loan later when my credit improves?
Yes. Many lenders allow refinancing at lower rates once you build stronger credit. - Do personal loans for fair credit allow co-signers?
Some lenders such as Upgrade and LendingPoint allow co-signers or joint applications to improve your approval odds. - What’s the maximum I can borrow with fair credit?
Most lenders cap amounts between $20,000 and $50,000 for fair credit borrowers. - Should I choose a fixed or variable rate loan?
Fixed rates are typically better for predictability and stability, especially with fair credit.
Conclusion
Getting the best personal loans for fair credit 580–640 requires strategy, research, and careful choices. While you may face higher rates than borrowers with prime credit, reputable lenders like Upgrade, Avant, and LendingPoint make fair credit lending accessible with transparent terms. Always compare multiple offers, read the fine print, and take advantage of features like prequalification and auto-pay discounts.
Start your search today — even with fair credit, the right loan can consolidate debt, cover life’s emergencies, and help build a stronger financial future.
