Best Hardship Loans for Bad Credit in 2024

Personal loans to cover finances during hard times

Checking rates won't affect your credit score

How Does LendingTree Get Paid?
LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.

How Does LendingTree Get Paid?

LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
Privacy Secured  |  Advertising Disclosures
 

Best financial hardship loan lenders

Written by Amanda Push | Edited by Kurt Adams and Xiomara Martinez-White | Updated on January 26, 2024
How Does LendingTree Get Paid?
LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.

How Does LendingTree Get Paid?

LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
LenderUser ratingsBest for…APR rangeLoan termsLoan amountsMinimum credit score
Avant logo
(2,682)
User Ratings & Reviews rating-reviews-tooltip-icon

Ratings and reviews are from real consumers who have used the lending partner’s services.

Short-term hardship loans9.95% to 35.99%12 to 60 months$2,000 - $35,000580See Personalized Results
One Main Financial logo
(7,948)
User Ratings & Reviews rating-reviews-tooltip-icon

Ratings and reviews are from real consumers who have used the lending partner’s services.

Secured hardship loans18.00% to 35.99%24 to 60 months$1,500 - $20,000Not specifiedSee Personalized Results
Universal Credit logo
(129)
User Ratings & Reviews rating-reviews-tooltip-icon

Ratings and reviews are from real consumers who have used the lending partner’s services.

Hardship loans to consolidate debt11.69% to 35.99% (with discounts)36 or 60 months$1,000 - $50,000560See Personalized Results
Upgrade logo
(2,184)
User Ratings & Reviews rating-reviews-tooltip-icon

Ratings and reviews are from real consumers who have used the lending partner’s services.

Hardship loans with flexible repayment terms8.49% to 35.99% (with autopay)24 to 84 months$1,000 - $50,000580See Personalized Results
Upstart logo
(16,291)
User Ratings & Reviews rating-reviews-tooltip-icon

Ratings and reviews are from real consumers who have used the lending partner’s services.

Hardship loans for bad credit7.80% to 35.99%36 and 60 months$1,000 - $50,000300See Personalized Results

Get Personalized Rates

Top lenders for hardship loans

Avant logo

Avant: Best for short-term hardship terms

APR range9.95% to 35.99%
Loan amounts$2,000 - $35,000
Loan terms12 to 60 months
Origination feeUp to 9.99%
Minimum credit score580
ProsCons

 Funding within one business day

 Allows for bad-credit borrowers

 Offers short repayment terms

 Charges an administrative fee

 Small maximum loan amount

 Not available in all 50 states

See Your Personalized Results

One Main Financial logo

OneMain Financial: Best for secured hardship loans

APR range18.00% to 35.99%
Loan amounts$1,500 - $20,000
Loan terms24 to 60 months
Origination fee1.00% - 10.00%
Minimum credit scoreNot specified
ProsCons

 Offers secured and unsecured loans

 Bad-credit borrowers may be able to qualify

 Borrowers can get small loans

 You can find lower APRs with other lenders

 Charges an origination fee

 Doesn’t offer large loan amounts

See Your Personalized Results

Universal Credit logo

Universal Credit: Best for hardship loans to consolidate debt

APR range11.69% to 35.99% (with discounts)
Loan amounts$1,000 - $50,000
Loan terms36 or 60 months
Origination fee5.25% - 9.99%
Minimum credit score560
ProsCons

 Pays old creditors off directly

 Allows for co-applicants

 Funding within one business day

 High maximum APRs

 Charges an origination fee

 Charges late fees

See Your Personalized Results

Upgrade logo

Upgrade: Best for hardship loans with flexible repayment terms

APR range8.49% to 35.99% (with autopay)
Loan amounts$1,000 - $50,000
Loan terms24 to 84 months
Origination fee1.85% - 9.99%
Minimum credit score580
ProsCons

 Offers flexible repayment terms

 Allows for joint applications

 Funding within one business day

 High maximum APR

 Charges an origination fee

 Charges late fees

See Your Personalized Results

Upstart logo

Upstart: Best for hardship loans for bad credit

APR range7.80% to 35.99%
Loan amounts$1,000 - $50,000
Loan terms36 and 60 months
Origination fee0.00% - 12.00%
Minimum credit score300
ProsCons

 Bad-credit borrowers can qualify

 Funding within one business day

 Can change your due date as long as you meet Upstart's criteria

 Limited to just two repayment terms

 Charges an origination fee

 No option for co-applicants

See Your Personalized Results

What is a hardship loan?

A hardship loan is a type of personal loan that you can use if you find yourself in dire financial straits. Similar to emergency loans, hardship loans can cover the cost of living or unexpected costs.

Breaking up your day-to-day expenses with a hardship loan can ease the burden on your budget, helping to bridge the gap while you get back on your feet. However, since hardship loans can come with interest rates and fees, they can also put you in a worse financial position — especially if you’re stuck with a high cost of borrowing.

How do financial hardship loans work?

Hardship loans come in the form of a lump sum of money as opposed to a line of credit, like a credit card. This type of debt can be unsecured or secured, though most lenders only offer unsecured loans.

Since hardship loans are a type of personal loan, they also have fixed annual percentage rates (APRs), repayment terms and monthly payments. With these features, your monthly payments won’t change and you’ll know exactly when your loan will be paid off.

How to get a hardship loan

Applying for a hardship loan is essentially the same process as applying for any personal loan. While the details may vary depending on the lender, here’s the general process you may go through:

  • Review your budget. Create a budget and determine how much you can afford to borrow. To help with this, examine areas where you can cut back so you won’t have to borrow as much.
  • Check your credit score. Since your credit score will determine which lenders you can qualify with and what rates they may offer, it’s important to understand where you stand. If your credit background is poor, consider taking some time to improve your credit score.
  • Prequalify for multiple hardship loans. Choose at least three lenders and see what rates, terms and amounts you may be eligible for. Prequalifying for a personal loan won’t impact your credit score, but keep in mind that these offers aren’t set in stone.
  • Verify your information. Once you choose a lender, you may have to fill out a formal application and verify your identity and income. Your lender will also perform a hard credit pull. This can cause your credit score to temporarily drop by a few points.
  • Close on your loan. In the final step, you’ll need to sign a personal loan contract, agreeing to repay the debt on time and in full. Once you’ve signed your agreement, your lender will send your funds and you’ll have to start making payments.

How to get a hardship loan with bad credit

Bad credit can make it difficult — but not impossible — to get a hardship loan. If your credit score leaves a lot to be desired, but you need a personal loan quickly, you can apply for a bad credit loan or use one of the following strategies:

  • Add a cosigner. It may be easier to qualify for a cosigner loan than a traditional loan, since there are two people agreeing to repay the debt instead of one. A personal loan cosigner can be a family member or friend. Just make sure your cosigner understands that they are equally responsible as you are for repaying the loan.
  • Apply for a secured loan. This can come with some risks, as secured loans require collateral — a vehicle, real estate or savings account, for example. The collateral serves as your guarantee to the lender to repay the loan — if you’re unable to, your lender can seize the asset. However, secured loans tend to come with lower rates than unsecured loans and may be easier to qualify for.

How do you qualify for a hardship loan?

Hardship loan lenders will consider multiple factors when you apply, like your credit score, debt-to-income ratio (DTI) and income. Personal loan requirements vary by lender, but you’ll generally want a good DTI ratio and at least a fair credit score. Credit utilization and your payment history are some of the biggest factors in determining your credit score.

Your DTI ratio is how much money you’re spending versus how much you’re bringing in. It’s best practice to keep your DTI ratio under 43%, though a “good” number is considered 35% or less.

Other options for hardship loans

Hardship loans aren’t a one-size-fits-all solution to your financial problems — in some cases, they may not be a good fit at all. If so, consider these alternatives to hardship loans to help make ends meet:

  • Credit counseling: If you’re financially struggling because of debt, a credit counselor can help you come up with a plan and advocate to your lenders on your behalf. If you qualify, your credit counselor can put you on a debt management plan.
  • Family loans: If your loved ones are willing to help you cover expenses, consider taking out a family loan. This can help you save money on interest and fees. However, it can be a source of tension, so be sure to write out a loan agreement specifying a payment schedule, fees and interest.
  • 401(k) hardship loans: If you’ve built up a retirement account at work, you may be able to pull funds in what’s known as a 401(k) hardship loan. To avoid paying taxes on this loan, the IRS dictates that the money must be for an “immediate and heavy financial need” and limited to a “necessary” amount.
  • Payday alternative loans: Though uncommon, payday alternative loans (PALs) are a much more affordable option than payday loans. PALs are offered by credit unions and come with an APR cap of 28%.
  • Buy now, pay later: Many retailers offer buy now, pay later as an option to finance products, including groceries. This is a type of installment debt that allows you to split expenses into four equal payments with no interest or fees. Buy now, pay later apps can be found with most large retailers.
  • Cash advance apps: Some apps allow you to borrow money ahead of your paycheck without interest or credit checks. However, paycheck advance apps typically only offer small loans and are often a short-term solution to deeper financial issues.
  • Home equity loans or lines of credit: If you own your home, you can tip into the equity you’ve built into it using a home equity loan or home equity line of credit (HELOC). Keep in mind that these types of debts are secured by your home, so if you’re unable to keep up with payments, you could lose the roof over your head.
  • Student loan hardships: If keeping up with your student loan payments is a struggle, you can apply for student loan deferment or forbearance depending on your lender. In some cases, you may even qualify for student loan forgiveness, though you may need to meet strict qualifications.

Hardship loans you should avoid

Some companies with predatory lending practices specifically target consumers who are financially struggling. These types of hardship loans typically don’t come with credit checks and are quickly funded. While not all no-credit-check lenders are bad, some charge sky-high rates and fees that can trap you in a cycle of debt.

It’s best to avoid the following types of loans:

  • Payday loans: These types of hardship loans can come with nearly 400% APRs. Payday loans are typically capped at $500 and borrowers usually have two to four weeks to repay it. The short repayment terms, on top of their three-digit APRs, can lead to consumers having to take out more debt to pay off the original payday loan.
  • Pawnshop loans: This type of debt can also come with large fees and short repayment terms. In some cases, pawnshop loans may require that you provide valuable collateral — and if you can’t repay the debt, your lender can keep it.

How we chose the best hardship loans

We reviewed more than 25 lenders that offer hardship loans to determine the overall best five lenders. To make our list, lenders must offer competitive annual percentage rates (APRs). From there, we prioritize lenders based on the following factors:

  • Accessibility: Lenders are ranked higher if their personal loans are available to more people and require fewer conditions. This may include lower credit requirements, wider geographic availability, faster funding and easier and more transparent prequalification and application processes.
  • Rates and terms: We prioritize lenders with more competitive fixed rates, fewer fees and greater options for repayment terms, loan amounts and APR discounts.
  • Repayment experience: For starters, we consider each lender’s reputation and business practices. We also favor lenders that report to all major credit bureaus, offer reliable customer service and provide any unique perks to customers, like free wealth coaching.

LendingTree reviews and fact-checks our top lender picks on a monthly basis.

Frequently asked questions

Yes, hardship loans are real types of personal loans that are used to bridge the gap between income and expenses. Just as with other types of personal loans, you’ll need to meet lender requirements and make on-time payments.

You’ll have to pay back a hardship loan just as you would with any other type of debt. If you’re unable to repay it, defaulting on a loan can have a negative, heavy affect on your credit score and can impact future borrowing opportunities.

A financial hardship is considered when a person isn’t able to or just barely able to keep up with their everyday needs. If you can’t pay your bills, you’ll need to budget which expenses will need to be paid first and which ones can wait.