Minimum Credit Score Needed for a Personal Loan

credit score needed for a personal loan

Personal loans are a great way of borrowing cash with a relatively low-interest rate. But unless you have pretty decent credit, you may not qualify.

So what is the minimum credit score needed to get a personal loan?

It varies depending on the lender, but some companies require a credit score as low as 580.

Get Approved for a Personal Loan with a 580 Credit Score

What is Considered Good Credit

Most personal loan lenders require borrowers to have good credit to be eligible. What does that mean? Generally speaking, a good credit score is anything over 680.

  • Excellent credit – 720+
  • Good credit – 680-719
  • Average – 640-679
  • Bad credit – 580-639
  • Terrible credit – Under 580


If you have a 680 credit score, your chances of getting approved for a personal loan are pretty high.

However, many lenders specialize in lending money to borrowers with a 580-679 credit score.

Personal loans for borrowers with a 580 credit score

Improve Your Credit Score Before Applying

If your credit score is under 680, it’s a good idea to work on improving your credit before applying for a personal loan. Not only will a higher score improve your chances of getting approved, but your credit rating determines the interest rate. You can do many things to increase your score, such as paying down credit card balances and making all your payments on time.

Ways to Raise Your Credit Score

Pay down credit card balances

The amount of available credit you’re using is called a credit utilization ratio; you want this ratio to be as low as possible. If you’re using over 30% of your total available credit, your score is being dragged down because of it. By paying the balances below 20% of the credit limits, you will maximize your credit score.

Don’t apply for new credit

When you apply for an auto loan or credit card, the lender will make a credit inquiry to check your score. Each credit inquiry will count against you, lower your score. Any new loans or lines of credit you open usually will temporarily decrease your score, so it’s best to hold off on that new car until after you get the loan.

Dispute information

Just about anything on your credit report can be disputed with the credit bureaus. If there is any inaccurate information on your report, your score may be negatively impacted. Contact the credit bureaus to dispute items like late payments, unknown accounts, and incorrect balances. The bureaus have 30 days to investigate, and if they can not confirm its accuracy, it must be deleted from your report.

Get Loan Offers from 3-4 Different Lenders

Each lender you speak to will have different loan terms, interest rates, and lender fees. You mustn’t get a personal loan from the first lender you speak to; you should speak to at least 3-4 lenders to ensure you’re getting the most competitive deal.

Comparing loans with different rates and fees can be difficult. You can look at the annual percentage rate (APR) to determine the true cost of the loan.

Use our loan comparison calculator to find out which loan offer will save you the most money.

The Bottom Line

There is no universal minimum credit score needed for a personal loan. Minimum loan requirements will vary depending on the lender.

But, some lenders offer personal loans for borrowers with just a 580 credit score.

Before you apply, you should improve your score to increase your odds of getting improved and help you secure a lower interest rate.

  • Pay down your credit card balances to less than 20% of the credit limit.
  • Hold off on applying for a new auto loan or credit card until after you get the loan.
  • Dispute any inaccurate information on your report with the three major credit bureaus


Are you ready to see if you qualify for a personal loan?

Check personal loan rates with multiple lenders