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If you’re in a crunch and need cash immediately, an emergency personal loan might do the trick. Personal loans are often safer and less expensive than their rightfully maligned cousins, payday and title loans. But even though you’re not at risk of paying 400% APR on a personal loan, it’s still wise to shop around to find a lender that offers an affordable loan that meets your needs.
Upgrade is another lender that can fund loans within 24 hours of approval. You can borrow up to $50,000 per loan to cover everything from emergency medical debts to business expenses, or as little as $1,000 for smaller, urgent needs. But bear in mind that the lender’s origination fees are deducted from your loan amount, meaning you’ll need to request more than you need.
>> More: Upgrade Personal Loan Review
Upstart is an online lending platform that uses AI to consider alternative data such as your education and job history to determine your eligibility. The lender can fund up to $50,000 within one business day of approval, making it an ideal emergency loan. And while Upstart limits loan terms to 3 or 5 years, there’s no penalty for paying it off early.
>> More: Upstart Personal Loan Review
OneMain Financial often works with borrowers who have lower credit scores and can lend anywhere from $1,500 to $20,000. The lender does charge a higher-than-average APR and potentially high origination fees, depending on your state. Still, bad credit borrowers may pay less with OneMain than at a typical payday lender, making them a better option for emergency loans. You can also cancel your loan within 7 days with no penalty.
Best Egg offers a quick online application and up to next-day funding for over 50% of qualified applications. Typically, this lender is best for those with a great credit history, low debts, and higher incomes than average. But those who qualify for its lowest rates may still pay origination fees as high as 6.99%, as well as late payment and NSF fees. That said, there are no prepayment penalties to worry about.
>> More: Best Egg Personal Loan Review
LendingPoint offers loans ranging from $2,000 to $36,500. Qualified borrowers can apply in minutes and receive approval within the hour, with next-day funding available. Additionally, the lender doesn’t set minimum income requirements and has a high debt-to-income ratio, making it ideal if you need cash in a hurry. Plus, you can repay your loan early with no penalty.
>> More: LendingPoint Personal Loan Review
Avant is a relatively accessible online lender that offers a low minimum credit score requirement, fast funding, and both secured and unsecured loans. You can prequalify online for sums as large as $35,000, though Avant doesn’t accept cosigners or co-borrowers. Note that you can’t use an Avant personal loan to cover emergency business expenses, and the APR includes a 4.75% administration fee.
>> More: Avant Personal Loan Review
FreedomPlus partners with MetaBank and Cross River Bank to offer personal loans to eligible applicants. They offer funding within 72 hours, flexible loan terms, and a reasonable APR at the low end. However, with a minimum loan of $7,500 and a borrowing cap of 35% of your income, you have to make at least $21,500 per year to qualify.
>> More: FreedomPlus Personal Loans Review
Rocket Loans, the sister company to the famed Rocket Mortgage, offers a quick online application, near-instant approval, and the possibility of same-day funding. Their availability in most states and relatively low minimum credit score make them a reasonable option for bad credit borrowers. However, you should have at least 2 years of credit history to apply, and you may face origination fees up to 6%.
>> More: Rocket Loans Review
SoFi is an online lender that caters to clients who have good to excellent credit scores and higher incomes. They stand out for their extended repayment period, high maximum loan amounts of $100,000, and relatively low APRs. However, poor credit borrowers are unlikely to qualify, and the minimum loan amount of $5,000 is fairly high.
>> More: SoFi Personal Loans Review
Prosper is a peer-to-peer online community that offers both personal loans and investment services. Prospective borrowers can match with investors willing to fund the borrower’s needs. That said, the actual lending is done through WebBank, a third-party partner. To qualify, borrowers must have a minimum credit history of 2 years and a debt-to-income ratio under 50% (excluding your mortgage).
>> More: Prosper Personal Loan Review
Most lenders don’t actively advertise “emergency loans.” Instead, they sell personal loans that you can use for emergency expenses, like medical bills, funeral arrangements, car repairs, and other urgent expenses. Once your emergency passes, you repay your debt over time, just like any other loan.
Emergency loans work like any other personal loan. You can apply online, in person, or over the phone at a bank, credit union, or online personal loan lender. The lender will approve or deny your loan based on factors like your income, credit score, and debt-to-income ratio. Some creditors also permit joint applicants or co-signers (though not all do). The best emergency loans also offer next-day or same-day funding.
However, emergency personal loans may come with high-interest rates – especially those that cater to bad credit borrowers. You may also face expenses like origination, late, and insufficient fund fees on top of your interest rate. And some lenders place restrictions on how you spend your money. (Excluding business and education expenses is common).
The best way to get a fast personal loan is to hop online and find lenders that offer same-day or next-day funding. If you want to avoid costly fees and high APRs, you’ll want to shop around for affordable options.
Credit unions often offer emergency or other quick personal loans among their products. Many also promote “payday alternative loans” between $200 and $1,000, which are ideal if you need a small sum in a hurry. And while credit unions are often friendlier toward bad credit borrowers, many have membership or account age requirements to borrow.
Speed is often your priority in an emergency, but don’t neglect the financial consequences of your actions as a result. Consider a loan’s total cost before accepting a lender’s terms, including the interest rate, fees, and time spent repaying your debt.
In an emergency, fast funding is often paramount. Lenders may take anywhere from a day to a week to fund personal loans. If they don’t make it clear online how long the process should take, don’t be afraid to ask a representative.
In the digital age, just about everything happens online – and that’s doubly true post-pandemic. If your lender requires you to meet in person to close your loan, you may want to opt for one that’s more accessible.
Your credit score and income determine important features like your loan amount and interest rate. Unfortunately, if you have low income and bad credit, you’ll likely have a harder time getting approved. That said, you still have options, so be sure to rate shop until you find the most affordable lender for your situation.
Payday loans typically offer small amounts – under $1,000 or so – that you repay out of your next paycheck. Some may even request access to your bank account to withdraw the money you owe as soon as your check hits.
Instead of interest, they tend to charge fees per amount borrowed that may come out to a 400-600% APR. And because they don’t require a credit check, they tend to target bad credit borrowers who may not be able to afford other options – let alone their predatory terms.
Pawn shops will pay out loans to borrowers willing to put up the junk around their house as collateral. But you won’t get anywhere near the item’s full value – rarely over 60% – and if you want your item back, you’ll have to repay your loan plus interest and fees. If you can’t afford to repay your loan, you stand to lose your valuables forever.
Car titles loans require you to sign over the title of your car as collateral for a loan. But make no mistake – this isn’t like your regular auto loan or even a HELOC. Despite putting up collateral, car title loans still tend to charge triple-digit APRs, tons of fees that pile on top of your debt, and expensive “rollover” options to extend your loan when you can’t afford to repay it in full. Ultimately, if you can’t repay your debt, you risk both your credit score and your car title.
Credit card cash advances are cash loans borrowed against the limit on your credit card. Interest rates on these advances trend higher than APRs for regular purchases. Plus, they often come with additional fees, including transaction and processing fees. And for most cards, interest starts piling on when you withdraw your loan – there’s no grace period like you have with regular credit card purchases.
Emergency loans come with several advantages, including:
But emergency loans aren’t risk-free. They also come with significant disadvantages like:
Bad credit scores don’t automatically disqualify you from getting a loan, but they do make the process harder – and more expensive. If you have a FICO score under 620 or so and need an emergency loan, you do have options. Just prepare to pay higher interest rates or origination fees for the privilege.
To make emergency loans more accessible as a bad credit borrower, you might also consider:
The best way to ensure you don’t need to take out a loan in an emergency is to build up a savings fund over time. Set a goal – such as 3 months’ worth of household expenses – and commit what you can afford every month. Even if that’s just $10 a week, that’s $520 a year you didn’t have before!
You might also consider automating your savings straight from your paycheck, so you aren’t tempted to spend the money immediately. While paying yourself first isn’t always easy, your future self will thank you.
An emergency loan can get you through tough times – but the long-term financial consequences are very much real. Before committing to a loan, be sure to rate shop and read the fine print to ensure you’re not paying more in fees and interest than you have to. And when possible, avoid predatory lenders that promise same-day funding with no credit check.
Methodology
To select the best emergency loans, we reviewed 25+ lenders that offer personal loans for emergency expenses. Our evaluation included reviewing the lenders online experience, eligibility requirements, customer support, and funding times. Read our editorial guidelines and rating methodologies for quick loans to learn more about the integrity, transparency, and honesty of our reviews.
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Jordan Blansit is a Senior Writer, Researcher, & Product Analyst for SimpleMoneyLyfe with an inexplicable predilection for mortgages, investing, and personal finance. When she’s not click-clacketing from the comfort of her living room, you can find her in the California Redwoods or Oregon Siskiyous. Jordan’s areas of expertise are mortgages, personal loans, credit cards, and investing.
