Best Loans for Bad Credit in California for 2024

With a MoneyGeek score of 94 out of 100, the best loans for bad credit in California can be found at Happy Money, noted for its excellent customer service and smooth application process.

Updated: July 26, 2024

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Happy Money stands out as California's best personal loan lender for bad credit, with a MoneyGeek score of 94 out of 100. It provides quality service, a quick application and approval process, and is transparent about its loan terms. Avant is a close runner-up, scoring 92 out of 100. It showcases broad payment options, a swift application process and competitive rates.

In search of the best options for individuals with bad credit, MoneyGeek reviewed four personal loan lenders in California that disclosed minimum credit score requirements between 580 and 640. Apart from the highlighted best and runner-up lenders, the California Credit Union, 1st United Credit Union and Credit Union of Southern California also offer localized services that borrowers might find suitable for their needs.

Best Bad CreditLendersCalifornia

2024

Best Bad Credit Loans in California

Best Overall - Happy Money

Runner-Up - Avant

MoneyGeek scored personal loan lenders in California that explicitly disclose their minimum credit score requirements on their websites to find the best personal loans for bad credit. Only 12% of lenders disclose this information.

We filtered our analysis to include lenders with minimum credit score requirements between 580 and 640, which meets Experian's definition of fair credit. Our research did not find any published minimums lower than 580.

Our analysis was completed in April 2024 and considers banks and lenders who are licensed to do business in California. We also consider financial companies that partner with federally insured institutions to offer competitive rates.

34Lenders Analyzed

Overall Best Bad Credit Loan Lender in California

Happy Money

94MoneyGeek Score
11.72% to 17.99%APR Range
640Minimum Credit Score
$5,000 to $40,000Loan Amount Range
24 to 60 monthsRepayment Terms

Happy Money is MoneyGeek's pick for the best personal loan lender for bad credit in California, with a MoneyGeek score of 94 out of 100. This fintech company collaborates with lending partners insured by the National Credit Union Administration (NCUA) to originate loans. It accommodates those with a minimum credit score of 640 and provides loans typically available the following day. For bad credit borrowers, this can mean access to funds ranging from $5,000 to $40,000 relatively fast. Happy Money doesn't impose late payment or early repayment charges and provides flexible repayment periods of 24 to 60 months. On the flip side, loans are solely for debt consolidation, and it does charge an origination fee.

Pros

Doesn't charge late, early repayment or bounced check fees
Flexible repayment terms
Lower maximum APR than competitors

Cons

Only offers loans for debt consolidation
Charges an origination fee
No co-signers or co-borrowers

Runner-Up for Best Bad Credit Loan Lender in California

Avant

92MoneyGeek Score
9.95% to 35.99%APR Range
580Minimum Credit Score
$2,000 to $35,000Loan Amount Range
12 to 60 monthsRepayment Terms

Avant is the runner-up for the best bad credit loan lender in California, with a MoneyGeek score of 92 out of 100. It works with WebBank — a state-chartered, member FDIC bank — to originate personal loans. This lender caters to borrowers with a minimum credit score of 580, provides a wide loan amount range from $2,000 to $35,000 and ensures swift next-day fund disbursal. Avant doesn't impose a prepayment penalty and offers a broad repayment period from 12 to 60 months. However, applicants should consider the administration fee (up to 9.99%) and the possibility of late payment fees.

Pros

Doesn't charge a prepayment penalty
Flexible repayment terms
Offers next-day funding

Cons

Charges an administration fee up to 9.99%
Has late fees and dishonored payment fees
Doesn't allow co-signers or joint applications

Calculate Your Monthly Loan Payment in California

The average new account balance for personal loans in California is $8,890, according to TransUnion's Credit Industry Snapshot. A personal loan, typically an unsecured loan, is repaid in fixed monthly payments over a set period until the total amount (including interest) is paid off.

Accurately calculating your monthly loan payments can be especially significant when you have a less-than-perfect credit history. To help estimate your costs before taking out a loan, consider using MoneyGeek's personal loan calculator.

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Updated: Dec 21, 2024

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Best Bad Credit Loans by Credit Score in California

The average credit score in California is 722, slightly above the Experian data-reported national average of 715.

Some lenders in California specialize in servicing borrowers with poor credit, though the tradeoffs may be higher interest rates and terms that are not as favorable. Use the table below to find available bad credit loan lenders in California based on your credit score.


Avant	580	9.95% to 35.99%	$2,000 to $35,000	12 to 60 months	Next Day	92
Prosper	600	8.99% to 35.99%	$2,000 to $50,000	24 to 60 months	1 business day	90
Achieve	620	8.99% to 35.99%	$5,000 to $50,000	24 to 60 months	Same Day	92
Happy Money	640	11.72% to 17.99%	$5,000 to $40,000	24 to 60 months	3 to 6 Business Days	94

What to Do if Your Loan Application Is Denied in California

Personal loan application denials are common, especially when your credit score is lower than average — but it doesn't have to halt your borrowing journey. Here's what you can do to enhance your chances of approval for future applications.

1
Find out the reason for the denial
If a lender denies your loan application, it could be due to several factors such as a low credit score, high debt-to-income ratio, insufficient income or errors in your application. Review the explanation given by the lender to pinpoint areas for improvement to mitigate the risk of future denials.
2
Modify your loan terms
After a denial, consider discussing with your lender the possibility of changing the loan amount or repayment terms. These adjustments could influence the lender's decision and potentially lead to approval.
3
Find another lender
Keep in mind that lender criteria for approving loans can vary. Seek out different lenders, evaluating each on certain elements to find the best match for your financial profile and needs. Here are factors to consider:
- Eligibility requirements: Credit score, income level, debt-to-income ratio and employment history differ across lenders. Knowing the requirements can guide you to a suitable one.
- Interest rates: Seek lenders with competitive interest rates to minimize borrowing costs, which is especially significant for those with lower credit scores.
- Additional fees: Origination, late and prepayment fees can add to your loan cost. Some lenders do not charge these fees, which could be beneficial.
- Loan terms: The loan repayment duration can impact your monthly payments and total interest. Both short and long terms have their advantages.
- Customer service and reputation: Research lenders for quality customer support and a solid reputation, as this affects your loan experience.
4
Look for alternatives
Alternatives to personal loans might be more suitable for individuals with bad credit. Exploring options such as credit-builder loans, secured loans or peer-to-peer lending could offer more favorable conditions or ease of approval.
5
Improve your credit score
Enhancing your creditworthiness is a methodical process that can increase your chances of personal loan approval in the future. Ways to start improving your credit score include making timely payments, reducing debt, and checking your credit reports for inaccuracies.

EXPERT TIP

Work on improving your credit score before applying for a personal loan to increase your chances of approval and getting better terms. Here are some long-term steps to consider:

Monitor your credit utilization ratio: Keep your credit utilization ratio low, as high credit utilization can negatively impact your credit score. Aim to use less than 30% of your available credit limit.
Don’t close old credit cards: The length of your credit history contributes to your credit score. Even if you no longer use a credit card, keep it open unless it has an annual fee.

—Alvin Yam, CFP

FAQ About Bad Credit Loans in California

It's common for borrowers to have questions or concerns about personal loans, especially if they have less-than-perfect credit. We compiled answers to frequently asked questions to assist in this process, offering clarity and guidance to help you make well-informed decisions.

What is the best personal loan lender for bad credit in California?

The best personal loan for bad credit in California is from Happy Money, with a MoneyGeek score of 94 out of 100

Which lender in California has the lowest interest rates for bad credit?

For personal loans in California, Achieve and Prosper both offer the lowest starting APR at 8.99%. Keep in mind that this rate is typically only available to applicants with excellent credit profiles.

Which lender in California has the lowest minimum credit score requirement?

The lender with the lowest minimum credit score requirement is Avant, requiring a score of 580.

How to apply for a personal loan for bad credit in California?

To apply for a personal loan with bad credit in California, start by checking your credit report to understand your financial situation. Look for lenders that cater to bad credit borrowers, including online lenders, local credit unions and banks. Evaluate loan offers by comparing interest rates, repayment terms and fees. Accurately complete the application process, whether online or in person, and provide any additional information the lender may request.

How long does it take to get a bad credit loan in California?

The time it takes to receive funds from a loan varies by lender. Some lenders offer same-day funding, while others could take anywhere from the next business day up to a week.

Can I pay off my personal loan early in California?

Yes, you can pay off your personal loan early in California. However, check with your lender regarding any prepayment penalties that may apply.

Is there a difference between personal loans and installment loans in California for bad credit?

In California, there's no notable difference between personal loans and installment loans for bad credit, as both involve borrowing a fixed amount and repaying it through regular, scheduled installments over a specified period.

Best Personal Loans

Best Bad Credit Loans

Sources

Experian. "What Is the Average Credit Score in the U.S.?." Accessed April 4, 2024.

TransUnion. "Credit Industry Snapshot." Accessed April 4, 2024.

About Zachary Romeo, CBCA

Zachary Romeo is a certified Commercial Banking and Credit Analyst (CBCA), and the Head of Loans and Banking at MoneyGeek. Previously, he led production teams for some of the largest online informational resources in higher education, with over 13 years of experience in editorial production.

Romeo has a bachelor's degree in biological engineering from Cornell University. He geeks out on minimizing personal debt and helping others do the same through people-first content.

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The content on this page is accurate as of the posting/last updated date; however, some of the rates mentioned may have changed. We recommend visiting the lender's website for the most up-to-date information available.

Editorial Disclosure: Opinions, reviews, analyses and recommendations are the author’s alone and have not been reviewed, endorsed or approved by any bank, lender or other entity. Learn more about our editorial policies and expert editorial team.