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Personal Loans

Best Hardship Personal Loans

Hardship personal loans are designed to help individuals get through a tough financial period. In some cases, you may need a cash infusion if you’ve lost income. When you don’t have any earnings coming in, smaller banks and credit unions may have financing options available even without employment.

But in other cases, your hardship may entail a financial emergency even when you have income. And if you have bad credit, qualifying for a traditional personal loan may be difficult. However, some lenders specialize in working with borrowers who have bad credit and are facing financial hardship.

Learn more about lenders that offer hardship personal loans and what to expect during the application process. You’ll also find tips on how to choose the best lender and alternatives to consider before you take out a loan.

Best hardship personal loans 

Navigating financial hardship can be a momentous task, and securing a loan during such stress-ridden periods may feel daunting. 

Aside from comparing interest rates, be mindful of customer support, loan conditions, and approval rates. To aid you on your journey, we’ve compiled a list of top-tier lending companies that offer personal loans tailored to individuals experiencing financial hardships.

LenderMin. credit scoreRates (APR)
CredibleNot disclosed7.49%35.99%
Upstart3007.80% – 35.99%

Credible – Best marketplace 

LendEDU rating: 5.0 out of 5

  • Robust marketplace that links borrowers with multiple lenders 
  • Convenient, fast, and secure loan application process 
  • Clear and easy-to-understand loan terms 

Credible is a top marketplace for hardship personal loans. It’s designed to link borrowers with multiple lenders, offering a comprehensive selection of loan options. Its secure platform ensures user data stays confidential at all times. 

Credible clients appreciate the simplicity and transparency of its loan terms. Users can conveniently review the terms and make informed decisions. Credible might be your go-to marketplace if you value a vast array of options coupled with a user-friendly platform.


LendEDU rating: 4.8 out of 5

  • Extensive network of lenders offering a variety of loans 
  • Tailored loan offers based on user profile
  • User-friendly dashboards and mobile app 

LendingTree impresses us with its varied loan options. It connects users to a wide array of lenders, ensuring you always have comprehensive offers to compare. 

It offers personalized loan recommendations based on individual profiles, making it easier to find offers suited to your circumstances. It also strikes a balance between function and design with its intuitive dashboards and mobile app, making loan management simple and efficient.

Upgrade – Best for fair credit 

LendEDU rating: 4.9 out of 5

  • Offers loans to applicants with a fair credit score
  • Features quick approval and funding procedures
  • Tools for credit health monitoring 

Upgrade defies the norm by offering loans to applicants with moderate credit ratings—a genuine lifeline during a financial crisis. 

Its quick approval and funding process can provide immediate relief during a cash crunch, and its credit health monitoring tools enable borrowers to shape their financial future positively.

Upstart – Best for thin (little to no) credit 

LendEDU rating: 4.8 out of 5

  • Offers loans even with thin or no credit history 
  • Uses artificial intelligence in approval processes 
  • Online educational resources for better financial management 

Upstart is a standout for those with little to no credit history. It’s common to have a thin credit file during financial hardship, but Upstart doesn’t let this deter potential borrowers. 

Its use of artificial intelligence in the loan approval process ensures fair judgments. An added perk of Upstart is its online educational resources, arming borrowers with the knowledge to manage their finances in the future.

Should you get a hardship personal loan?

Explore when it might make sense to get a hardship personal loan and when you might want to consider other alternatives instead. 

ScenarioConsider a hardship loan?
You have enough money in your budget to cover monthly payments
The loan interest rate and fees are cheaper than a credit card
You know how much you want to borrow and why
The lender charges a high origination fee 
You’re worried about making monthly payments on time
You don’t have an exact plan for the loan funds

Make sure you can comfortably afford any hardship personal loan payments, or you risk accruing late fees and hurting your credit score. Having a clear plan for your funds is also essential instead of borrowing the maximum amount you’re offered. Otherwise, you may end up spending on non-emergencies and paying significant interest. 

A hardship loan may not be suitable if the lender charges hefty origination fees. These are usually deducted from the loan amount before you receive the funds—so you don’t get as much cash as you expected. 

Also, compare interest rates to other financing options you have, such as credit cards. When you have bad credit, your loan rate could be pretty high. But you might prefer having fixed interest and monthly payments, so you know exactly how much you’ll pay and when. 


Start an emergency fund by opening a savings account at a bank or credit union. Set an initial goal of $500—that extra cash can come in handy the next time you have a surprise expense or loss of income. 

Costs of a hardship personal loan 

When comparing hardship personal loans, there’s more to consider than just the monthly payment. 

Interest rates and APR

The interest rate is the amount you’re charged on your loan balance each year. But most lenders won’t quote you the interest rate—they show you the annual percentage rate (APR).

The APR factors in the cost of other fees charged by the lender, such as an origination fee. The total cost is significant to consider if you’re looking for a hardship personal loan with bad credit because interest and fees can be much higher.

A person with excellent credit may qualify for a 12% APR on a loan, while someone with poor credit might get the same loan with a 30% APR. On a $5,000 loan with a three-year term, the first borrower would pay $166 a month while the second borrower would pay $212.

Credit score and future financing

Taking out any type of loan affects your credit score. Initially, you’ll see a minor drop when you apply for a loan. But overall, a fixed loan doesn’t influence your score as much as revolving credit (like a credit card).

You’ll improve your credit score by making your payments on time and in full each month. But you can hurt your score if you make a payment that is 30 days late or more. 

Cost-saving tips

Consider these strategies to save money on a hardship personal loan.

  • Choose a shorter term: While your monthly payments might be a little higher compared to stretching out your loan, you’ll pay less interest over time. 
  • Pay off your balance early: If you overcome your hardship (such as replacing lost income), pay off your loan early to avoid interest. 
  • Apply with a cosigner: You could qualify for better terms if you get a cosigner who has a higher credit score or income that can count toward eligibility requirements. Just remember all loan activity (good or bad) affects their credit as well. 

How to choose the best hardship personal loan 

Follow these steps to compare hardship personal loan offers and get the best deal possible: 

  • Look at eligibility requirements: Most lenders list basic eligibility requirements, such as credit score and a minimum required income. Start with lenders that match your financial profile.
  • Check lender reputation: Look at online third-party reviews from real-life borrowers and check for complaints on the Better Business Bureau website. Avoid predatory lenders that have exorbitant fees, high-pressure sales techniques, or upfront fees that come out of your pocket. 
  • Get quotes: Next, see if you’re preapproved by getting a quote. Prioritize lenders that only perform a soft credit check so your score isn’t affected until you formally apply.
  • Compare offers: Look for factors such as the loan amount, interest rate and APR, fees, and monthly payments. 
  • Consider loan funding time: Depending on your financial needs, you may choose a hardship lender that delivers quick funds. Many online lenders can transfer funds within a day or two, while traditional banks may take a week or more. 

Once you gather all this information, you can use your best judgment to pick the best hardship personal loan. Cost, service, and convenience all play a role. Ultimately, you should feel comfortable with the affordability of your monthly payments. 

How to apply for a personal loan 

When you’re ready to apply for a hardship personal loan, expect to take the following steps with your lender of choice. 

  1. Submit a formal application: Once you review your loan quote, it’s time to apply by submitting your personal and financial details. You’ll need your Social Security number, employment information, and loan amount request. 
  2. Gather documentation: This varies depending on the lender. You may need to submit copies of your bank statements, pay stubs, or tax returns. 
  3. Receive an approval decision: Many lenders with an online application will give you a financing decision almost immediately. 
  4. Review the details of your loan offer: Read your loan agreement carefully. You aren’t required to sign it if you change your mind or are unsure about the terms. If you have questions, call the lender and ask. Your loan offer should come with an expiration date, so you know how long you have to consider. 
  5. Get funding: If you decide to move forward and sign the loan agreement, the lender will disburse your funds. The timeline varies by lender and could be the same day or in a week or two. 

Alternatives to a hardship loan

Explore alternatives before taking out a hardship personal loan. You might have less expensive options.

Special programs for veterans, disabled individuals, and other groups

Certain groups may have access to special programs offering cheaper loans or subsidies. For instance, veterans can access VA financial assistance, and disabled individuals might qualify for specific hardship grants.

Free or low-cost financial counseling

Consider using financial counseling before resorting to a hardship loan. Understanding your financial situation better through professional advice can lead to better decisions and prevent future financial distress.

Credit cards

A credit card might be a feasible alternative for more minor, short-term financial needs. Interest rates can be high, but initial promotional periods can offer low to zero interest. However, a failure to repay can lead to increased debt and damaged credit.

Home equity loan or HELOC

With lower interest rates than hardship loans, a home equity loan or home equity line of credit (HELOC) allows homeowners to borrow against their home’s value. However, the risk of foreclosure is a significant drawback because the home serves as collateral.

Retirement plan

Borrowing from your retirement plan has benefits, such as low interest rates and convenience. But the cons, including penalties and reduced retirement savings, make it a less attractive option.


How can I prevent needing a hardship loan in the future?

The best ways to avert a future need for a hardship loan include building an emergency savings fund, lowering monthly expenses, creating a budget, and maintaining good credit. Always consider insurance options for covering unexpected events, such as health emergencies or job losses.

How can I tell if a hardship personal loan is a scam?

Warning signs of scam loans could include upfront payment demands, guarantees without credit checks, or requesting unconventional forms of payment. Respected lenders are registered and comply with the financial regulations of their state.

How can I manage a hardship personal loan to avoid further financial distress?

On-time repayment and a clear understanding of the loan terms are crucial. Using a loan repayment calculator can help plan your budget. Seek professional financial advice if necessary, and always communicate with your lender when encountering repayment issues.

Recap: Best hardship personal loans

LenderMin. credit scoreRates (APR)
CredibleNot disclosed7.49%35.99%
Upstart3007.80% – 35.99%