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Loans for bad credit

These reliable lenders can offer you a competitive bad credit loan solution that you’ll love.

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loans for bad credit
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Australia’s leading bad credit lenders, ready to approve your loan application

When you have a bad credit record, banks and traditional lenders may reject your loan application.

The best way to navigate around this hurdle is to find a bad credit lender that deals specifically with people that have a tainted credit history.

Frequently Asked Questions

Tailored loans for bad credit

You're still able to get loan approval, despite having a bad credit score. Some lenders have a tailored application process, especially for customers with bad credit. These loans carry a fixed loan term and a once-off loan amount which is then repaid in instalments to a lender with interest and fees.

What is bad credit?

Bad credit is considered to be a credit score of 509 and below and seriously affects your ability to obtain credit.

You can get bad credit history from defaulting on loans or making your payments late, filing for bankruptcy, from writs and summons and from making multiple credit applications within a short space of time.

All these factors are then recorded on your credit file with the major credit reporting agencies in Australia, namely Equifax, Experian and Dun and Bradstreet.

A closer look at loans for bad credit

A bad credit loan is a type of loan offered to people with poor credit history who are unable to obtain traditional loans from banks or other financial institutions. These loans come with higher interest rates and stricter terms and conditions compared to regular loans because they're considered high-risk for lenders.

Loans for bad credit can be secured or unsecured depending on the lender's requirements and your ability to provide collateral. Secured loans require you to put up assets such as property or cars as collateral, while unsecured loans do not require any collateral but may come with higher interest rates.

The main advantage of bad credit loans is that they do not rely solely on your credit score to determine your eligibility for a loan. Instead, lenders offering bad credit loans will consider a range of factors when assessing your application.

This may include factors such as your income, employment status, and overall financial situation. In essence, bad credit loans allow you to borrow money even if you have struggled to get approved for traditional forms of financing due to your low or damaged credit score.

Repairing a bad credit score

The majority of your credit history will remain on your credit file for 5 years, however, bankruptcy and debt agreements will also be listed on the National Personal Insolvency Index (NPII).  

In order to repair your bad credit, you will need to ensure that you keep up any and all repayments and ensure you do not take on any more credit to ensure that you can afford to pay off your debt.

If you are struggling to afford loans and credit repayments you should immediately contact your credit providers and negotiate a more manageable repayment plan.

It is also a good idea to obtain a copy of your credit file so that you can verify that all the details contained therein are accurate and that you stay clear of fraud.

What are my options if I have a bad credit record?

Having bad credit does limit your options as to where you can get credit as well as the type of credit that you can get but, it does not mean that you cannot access credit at all.

There are many lenders who specialize in offering loans for bad credit and even some who offer low-doc loans to self-employed individuals and those who do not meet the typical criteria for a loan.

Even with bad credit, you can still apply for short-term loans, personal loans, vehicle loans and even a home loan. Although you can still access these credit products you will have to pay a higher interest rate and will many times have to offer some form of security.

Types of bad credit loans available in Australia

There are various types of bad credit loans available in Australia that cater to different needs and circumstances. One popular type is the payday loan, which is a short-term loan designed to be repaid in full when you receive your next paycheck.

Another option is the personal loan, which can be used for a wider range of purposes such as debt consolidation or home improvements. Other types of bad credit loans include secured loans, which require collateral like a car or property; guarantor loans, where someone else agrees to guarantee the loan repayments; and peer-to-peer lending platforms that bring together borrowers and investors.

It’s important to note that each type of bad credit loan has its own specific terms and conditions regarding interest rates, repayment periods, fees and charges. It’s important to carefully compare different options before deciding on the right one for you.

What can a bad credit loan be used for?

Bad credit loans can be used for virtually anything that a normal personal loan can be however, due to the higher rates typically charged on these kinds of loans there are certain applications for which it is not advisable to use them.

These include debt consolidation loans, helping you to better manage your money and get out of debt.

Affordability vs credit score

A bad credit lender will choose to take your ability to afford repayments into consideration as opposed to your credit score alone. This means that although a low credit score will not stop them from offering you a loan, overindebtedness and an inability to afford repayments will.

Top loan finding tips

  • Always use a loan comparison website to find the best bad credit deals
  • Use a loan’s comparison rate and never just the advertised interest rate
  • Always ensure the bad credit lender is registered and abides by the rules and regulations as laid out by the ASIC
  • Check to ensure that you are not being charged more than the government capped rates and interest fees

Comparing loans for bad credit

Even with bad credit, it is important to always consider a wide variety of options to ensure that you get a decent price and do not pay excessive rates and fees that are simply unnecessary.

When it comes to small loans of up to $2,001 the fees and rates that any lender can charge is capped at 20% of the principal and an ongoing 4% monthly fee.

When it comes to medium loans of between $2,001 and $5,000 the maximum APR (Annual Percentage Rate) that a lender can charge is 48%. This means that taking out a bad credit loan or a payday loan has now become a lot safer.

That being said, these types of loans can still cause havoc with your finances since they are more expensive than other forms of credit and roll-overs and non-payment fees can certainly stack up.

The best way to compare any kind of loan is to use a loan comparison website since this will allow you to compare specific features side by side while viewing only direct lenders that offer a reliable service.

Documents required when applying for credit:

  • 100 points ID, a Medicare card or your driver’s license
  • 90 days bank statements

Typically you can apply for a loan by providing just the documents listed above however, for larger personal loans for bad credit or debt consolidation loans you will have to provide a range of additional documentation to support your application.

FAQs about loans for bad credit

What is the maximum amount I can borrow with a bad credit loan?

The maximum amount you can borrow with a bad credit loan will vary depending on your lender, but it's generally lower than what you would qualify for with good or excellent credit. Most lenders will only lend up to $5,000 or $10,000 for borrowers with poor or fair credit scores.

How long does it take to get approved for a bad credit loan?

The time it takes to get approved for a bad credit loan also varies depending on the lender. Some lenders offer instant approval online, while others may take several business days or more. It's important to research different lenders and compare their approval times before applying.

What interest rates should I expect with a bad credit loan?

The interest rates on bad credit loans are typically higher than those on traditional loans because they pose more risk for lenders. Depending on your lender and your specific situation, you could be looking at interest rates anywhere from 15% to 50% or higher. It's important to read the terms and conditions of any loan offer carefully and make sure you understand the interest rates and fees before accepting.

Alternatives to bad credit loans

  • Borrowing from family or friends – is likely to be your best option, if you can borrow some money from family or friends you will be able to save a lot in interest considering the fact that bad credit loans are so expensive.
  • Borrow from work – if you need a small loan and want to apply with a bad credit lender, why not consider asking your employer for an advance on your next paycheck? This will be a lot cheaper and a lot easier than taking out a loan.
  • Sell items you no longer need – if you have a bicycle in your garage or boxes and boxes of unused items in your garage why not sell some of these items to get some fast cash rather than taking out a loan? Not only do you get to de-clutter and free up space but you get to get some money as well!
  • Credit unions – focus on providing financial services to local communities or groups of individuals who share common interests or characteristics. They often offer lower interest rates than traditional banks because they are not-for-profit organizations. Credit unions can also help people with poor credit histories rebuild their financial situation by offering education and guidance on how to manage finances effectively.
  • Pawn Brokers – if you have an item of value that you can pawn for a quick cash advance this is also an option but, you should be careful since pawnbrokers charge very high fees and rates and if you do not make your loan repayment your item will be sold and therefore lost.

While bad credit can limit your options when it comes to borrowing money, there are still plenty of loans for bad credit available if you need financial assistance.

By taking the time to research different lenders and loan products available on the market today, including non-traditional lenders like peer-to-peer lenders or crowdfunding platforms which may be more flexible than traditional banks or finance companies - you’ll find something that suits your needs without risking further damage on your already battered credit score.

Bad credit loan calculator

The interest rate of a loan will vary based on your credit score and risk profile.
This bad credit loan calculator is for illustration purposes only.
The use of this loan calculator is subject to our terms of use.

List of direct lenders offering Loans bad credit

  1. Cigno Bad credit loan


    • Loans up to $1,000
    • Flexible loan repayment
    • Low interest rates
  2. Credit24 Loans Bad credit loan

    Credit24 Loans

    • Loans up to $10,000
    • Term up to 36 months
    • Interest up to 48%
  3. Jacaranda Finance Bad credit loan

    Jacaranda Finan...

    • Loans up to $15,000
    • Term up to 24 months
    • Interest up to 48%
  4. Fair Go Finance Bad credit loan

    Fair Go Finance

    • Loans up to $10,000
    • Term up to 12 months
    • Interest from 29.9%
  5. Swoosh Finance Bad credit loan

    Swoosh Finance

    • Loans up to $5,000
    • Term up to 24 months
    • Interest from 66%
  6. Good To Go Loans Bad credit loan

    Good To Go Loan...

    • Loans up to $5,000
    • Term up to 24 months
    • Interest from 32%
  7. Cash On Your Mobile Bad credit loan

    Cash On Your Mo...

    • Loans up to $5,000
    • Term up to 12 months
    • Interest from 24%
  8. My OzMoney Bad credit loan

    My OzMoney

    • Loans up to $10,000
    • Term up to 3 years
    • Interest from 24%
  9. Club Money Bad credit loan

    Club Money

    • Loans up to $1,500
    • Term up to 180 days
    • Interest from 25%