Best Loans for Bad Credit in Alabama for 2024
Updated: April 25, 2024
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Happy Money, with a MoneyGeek score of 94 out of 100, is the best personal loan lender for bad credit in Alabama. It stands out for its outstanding customer service, competitive interest rates, credibility and transparency. As the runner-up, Avant is recognized for its broad payment options, quick application and approval process, and strong customer service, holding a MoneyGeek score of 92 out of 100.
MoneyGeek reviewed four personal loan lenders in Alabama that disclosed minimum credit score requirements, ranging from 580 to 640, to pinpoint the best personal loans for bad credit in the state. While these highlighted lenders are solid choices, Alabama Credit Union, Alabama Central Credit Union and MAX Credit Union also present other viable options for localized personal loan services in Alabama.
- 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 Alabama with a MoneyGeek score of 94 out of 100. It is a fintech company working with federally insured lending partners to originate personal loans. For borrowers with bad credit, it requires a minimum credit score of 640, offers a loan amount range of $5,000 to $40,000 and provides funds as soon as the next day. Happy Money directly pays creditors, simplifying debt consolidation and not levying multiple fees. Applicants should know it charges an origination fee and only offers loans for debt consolidation.
Pros
- Doesn't charge late, early repayment, bounced checks, failed ACH or other fees
- Flexible repayment terms from 24 to 60 months
- Offers to pay creditors directly
Cons
- Only offers loans for debt consolidation
- Charges an origination fee
- $40,000 borrowing limit
Overall Best Bad Credit Loan Lender in Alabama
- 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 Alabama with a MoneyGeek score of 92 out of 100. It collaborates with WebBank — a state-chartered FDIC member bank — to originate personal loans. An accessible minimum credit score of 580, loan amounts from $2,000 to $35,000 and the possibility of next-day fund receipt make Avant a considerable option. Its flexibility in repayment terms and the ability to check loan options without impacting credit scores stand out. However, applicants should note the administration fee of up to 9.99% and the potential for late and dishonored payment fees.
Pros
- Doesn't charge a prepayment penalty
- Flexible repayment terms between 12 to 60 months
- Offers next-day funding
Cons
- Charges an administration fee up to 9.99%
- Low borrowing limits at $35,000
- Doesn't allow co-signers or joint applications
Runner-Up for Best Bad Credit Loan Lender in Alabama
Calculate Your Monthly Loan Payment in Alabama
In a recent Credit Industry Snapshot report by TransUnion, the average new account balance for personal loans in Alabama stands at $4,722. When you take out a personal loan, you agree to pay back the principal amount and interest over a specified period, typically in monthly installments. Understanding your monthly payments is crucial to managing your finances effectively if you have a less-than-perfect credit history.
To accurately estimate your loan payments, consider using MoneyGeek's personal loan calculator. This tool can help you plan your budget by clearly showing your monthly financial obligations.
Best Bad Credit Loans by Credit Score in Alabama
With an average credit score of 692, Alabama's average is below the national average of 715 based on Experian data.
Some lenders in Alabama consider applicants with low credit scores but typically charge higher interest rates and offer less advantageous terms. The table below shows which personal loan lenders are accessible in Alabama based on your credit score.
What to Do if Your Loan Application Is Denied in Alabama
It's not uncommon to face a personal loan application denial in Alabama, but this doesn't halt your borrowing journey. Here are some measures to enhance your chances for approval on future applications.
Find out the reason for the denial
If you are denied a personal loan, it could be due to a poor credit score, a high debt-to-income ratio, insufficient income or mistakes in your application. Review the reasons provided by the lender to address your areas of weakness and reduce the likelihood of future denials.
Modify your loan terms
Consider speaking to your lender about changing the loan amount or repayment terms to improve the chances of approval for your personal loan.
Find another lender
Lenders have distinct criteria for loan approval. Compare lenders and evaluate key factors to choose one that aligns with your needs and credit profile.
- Eligibility requirements: Verify each lender's criteria for credit scores, income levels, debt-to-income ratios and employment history.
- Interest rates: Search for lenders offering competitive interest rates, which is beneficial for applicants with less than perfect credit.
- Additional fees: Consider lenders' origination, late payment, and prepayment fees. Avoiding these can be advantageous, especially for those with lower credit scores.
- Loan terms: Assess the various repayment periods lenders provide for personal loans, considering the impact of short- and long-term agreements.
- Customer service and reputation: Research lenders to understand their customer service quality and overall reputation before deciding.
Look for alternatives
If personal loans are not currently available to you due to a low credit score, explore other options such as credit builder loans, secured loans or credit union loans that may accommodate borrowers with bad credit.
Improve your credit score
Working towards improving your credit score can ultimately enhance your eligibility for a personal loan. Strategies include making on-time payments, reducing debt and regularly checking your credit report for errors.
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 Alabama
When shopping for personal loans in Alabama, it's common for borrowers, especially those with bad credit, to have questions or concerns. To assist in this process, we compiled answers to some frequently asked questions, offering clarity and guidance to help you make well-informed decisions.
Happy Money is recognized as the best personal loan lender for bad credit in Alabama with a MoneyGeek score of 94 out of 100.
Avant has the lowest minimum credit score requirement in Alabama, which is 580.
The time to receive funds from a bad credit loan in Alabama depends on the lender. Some lenders can provide funds as quickly as the same day, while others may take from the next business day up to a week.
Yes, you can pay off your personal loan early in Alabama. It is important to check with your lender about any potential prepayment penalties.
sources
- Experian. "What Is the Average Credit Score in the U.S.?." Accessed April 11, 2024.
- TransUnion. "Credit Industry Snapshot." Accessed April 11, 2024.
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.
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