A credit score of 580 places you in the “fair” credit category, which can make securing a personal loan more challenging—but not impossible. While you won’t qualify for the best rates available, several legitimate lenders specialize in working with borrowers who have less-than-perfect credit.
Understanding your options and preparing your application strategically can help you secure the funding you need without falling into predatory lending traps. This guide breaks down everything you need to know about getting a personal loan with a 580 credit score, including the best lenders, rates to expect, and steps to improve your approval odds.
What Does a 580 Credit Score Mean for Personal Loans?
A 580 credit score falls into the “fair” credit range (580-669) according to FICO scoring models. This means you’ve likely had some credit challenges in the past—perhaps late payments, high credit utilization, or even a bankruptcy or foreclosure.
From a lender’s perspective, a 580 score indicates higher risk. You’re statistically more likely to miss payments or default compared to borrowers with higher scores. This increased risk translates to:
- Higher interest rates (often 18-36% APR)
- Stricter approval requirements
- Lower maximum loan amounts
- Additional fees like origination charges
- Shorter repayment terms
However, many lenders recognize that credit scores don’t tell the whole story. Factors like steady employment, adequate income, and low debt-to-income ratios can help offset a lower credit score.
Best Personal Loan Lenders for 580 Credit Scores
Upstart: Best for Credit-Building Borrowers
Upstart stands out for its AI-driven underwriting process that considers factors beyond your credit score, including education and employment history.
The lender accepts borrowers with credit scores as low as 300 and even those with no credit history at all.
Key features:
- Loan amounts: $1,000 to $50,000
- Terms: 36 to 60 months
- APR range: 7.8% to 35.99%
- Origination fee: 0% to 12%
Best for: Recent graduates or career changers who may have limited credit history but strong earning potential.
OneMain Financial: Best for Secured Loans
OneMain Financial offers both secured and unsecured personal loans, with secured options typically offering better rates for borrowers with fair credit. You can use a vehicle or other asset as collateral to potentially lower your interest rate.
Key features:
- Loan amounts: $1,500 to $20,000
- Terms: 24 to 60 months
- APR range: 18.00% to 35.99%
- Origination fee: $25 to $500 or 1% to 10%
Best for: Borrowers who own a vehicle or other valuable asset they can use as collateral.
Avant: Best for Quick Funding
Avant specializes in lending to borrowers with fair credit and offers fast funding—often as soon as the next business day after approval. The lender also provides a 10-day grace period for late payments.
Key features:
- Loan amounts: $2,000 to $35,000
- Terms: 24 to 60 months
- APR range: 9.95% to 35.99%
- Origination fee: Up to 9.99%
Best for: Borrowers who need money quickly for emergencies or time-sensitive expenses.
What Interest Rates Should You Expect?
With a 580 credit score, expect personal loan APRs between 18% and 36%. The exact rate you receive depends on several factors:
- Income and employment stability
- Debt-to-income ratio
- Loan amount and term
- Whether you secure the loan with collateral
- The specific lender’s risk assessment
While these rates are higher than what excellent credit borrowers receive (often 6-15% APR), they’re still significantly better than alternatives like payday loans, which can carry triple-digit interest rates.
How to Improve Your Approval Odds
Review Your Credit Reports
Before applying, obtain free credit reports from all three bureaus through AnnualCreditReport.com. Look for errors like:
- Incorrect payment histories
- Accounts that don’t belong to you
- Wrong account balances
- Outdated negative information
Dispute any errors you find, as removing them could boost your score by several points.
Calculate Your Debt-to-Income Ratio
Lenders typically prefer debt-to-income ratios below 36%, though some accept ratios up to 50%. Calculate yours by dividing your monthly debt payments by your gross monthly income. If your ratio is high, consider paying down existing debt before applying.
Consider a Co-signer or Secured Loan
Adding a creditworthy co-signer can significantly improve your approval odds and potentially lower your interest rate. Alternatively, securing the loan with collateral (like a car or savings account) reduces the lender’s risk.
Apply with Multiple Lenders
Different lenders have varying risk tolerances and underwriting criteria. What one lender denies, another might approve. Use prequalification tools when available to compare offers without hard credit inquiries.
Red Flags to Avoid
Predatory Lenders
Steer clear of lenders that:
- Guarantee approval regardless of credit
- Don’t check your credit at all
- Charge excessive fees upfront
- Pressure you to decide immediately
- Operate without proper licensing
Payday and Title Loans
These short-term, high-cost loans might seem appealing when you need cash quickly, but they often trap borrowers in cycles of debt with APRs exceeding 400%.
Alternative Borrowing Options
Credit Union Personal Loans
Credit unions often offer more flexible lending criteria and lower rates than traditional banks. Many have programs specifically designed for members with fair credit.
Peer-to-Peer Lending
Platforms like LendingClub and Prosper connect borrowers directly with individual investors, sometimes offering better rates for borrowers with fair credit.
Family and Friends
Consider asking trusted family members or friends for a personal loan. Just be sure to document the terms clearly to avoid relationship strain.
Building Credit for Future Loans
While securing a loan now is important, also focus on improving your credit score for better options in the future:
- Make all payments on time (including your new personal loan)
- Keep credit card balances low
- Don’t close old credit accounts
- Limit new credit applications
- Consider a secured credit card if you need to rebuild credit
Smart Borrowing Strategies
Only Borrow What You Need
Higher loan amounts mean higher monthly payments and more total interest paid. Calculate exactly how much you need and avoid borrowing extra “just in case.”
Choose the Shortest Term You Can Afford
While longer terms mean lower monthly payments, they also mean paying significantly more interest over time. Choose the shortest repayment term your budget allows.
Read the Fine Print
Before signing, carefully review:
- The total cost of the loan
- All fees and penalties
- Prepayment policies
- Default consequences
Ready to Take the Next Step?
Having a 580 credit score doesn’t disqualify you from getting a personal loan, but it does require more careful shopping and preparation. Focus on lenders that specialize in fair credit borrowers, compare multiple offers, and consider ways to strengthen your application.
Remember that this loan is also an opportunity to improve your credit score. By making all payments on time and managing the debt responsibly, you’ll be in a much stronger position when you need credit in the future.
Before applying anywhere, use prequalification tools to see what rates you might qualify for without impacting your credit score. This allows you to shop around and find the best deal available for your situation.