Unsecured Personal Loans: Bad Credit, Direct Lenders

Having bad credit can limit your financial prospects, especially when you have big plans for your future and little to no money to start with.

The natural way of things would be to get a loan, but since most lenders require a good credit score from all applicants, you’d find your chances of getting a proper loan dim. This is when you should think about loans from a different lens.

As indicated by our tests, some lenders design personal loans to fit people who have bad credit scores. However, when it comes to unsecured loans or loans with low interest rates, finding unsecured personal loans, bad credit, direct lenders will prove challenging but not impossible. Continue reading to know more.

Unsecured Personal Loans: Bad Credit, Direct Lenders – Where to Find Them

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The truth is you might have to dig a little bit deeper into lenders’ websites to find a loan that fits that description. It might be possible to find personal loans for people with bad credit, but that would come at the expense of the interest rate, which will be staggeringly high.

Similarly, it’ll be exceedingly difficult to find an unsecured personal loan for people with bad credit.

Our team discovered through using this product that, some lenders might consider people with bad credit, but they’d still have to go through a credit check and qualify for other loan requirements before getting approved. While there might be a chance for you to get approved, your chances of getting approved will fall due to your bad credit history.

In short, you have to scour the internet with a lender that offers this type of personal loan for people with bad credit. If you can’t or don’t get approved, you’ll need to either reduce the loan you’re applying for or try a different lender.

Personal Loans

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If you’re new to unsecured loans bad credit instant decision Australia, they’re loans provided by financial institutions and lenders to borrowers who fit certain criteria, like not having a credit score below a preset one.

Once a borrower is approved, they’re asked to repay the debt with a specific interest rate over a repayment period. Some lenders might ask for a personal belonging or asset to secure the loan as collateral, too. However, not all borrowers prefer that. If you’re one of them, be sure that your loan is unsecured.

As you can see, personal loans are less risky than other types of loans. Still, they can have a high interest rate, and most lenders will do a credit background check before they approve your application, so try to increase your credit score a bit if possible before applying.


In many cases, personal loan providers might not approve of your application, which means that you’ll have to consider other alternatives. Here are two of them:

Bad Credit Loan

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These loans, also known as payday loans, are considered a type of personal loan, only smaller, subject to a direct lender’s approval, such as a bank or other financial institutions.

Our findings show that, these loans are more accessible to people with bad credit, which is why you’ll find many people with bad credit opting for them instead of seeking personal loans first.

Unfortunately, though, these loans carry a high degree of risk, not to mention the incredibly high interest rate you’ll have applied to your loan. That’s why financial gurus advise against opting for bad credit or payday loans.

No Interest Loan Scheme (NILS)

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The Good Shepherd Australia and National Australia Bank (NAB) collaborated to create the NILS program. This program allows you to request a loan of up to $1,500 without having to go through a credit check. However, how you spend that money is limited to a set of areas.

For instance, the money you borrow through this program should only be spent on essentials like car repairs, educational material, household appliances, medical care services, and so on.

While there’s no credit check or interest on NILS loans, you’ll still have to make sure that you’re eligible for that type of loan. Here are some of the eligibility criteria you must fulfil:

  • Have a Pensioner Concession Card or Health Care Card
  • Provide evidence on the financial means by which you’ll pay your debt
  • Prove that you’ve lived in your current location for more than three months

How to Increase Your Credit Score

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Whether or not you got the loan that you need, it’s worth mentioning that you need to increase your credit score anyway, as that’ll make managing your finances in the future a much easier task.

For starters, be sure to pay your current instalments on time. Personal loan providers allow borrowers to pay extra instalments to reduce their debt and, thus, reduce the amount of money they pay in the future.

You must also use only a credit card that you’re sure you’ll be able to manage. Finally, pay your bills on time, especially those that go over $150.

Final Thoughts

With that said, you should now have a better grasp of what to look for and whether or not you should apply for unsecured loans with a bad credit score. Finances and loans can be slightly tricky, so make sure that you tread these uncharted waters carefully before making any rash decisions.

About the Author

Lucy has over a decade of experience in finance. She is currently the content curator here at Perfect Payday.

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