Bad Credit Personal Loans
Banks make personal loans sound easy - until you apply with less-than-perfect credit. Then it's rejection after rejection. At Your Lending Friend, we specialise in personal loans for people with bad credit. Our specialist lenders assess your application based on your current ability to repay, not just mistakes from your past.
Your past doesn't define your future. We've helped thousands of Australians with imperfect credit find personal loan options.
Personal Loans for Real People
Life happens. A relationship breakdown. Unexpected medical bills. A job loss. A business that didn't work out. Whatever caused your credit issues, you're not alone - and you're not out of options.
While major banks often reject anyone with bad credit automatically, specialist lenders take a different approach. They look at your current income, your living expenses, your employment stability - the full picture of who you are today, not just who you were when things went wrong.
At Your Lending Friend, we connect you with these specialist lenders. We know which ones suit different situations, and we'll work to find you the best possible option - no judgement, just solutions.
Who Can Apply?
We help people in challenging credit situations find personal loan options
Secured vs Unsecured Options
Understanding your options helps you choose the right loan type for your situation
| Feature | Secured | Unsecured |
|---|---|---|
| Collateral Required | Yes (car, term deposit, etc.) | No |
| Interest Rates | Generally lower (10-18%) | Generally higher (15-25%+) |
| Loan Amounts | Higher limits available | Usually capped lower |
| Approval Chance | Better for bad credit | Harder with bad credit |
| Risk | Asset can be seized on default | No asset at risk |
Not sure which is right for you? Talk to our team and we'll help you decide based on your specific situation.
How to Improve Your Approval Chances
Tips from our brokers who specialise in bad credit lending
Get a Copy of Your Credit Report
Know what lenders will see. Check for errors and understand your position. Free reports available from Equifax, Experian, and illion.
Pay Off Small Defaults If Possible
Paid defaults look better than unpaid ones. Even paying off one or two small amounts can make a difference.
Show Stable Employment
Lenders want to see you can afford repayments. At least 3 months in your current job is ideal, but we have options for new starters too.
Demonstrate Savings Ability
Even small regular savings show financial discipline. A consistent savings pattern strengthens your application.
Don't Apply Everywhere
Multiple loan applications hurt your credit score. Let us search on your behalf - one application to access 40+ lenders.
Be Upfront About Your History
We can't help if we don't know the full picture. Being honest allows us to find the right lender for your situation.
Rate Expectations
Bad credit loans have higher rates, but understanding what to expect helps you plan
| Credit Situation | Typical Rate Range |
|---|---|
| Good credit (700+) | 6% - 12% p.a. |
| Fair credit (500-700) | 12% - 16% p.a. |
| Poor credit / Paid defaults | 14% - 20% p.a. |
| Unpaid defaults / Recent bankruptcy | 18% - 28% p.a. |
The silver lining: A bad credit loan with consistent on-time repayments can help rebuild your credit. After 12-24 months, you may be able to refinance to a better rate.
*Rates are indicative only and depend on individual circumstances. We'll always show you the total cost before you commit.
What Can You Use a Bad Credit Personal Loan For?
Personal loans can be used for almost any purpose
Emergency Expenses
Car breakdown, medical bills, urgent home repairs - life doesn't wait for perfect credit. Get the funds you need when you need them.
Debt Consolidation
Combine multiple high-interest debts into one manageable repayment. Even at higher rates, it can still save you money.
Major Purchases
Furniture, appliances, electronics, or other significant purchases when you need them rather than when your credit is perfect.
Medical Procedures
Health shouldn't wait for credit repair. Finance medical procedures, dental work, or other health-related expenses.
Moving Costs
Bond, moving expenses, and setting up a new home. Cover the costs of a fresh start when you need to relocate.
Credit Building
A bad credit personal loan with consistent on-time repayments can actually help rebuild your credit score over time.
We Understand Life Doesn't Always Go to Plan
A default on your credit file doesn't make you a bad person. Financial difficulties can happen to anyone - illness, job loss, relationship breakdown, or just plain bad luck. We've helped thousands of Australians in tough situations find a way forward.
No judgement. Just solutions.
Bad Credit Personal Loans FAQs
Common questions about personal loans with bad credit
Bad credit typically means a credit score below 500-550, defaults on your credit file, court judgments, bankruptcy history, or Part IX debt agreements. Different lenders have different thresholds - what one considers poor credit, another might accept. That's why we compare 40+ lenders to find the right fit.
Yes, though your options will be more limited than with paid...
Yes, though your options will be more limited than with paid defaults. Some specialist lenders will consider applications with unpaid defaults, particularly if they're older (2+ years), the amounts are relatively small, or you're actively paying them down. Rates will be higher, but options exist.
Loan amounts typically range from $2,000 to $50,000 for bad ...
Loan amounts typically range from $2,000 to $50,000 for bad credit personal loans, depending on your income, the lender, and whether the loan is secured. Secured loans (using a car or other asset as collateral) can sometimes access higher amounts.
Yes, if you make consistent on-time repayments. Each on-time...
Yes, if you make consistent on-time repayments. Each on-time payment is recorded on your credit file, gradually improving your credit score. After 12-24 months of good repayment history, you may be able to refinance to a better rate as your credit improves.
Interest rates for bad credit personal loans typically range...
Interest rates for bad credit personal loans typically range from 14% to 28% p.a., depending on your specific situation. While higher than standard rates, this can still be cheaper than credit card interest (often 20%+) or payday loans. We always show you the total cost before you commit.
Secured loans (using a car, term deposit, or other asset as ...
Secured loans (using a car, term deposit, or other asset as collateral) typically offer lower rates and higher approval chances for bad credit applicants. However, your asset is at risk if you default. Unsecured loans have no collateral risk but may have higher rates and stricter requirements.
Most people can start exploring refinancing options after 12...
Most people can start exploring refinancing options after 12-24 months of consistent on-time repayments. During this time, your credit score should improve, making you eligible for better rates. We can help you refinance when the time is right.
If you're declined, we'll discuss the reasons and explore al...
If you're declined, we'll discuss the reasons and explore alternatives. Options might include a secured loan, a smaller loan amount, adding a co-borrower, or waiting until your situation improves. We're always honest about your options and won't push you into unsuitable products.
Still have questions? Contact our friendly team