Last week, personal loan rates fell. This means that if you are looking for a personal loan, whether to finance a project or a major purchase, you can benefit from a relatively low interest rate, as long as you are a qualified borrower.

For borrowers with a credit score of 720 or higher who prequalified on Credible.com’s personal loan marketplace, the average interest rate on a three-year personal loan was 10.42% from January 31 through February 4. According to Credible.com, that’s a rate of 0.60. % decrease compared to the previous week. The average five-year personal loan rate fell 0.86% last week to 12.62% from 13.48%.

The most qualified borrowers generally benefit from the best rates. In fact, qualified borrowers can benefit from a rate that is significantly lower than the average. The rate you receive depends on a variety of factors, including your creditworthiness and the loans available from your chosen lender.

Related: Best Personal Loans

How to Compare Personal Loan Rates

If you want to get the best rate, be sure to research lenders that offer a prequalification process for personal loans. While many lenders post their rates online, this only gives you a range of what they offer, not an exact rate based on the qualifications you meet. However, when you prequalify for a personal loan, a lender will perform a soft credit check to prescreen you, which has no impact on your credit score.

After your prequalification, the lender can provide you with an overview of your loan options. This snapshot typically includes loan rates, terms, and limits. To find the best loan for your situation, consider prequalifying with several lenders and comparing terms.

Prequalification does not imply loan approval. You will still need to submit a formal application and additional documents to get the loan you want. Typically, lenders do a thorough credit check when you formally apply for a loan. Credit checks can lower your score by one to five points.

Related: 5 personal loan requirements to know before applying

How to calculate your personal loan payments

Once you have an idea of ​​your personal loan interest rate, you can calculate your monthly payments. You will need to enter the interest rate, amount and term of your loan. This will help you determine how much you will owe monthly and how much interest you will pay over the life of your loan.

For example, suppose you get a $5,000 personal loan with a term of five years at a fixed interest rate of 12.62%. You’d pay about $113 a month and about $1,768 in interest over the life of the loan, according to Forbes Advisor’s Personal Loan Calculator. Overall, you would pay $6,768 in total, which includes both principal and interest.

Personal loan rate by credit score

The rates below are estimated average interest rates for personal loans based on VantageScore risk levels, according to Experian. Although the rates below can serve as a general guideline, note that interest rates are ultimately set and determined by the lenders.

How to get the best rates

Your credit is an important factor in the rates you receive. According to Rod Griffin, senior director of education and consumer advocacy at Experian, “checking your credit report and scores three to six months before applying for a personal loan” is a good idea. This gives you enough time to make the necessary corrections.

A credit score of 720 or better will generally get you the best deal. If you’re not quite in this credit score range, consider taking steps to improve your credit score. Pay off your existing debts to reduce your credit utilization ratio, remove errors from your credit report and pay your bills in advance or on time.

Is it fair to charge higher auto and home insurance premiums because someone has a low credit score?

A new rule in Washington state will ban the practice, joining a handful of other states that have similar bans. But the insurance industry is fighting back, arguing that the ban could actually force many customers to pay higher premiums.

Washington’s new rule aims to prevent people with poor credit from facing higher rates for their home, auto and renters insurance – especially during the pandemic, which has disrupted the finances of millions of Americans. The rule is expected to go into effect March 4 and last until federal and state pandemic financial protections end or for three years, whichever is longer. The state insurance commissioner said he would work to make the ban permanent.

Washington argues that using credit scores to calculate insurance premiums is unfair. The state insurance commissioner noted that people who struggle financially (and end up with low credit scores) often fall victim to circumstances beyond their control, such as unemployment, unexpected medical expenses, and natural disasters.

A 2020 to study by the Consumer Federation of America found that good drivers in Washington state with bad credit scores (FICO considers a score below 580 to be bad) paid 79% more for their mandatory auto insurance than drivers with excellent credit. “I just don’t think it’s fair for good drivers to punish them if they’ve had credit problems,” Washington Gov. Jay Inslee said. reported by the Associated Press.

A few other states have bans or restrictions similar to Washington’s new rule, including Hawaii, California, Michigan, Massachusetts and Maryland.

How are credit scores used?

Credit scores are used by lenders to assess the risk of lending you money. The higher your score, the more likely a lender is to consider you a good candidate for all types of loans, from mortgages to student loans to credit cards, and the more likely you are to qualify for credit terms. favorable loan like low interest rates.

But loans aren’t the only way to use credit scores. Insurance companies, utility companies, landlords, and even cell phone companies can check your credit to get an idea of ​​how likely you are to pay your bills on time, and by extension, to decide what kind of terms contracts for which you will be eligible.

Critics of the credit scoring system say it perpetuates economic and racial inequality and is biased against those without access to generational wealth. People of color tend to have disproportionately low credit scores and, by extension, are more likely to turn to subprime lenders who charge exorbitant interest rates and fees. Lower credit scores also mean fewer opportunities for home ownership, business loans and more.

There are also tens of millions of Americans who are effectively invisible to banks and other big lenders because they haven’t established the lines of credit — like credit cards, student loans, or mortgages — needed. to generate a credit report and establish a credit history. And without a credit history, it is extremely difficult to access traditional loan services.

Insurers say rates could rise with credit score ban

Insurance groups are fighting the new rule in Washington. Three groups – the American Property Casualty Insurance Association, the Professional Insurance Agents of Washington and the Independent Insurance Agents and Brokers of Washington – filed lawsuits earlier this month to prevent the ban from taking effect . In a lawsuit, insurers argue that using credit scores to determine insurance premiums and eligibility for coverage is justified because scores are generally good predictors of future insurance claims.

They argue that preventing insurers from using credit scores to calculate insurance rates is an overreach on the government’s part that will restrict the free market and drive up insurance rates for more than a million people. consumers.

There is evidence to support this claim: One 2016 to study by the Vermont Department of Financial Regulation found that a ban on using credit information to set auto insurance rates would raise premiums by nearly 100,000 vehicles. The idea is that these car owners are currently paying less than they would because of their good credit ratings. If a ban were enacted, the study found that the median annual premium increase would be about $33 for this group.

Claire Howard, senior vice president, general counsel and general secretary of the American Property Casualty Insurance Association, said in a declaration that Washington state’s new rule will be “particularly harmful to seniors on fixed incomes and those struggling to recover economically from the COVID pandemic.”

How to get a higher credit score

While the fate of the new rule in Washington is still unclear, many other states allow the use of credit scores when calculating insurance rates. If you’re worried that a bad credit score will drive up your insurance costs, there are a few steps you can take.

Start by making sure you pay all your bills on time. Timely payments are a major factor in your score. It’s also a good idea to try to reduce the amount of available credit you use (called your credit utilization ratio) to less than 30%. Using too much credit at one time can lower your score.

You might consider going with a program like Experian Boost, which lets you add one-time payments to utility companies, phone companies, and even streaming services to your credit report to shore up your score.

You can also turn to a credit repair company. And remember, it takes a long time to adjust your credit. Don’t be surprised if your efforts don’t show up in your score right away.

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Moody’s Investors Service has affirmed Callaway Golf Company’s corporate family rating (CFR) at B1 and probability of default rating at B1-PD. Moody’s has also assigned a B1 rating to the company’s new B senior secured term loan.

The company’s speculative liquidity is unchanged at SGL-2. The outlook remains negative.

Moody’s said Callaway plans to simplify its existing capital structure by refinancing its term debt at Callaway and Topgolf International, Inc. Topgolf was acquired by Callaway in March 2021 in an all-stock transaction valued at 1, $7 billion. Callaway plans to issue a 7-year, $950 million Term Loan B, the proceeds of which will be used to repay existing term debt at Callaway and TopGolf while returning approximately $166 million in cash to the balance sheet. The company also plans to roll out a new $500 million ABL to replace existing revolvers at Callaway and Topgolf. The B1 rating on Callaway’s existing B term loan is due in 2026, and Topgolf’s ratings are unaffected. Upon closing of this transaction and repayment of existing debt, Moody’s will remove the ratings of Topgolf and the existing term loans at Callaway and Topgolf.

Moody’s wrote, “Callaway’s CFR affirmation at the B1 level reflects its broad and growing product diversification within its three business segments which include golf equipment, golf-themed dining and entertainment, and clothes. However, despite this diversification, Topgolf’s rapid expansion comes with the potential for high future business execution risk given that Topgolf’s business is capital intensive, cyclical and discretionary. There also remains some risk that local entertainment will decline as consumers begin to travel more following the easing of travel restrictions. Moody’s expects golf to remain strong in 2022 given that it is conducive to social distancing. However, there remains a risk that some participants will reduce their golf practice as the coronavirus subsides. As families and office workers return to normal activities, there may also be constraints on golfers’ availability of time to practice the sport given the significant time investment required to practice and play. In addition, expanded vacation travel or inflationary pressure on the consumer may reduce attendance and spending on golf equipment and local entertainment activities.

“Callaway’s new capital structure will result in high financial leverage at closing of 5.7x pro forma debt to EBITDA (as of December 31, 2021), including operating leases at Topgolf that have been drafted due to purchase accounting at the time of the Topgolf acquisition and which Moody’s considers a debt. Drafting the leases has added about a U-turn to the leverage. Moody’s expects that financial indebtedness remains elevated through 2022 due to investments in Topgolf and then moderates to less than 5.5x debt to EBITDA ratio by mid-2023 However, the potential for future Execution challenges with its Topgolf expansion strategy or an unexpected drop in demand from its highly discretionary categories could derail its ability to deleverage If the company cannot improve its EBITDA, leverage could increase as the company continues to invest estir in Topgolf sites. While Callaway estimates its future investment needs in Topgolf have grown from approximately $200 million at the time of the acquisition to approximately $70 million at present, Moody’s expects Callaway to reduce new investments in Topgolf and preserves free cash flow if operating conditions turn negative. Moody’s further expects liquidity to remain strong with free cash of $352 million as of December 31, 2021 and full availability of its contemplated $500 million ABL facility.

“The negative outlook reflects execution risk in Callaway’s plans to expand its Topgolf locations and improve EBITDA, which could impact its ability to reduce leverage to less than 5.5x debt to EBITDA over the next 12 to 18 months as debt is expected to continue to rise to fund the construction of the Topgolf site. The negative outlook also reflects the potential for golf-related business to decline from elevated levels seen during the pandemic, which may ease as participation in a wider range of other leisure activities recovers.

Photo courtesy of Calloway/Getty

Personal loans offer fast, lump-sum financing that can be used to consolidate high-interest debt, pay for home renovations, and finance major purchases. At the start of the coronavirus pandemic, personal loans fell sharply – but they are expected to make a strong comeback in 2022.

According to Consumer credit forecast 2022 from the TransUnion credit bureau. Lenders should increase personal loans to primary borrowers with excellent credit and subprime borrowers with credit scores below 660.

“Lenders are eager for continued growth, including returning to the unpreferred consumer segment,” said Charlie Wise, senior vice president of TransUnion.

YOU COULD SEE A LOWER TAX REFUND THIS YEAR, AND THAT’S WHY

Personal loans are expected to exceed pre-pandemic levels, with TransUnion forecasting 20 million loans in 2022. That’s a dramatic increase from 14.2 million loans in 2020.

“This growth will be spurred by an eventual return in demand for credit card consolidation loans as card balances increase,” said Liz Pagel, senior vice president of TransUnion.

Keep reading to learn more about TransUnion’s forecast for the unsecured loan market in 2022, and visit Credible to buy personal loans from multiple lenders at once.

PERSONAL LOAN SETUP FEES: ARE THEY WORTH THE COST?

Personal lenders will again focus on subprime borrowers

Over the past year, the personal loan industry has seen significant growth among borrowers with credit scores between 300 and 660. In the fourth quarter of 2021, personal loans to non-preferred borrowers skyrocketed by 47% over the previous year, according to TransUnion’s Quarterly Credit Industry Outlook Report Q4 2021.

TransUnion expects this trend to continue in 2022 as lenders continue to increase short-term loans to borrowers with subprime credit histories.

“The economy is normalizing and continuing to grow, and these signs of renewed strength encourage lenders not only to focus on lower-risk consumers, but to provide better access to people who may be considered risky. higher credit ratings,” Wise said.

WHAT THE NEW FED ECONOMIC POLICY MEANS FOR MORTGAGE RATES

TransUnion expects personal loans to grow 11% for non-preferred borrowers in 2022, slightly lower than the 14% growth expected among preferred consumers. But due to the increase in subprime loans, delinquencies are expected to increase somewhat.

“While the increase in subprime issuance has led to a slight increase in delinquencies, they remain well below pre-pandemic levels, and delinquencies by risk level remain fairly stable,” Pagel said.

This renewed interest in subprime loans will give consumers with fair or poor credit the opportunity to borrow personal loans to pay off higher interest rate debt and finance major expenses. Subprime borrowers with low credit ratings who are considering taking out a personal loan should shop around with multiple lenders to avoid bad loans with high interest rates.

You can browse current personal loan rates in the table below and visit Credible to see your estimated loan terms for free without affecting your credit score.

93% OF LOAN BORROWERS REGRET MAKING THEIR LOANS

Credit card consolidation will drive personal loan growth in 2022

Demand for personal loans remained weak through early 2021 as consumers received stimulus checks and reduced spending. But amid the economic recovery, consumer spending and revolving credit balances continue to rise — and many borrowers will be looking to unsecured loans to pay off their credit card debt.

“With consumer spending expected to increase in 2022, TransUnion forecasts predict this could lead to a continued rebound in the consumer loan market, especially as consumers begin to seek unsecured personal loans again to shore up growing balances. of their cards,” the report said.

Unsecured personal loans give borrowers the ability to pay off high-interest credit card debt at a low, fixed rate. While the average credit card interest rate is 16.44%, according to the Federal Reserve, the average rate for a two-year personal loan is at an all-time low of 9.09%.

17 BEST PERSONAL LOANS

Personal loans make it easier to pay off revolving credit card balances because they are repaid in fixed monthly installments. Thanks to lower interest rates, well-qualified borrowers could save nearly $2,400 in interest charges by consolidating credit card debt with this type of loan, according to a recent analysis by Credible.

You can learn more about credit card consolidation loans by contacting a knowledgeable loan officer at Credible. You can also use a personal loan repayment calculator to see if this debt repayment strategy is right for you.

CAN YOU USE A PERSONAL LOAN TO PAY OFF YOUR CAR LOAN?

You have a financial question, but you don’t know who to contact? Email the Credible Money Expert at [email protected] and your question might be answered by Credible in our Money Expert column.

Many parents wonder how they are going to pay for their child’s college education, especially since the cost of higher education seems to increase every year. However, borrowing for your child’s education can be more complicated if you have bad credit.

Fortunately, there are ways to find financing even if you have bad credit. Here’s what you need to know.

Start with Parent PLUS Loans

If you need to borrow student loans for your child, Parent PLUS Loans should be one of the first places you should look. These federal student loans allow you to borrow money on behalf of your child who is attending college. It covers the full cost of attendance minus any other financial aid the student receives, such as grants and scholarships.

For many, especially those with poor credit, federal student loans may be a better option than private debt. They are generally easier to obtain and everyone receives the same interest rates, regardless of your credit. They also come with greater protections, such as more flexible repayment options and forgiveness programs.

To qualify for a parent PLUS loan, you must be the biological or adoptive parent of a dependent undergraduate student who is enrolled at least part-time in school. In some cases, a step-parent may also be eligible.

While most types of federal student loans don’t require a credit check, a PLUS parent loan does, but there’s more leeway than you might think. To receive a PLUS loan, you cannot have “adverse credit,” which means you cannot have the following items on your credit report:

• Overdue account balances totaling more than $2,085 over the past two years; or the same amount collected or paid in the last two years
• A tax lien, foreclosure or repossession within the past five years
• Garnishment of wages in the last five years
• Cancellation of federal student debt over the past five years
• Accounts in default in the last five years

If you don’t have a lot of credit to your name or your score is low for other reasons, chances are you’ll be easily approved. There is no minimum credit score requirement, and everyone who qualifies for a parent PLUS loan receives the same interest rate.

If you have experienced credit issues like those listed above, all is not lost. You may still qualify for Parent PLUS Loans, but you will need to take additional steps.

Consider adding an endorser

If you cannot qualify on your own, you can add an endorser to your application. An endorser, similar to a co-signer, is someone who has no adverse credit history and agrees to repay the loan if the parent cannot. The endorser cannot be the child receiving the loan, but it can be another family member or a close friend.

Becoming an endorser carries risks: the endorser is legally responsible for repaying the loan if the primary borrower fails to do so, and any missed payments or negative marks will also appear on the endorser’s credit. However, if you cannot qualify for a parent PLUS loan individually, adding a trustworthy endorser could help.

If you are denied, submit an appeal

If you meet all other loan requirements and can prove that your adverse credit history is due to extenuating circumstances, you may appeal to the US Department of Education. Although approval is not guaranteed, a call may increase your chances of qualifying.

For example, if you were denied a PLUS loan because you previously had an account in collections, you might win an appeal if you can prove that the account has since been paid off or that you have consolidated the debt and have access to debt. a recent file over-time payments. See more examples of how you might appeal an adverse credit history on the Federal student aid website.

If you end up getting an endorser or successfully submitting an appeal, you will need to complete a 30-minute online credit counseling session before the funds are disbursed.

Look at private student loans Next

If you don’t qualify for PLUS parent loans, consider private student loans for parents with bad credit. Private student loans are administered by institutions like banks, credit unions, and online lenders. Some private lenders offer parent-specific student loans, but in other cases, private student loans can be taken out by the student and co-signed by a parent or another adult.

For private lenders, a strong credit score and track record are an important part of eligibility. If you apply with poor credit, you may not qualify, or if you do, you will likely face higher interest rates than with federal student loans. If you don’t have enough credit to qualify, you can add a co-signer with good credit to your application.

When shopping for private student loans, it’s a good idea to compare lenders and their requirements. Many lenders allow you to prequalify before you complete a full application, so you can see if you might qualify for a loan before committing to anything. Since there are no universal standards among private lenders, you may need to go through this step with multiple companies to find a loan you qualify for.

4 alternatives to student loans for parents with bad credit

Having bad credit makes it harder to borrow money. If you’re trying to get your child’s education loans and you’re having trouble, there are some things you can do.

1. Look for grants and scholarships

Grants and scholarships – free money that does not need to be repaid – must be used before taking out any type of loan. The more free money your child gets, the less they will need to borrow (and repay).

There are many scholarship and grant databases that house billions of dollars in awards. Look for different types of awards based on race, gender, socioeconomic background, field of study, and even general interests of the student.

2. Help your child apply for loans

College students typically have more borrowing options for college than their parents — and many student loan products are designed for borrowers with little or no credit. This means it’s probably easier and cheaper for your child to borrow money for their own education.

For example, most undergraduates are eligible for subsidized and unsubsidized federal student loans, which have a fixed interest rate of 3.73% for the 2021-22 school year. These loans require no credit checks, only come into repayment after the student has left school, and have flexible repayment plans that can be based on the student’s post-graduate income.

If you think you’ll have trouble qualifying for a parent student loan, help your child research the options available to them. There will likely be more loan opportunities to choose from at lower rates than a parent with poor credit could find.

3. Work to increase your credit score

If you are determined to borrow parent student loans, build your credit as much as possible before applying. You can do things like:

• Examine your credit report for errors. Review your credit report and verify its accuracy. If you find errors that hurt your score, you can submit a dispute with the relevant credit bureau. The office will investigate the complaint to determine if it is an error, and if so, the offending mark will be removed.
• Repay old debts. If you are behind on payments, consider paying off all old debts you can. Whether it’s a hospital bill or an overdue credit card, it’s a way to boost your score. You may find that lenders are willing to work with you on a new payment plan if it means they get some money back.
• Reduce your use of credit. Your credit utilization, also known as your debt-to-equity ratio, is an important part of your credit score. In short, it measures how much of your total credit limit you spend each month. If possible, keep your credit utilization below 30% to help your credit.

4. Consider other ways to help

If you’re struggling to find ways to pay for your child’s school, see if you can help in other ways. For example, you can reduce tuition costs by allowing your child to live at home while in school. If you think your child should be eligible for more financial help, you can help them appeal for more money.

If you have exhausted your other funding options, consider asking family or close friends to contribute towards tuition as a last resort. While it’s not an option for everyone, lean on your network if you’re lucky enough to have a family with means.

Before money changes hands, establish a written agreement (and repayment plan, if necessary) that works for everyone. This can help ensure everyone understands expectations and reduce misunderstandings later.

Student loans are an option, but not your only choice

Although loans are helpful for many students, other funding opportunities should first be fully exploited. Parents can help their children get all the free money they can by submitting the Free Application for Federal Student Aid (FAFSA) as soon as possible and applying for individual grants and scholarships.

Once this funding is exhausted, consider federal student loans to cover additional costs. If you still need more money after that, consider private student loans as a last option.

Twin brothers from Maryland have won a million dollars and bought a shiny new sports car after the COVID-19 program, but alas, they got caught.

Jerry and Jalel Phillps, both 24, “face federal charges for allegedly obtaining payments totaling more than $1 million in COVID-19 unemployment insurance benefits and loans,” as the relayed the daily thread.

The twins then used some of that cold, hard COVID-related money to buy a 2020 Camaro, as well as to trade cryptocurrency, according to the US Department of Justice. They appeared in US District Court in Greenbelt, Maryland on Wednesday.

It seems that their chances of avoiding prison are not very good.

U.S. Attorney Erek L. Barron for the District of Maryland, along with officials from the Federal Deposit Insurance Corporation and the Department of Labor, detailed the following in a DOJ Press release:

“According to the criminal complaint, the IP addresses linked to Jaleel and Jerry Phillips were used to submit fraudulent Paycheck Protection Program (PPP) loan applications, Economic Disaster Loan (EIDL) applications and unemployment insurance claims resulting in $1 million in funds received.

“As stated in the affidavit in support of the criminal complaint, the Phillips brothers allegedly created fictitious pseudonyms, used the personal identifying information of real people, and used fake businesses or legal entities to apply for EIDL loans and PPP, and unemployment benefits. .”

Of course, this is nothing new. One of the widely undersold results of the pandemic is that people are trying to use it to profit financially. Some surely got away with it.

As the Daily Wire rated“Nearly two years after the government approved aid totaling more than $6 trillion, the U.S. government is now held accountable for where the funds go.”

Follow Sam Amico’s NBA coverage @AmicoHoops and Hoopswire.com.

Small businesses across the country have faced many challenges over the past few years. And now, in addition to Covid-19 and supply chain issues, inflation is taking its toll on small business owners.

The United States Chamber of Commerce released its latest Small Business Index in October 2021. The report found that business owners are dealing with the impact of inflation in many ways. Some small business owners are raising prices. Others have chosen to reduce their workforce to compensate for increased expenses.

Meanwhile, nearly half of small businesses have turned to financing to manage inflation-related issues – 45% of small business owners have taken out a loan.

Current inflation rates

Consumers in the United States faced a 7% price increase for all items between December 2020 and December 2021, according to the Consumer Price Index. The seven percent increase represents the highest annual inflation rate the country has seen in four decades since 1981.

Food and energy prices are among the main contributors to the rise in inflation.

• Food prices have increased by at least 0.5% for 10 consecutive months (from January 2021 to January 2022), leading to an overall increase in the food index of 7%.
• Energy prices have risen 27% over the past year.

How Inflation Affects Small Business Operations

Many Americans are feeling the effects of inflation on their household budgets. Additionally, rising costs can also have a significant impact on a small business’ bottom line.

According to the Small Business Index, almost 75% of small business owners worry about the impact of inflation on their business. Meanwhile, more than two-thirds of small business owners (71%) say their business has already felt a significant impact due to the higher prices they pay in many areas.

A separate survey by the National Federation of Independent Businesses (NFIB) found that 22% of small business owners say inflation is the biggest problem they face. Labor shortages are another common problem, with nearly half of businesses (47%) saying they have vacancies they cannot fill.

Inflation can also have a trickle down effect for small businesses, creating a number of challenges to overcome, including:

• Cash flow difficulties
• Reduced sales
• Demand for higher wages from employees
• Lower profit margins
• Drop in customer satisfaction
• Poor financial health

What types of businesses are most affected?

The effects of inflation can be felt by many types of businesses. However, some companies are likely to experience more difficulties than others. At the same time, some industries could benefit from rising costs.

Businesses that need to buy or hold a large amount of inventory tend to feel the effects of inflation the most. Retailers, wholesalers, and manufacturers can fall into this category.

In comparison, companies in the real estate and mortgage industries could see higher commissions and larger profits due to higher selling prices. Commodity producers (e.g. mining companies, logging companies, etc.) may also benefit from higher profits due to higher material costs.

Should you take out a business loan to deal with inflation?

Many business owners seek financing to deal with the impact of inflation on operating costs. Nearly half of small business owners have taken out a business loan in the past year in response to inflation challenges.

Before deciding to borrow money, however, it’s important to consider whether this is the right approach for your business. If you’re considering getting a business loan to manage the effects of inflation, you might want to ask yourself the following questions first:

1. How much can your business comfortably afford to repay each month?
2. Can you use the funds you borrow to advance your business (eg hire new employees, invest in new technology to improve operations, market to new customers, purchase real estate, etc.)?
3. Will your credit status make it harder or easier to get affordable financing?
4. Can you meet the loan requirements needed to qualify for a business loan?

Borrowing money can also be a good idea if you want to refinance a business loan. If you can take out a new loan with a lower interest rate to pay off existing debt, it could help your business reduce expenses and unexpectedly offset inflation.

If you decide to borrow money for your business, it’s important to take the time to shop around and consider several financing options. Comparing multiple loan offers puts you in a better position to ensure you get the best small business loan available.

Other Ways Businesses Can Fight Inflation

In some cases, a small business loan can be an effective way to manage the effects of inflation. But business financing is not the only option available. Here are three alternative strategies you can consider to protect your small business from inflation.

1. Raise the price of goods and services

Price increases are the most popular way small businesses use to offset the effects of inflation. According to the US Chamber of Commerce, three out of five small businesses say they have raised prices in the past year.

The danger with price increases, of course, is that you might upset your customers. This could lead to lower sales and even the complete loss of some buyers.

For this reason, you may want to consider whether strategic price increases for certain goods or services are a better choice for your business. You can selectively increase prices instead of increasing costs for all customers.

It can also help provide additional benefits to customers in exchange for a price increase. Free shipping, extended warranties, additional services, gifts with purchase, and discount opportunities for future purchases are all potential ideas to consider if you think price increases are needed for your business.

2. Reduce staff and reduce payroll

Another common strategy that small businesses tend to turn to during times of inflation is downsizing. The Small Business Index for the fourth quarter of 2021 indicates that 41% of small business owners have reduced their number of employees in the past year.

Of course, there are also downsides to downsizing your staff. So be sure to carefully consider your situation before taking any action that could potentially harm rather than help your business. If you have to make layoffs, be sure to make your staff reduction decisions in a way that avoids discrimination.

3. Lower the deliverable

Instead of raising prices, some companies are considering an alternative approach. By delivering a little less of a product or service for the same price, your business may be able to cut expenses in a way that’s more palatable (and perhaps less noticeable) to its customers.

Conclusion

Inflation can cause financial stress, especially for small business owners. But there are several strategies you can use to deal with the impacts of inflation and protect the health of your business.

If you think a small business loan might benefit you, take the time to do your research. Comparing multiple loans can save your business a lot of money in interest and fees for years to come.

Our goal is to give you the tools and confidence you need to improve your finances. Although we receive compensation from our partner lenders, whom we will always identify, all opinions are our own. Credible Operations, Inc. NMLS # 1681276, is referred to here as “Credible.”

A personal loan can be used to cover almost any personal expense, such as debt consolidation, a medical procedure, or an unexpected emergency. However, it can sometimes be difficult to budget for a loan, especially if you have a low income.

While there’s no official definition for what low income entails, it’s generally considered as being lower than the median household income, which was $67,521 for full-time workers in the U.S. as of Sept. 2021, according to the U.S. Census Bureau. This broke down into $61,417 for men and $50,982 for women.

Thankfully, there are several lenders that offer low-income loans — so while borrowing money can be stressful, you might still be able to get the money you need.

Here’s what you should know about low-income loans:

9 reputable low-income lenders

There are some lenders with less stringent income requirements than others. Keep in mind that you’ll still likely need to meet other eligibility criteria to qualify, though — such as having good credit.

Here are Credible’s partner lenders that offer low-interest personal loans to borrowers with low incomes:

Lender	Fixed rates	Min. income	Loan amounts
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	9.95% – 35.99% APR	$24,000	$2,000 to $35,000**
Fixed APR: 9.95% – 35.99% APR Variable APR: N/A Min. credit score: 550 Loan amount: $2,000 to $35,000** Loan terms (years): 2, 3, 4, 5* Time to fund: As soon as the next business day (if approved by 4:30 p.m. CT on a weekday) Fees: Origination fee Discounts: Autopay Eligibility: Available in all states except CO, IA, HI, VT, NV NY, WV Customer service: Phone, email Soft credit check: Yes Loan servicer: Avant Loan Uses: Debt consolidation, emergency expense, life event, home improvement, and other purposes Min. Income: $1,200 monthly
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	4.99% – 35.99% APR	Verifiable income must support ability to repay	$2,000 to $50,000
Fixed APR: 4.99% – 35.99% APR Variable APR: N/A Min. credit score: 600 Loan amount: $2,000 to $50,000 Loan terms (years): 2, 3, 4, 5 Time to fund: As soon as 1 – 3 business days after successful verification Fees: Origination fee Discounts: None Eligibility: Available in all states except DC, IA, VT, and WV Customer service: Phone Soft credit check: Yes Loan servicer: Best Egg and Blue Ridge Bank Min. Income: None Loan Uses: Credit card refinancing, debt consolidation, home improvement, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	7.99% – 29.99% APR	N/A	$10,000 to $35,000
Fixed APR: 7.99% – 29.99% APR Min. credit score: Does not disclose Loan amount: $10,000 to $50,000 Loan terms (years): 2, 3, 4, 5 Time to fund: As soon as 2 business days Fees: Origination fee Discounts: No Eligibility: Available in all states except CO, CT, HI, KS, NH, NY, ND, OR, VT, WV, WI, and WY Customer service: Phone Soft credit check: Yes Min. Income: None Loan Uses: Debt consolidation, home improvement, wedding, travel, medical expenses, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	7.04% – 35.89% APR	Verifiable income must support ability to repay	$1,000 to $40,000
Fixed APR: 7.04% – 35.89% APR Min. credit score: 600 Loan amount: $1,000 to $40,000 Loan terms (years): 3, 5 Time to fund: Usually takes about 2 days† Fees: Origination fee Discounts: None Eligibility: Available in all 50 states Customer service: Phone, email Soft credit check: Yes Loan servicer: LendingClub Bank Min. Income: None Loan Uses: Debt consolidation, paying off credit cards, home improvement, pool loans, vacations, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	9.99% – 35.99% APR	$20,000	$2,000 to $36,500
Fixed APR: 9.99% – 35.99% APR Min. credit score: 580 Loan amount: $2,000 to $36,500 Loan terms (years): 2, 3, 4 Time to fund: As soon as the next business day Fees: Origination fee Discounts: Autopay Eligibility: Available in all states except NV and WV Customer service: Phone, email Soft credit check: Yes Min. Income: $20,000 Loan Uses: Home improvement, consolidate debt, credit card refinancing, relocate, make a large purchase, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	6.99% – 19.99% APR1	$30,000	$3,500 to $40,0002
Fixed APR: 6.99% – 19.99% APR1 Min. credit score: 660 (TransUnion FICO®️ Score 9) Loan amount: $3,500 to $40,0002 Loan terms (years): 3, 4, 5, 6 Time to fund: Many Marcus customers receive funds in as little as three days Fees: None Discounts: Autopay Eligibility: Available in all 50 states Customer service: Phone Soft credit check: Yes Loan servicer: Goldman Sachs Min. Income: $30,000 Loan Uses: Credit card refinancing, debt consolidation, home improvement, major purchase, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	5.99% – 24.99% APR	N/A	$5,000 to $40,000
Fixed APR: 5.99% – 24.99% APR Min. credit score: 600 Loan amount: $5,000 to $40,000 Loan terms (years): 2, 3, 4, 5 Time to fund: As soon as 2 – 5 business days after verification Fees: Origination fee Discounts: None Eligibility: Available in all states except MA, NV, and OH Customer service: Phone, email, chat Soft credit check: Yes Min. Income: None Loan Uses: Debt consolidation and credit card consolidation only
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	6.95% – 35.99% APR	Some form of annual income	$2,000 to $40,000
Fixed APR: 6.95% – 35.99% APR Min. credit score: 640 Loan amount: $2,000 to $40,000 Loan terms (years): 3, 5 Time to fund: As soon as one business day Fees: Origination fee Discounts: None Eligibility: Available in all states except IA, ND, WV Customer service: Phone, email Soft credit check: Yes Min. Income: None Loan Uses: Debt consolidation, home improvement, vehicles, small business, new baby expenses, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	4.37% – 35.99% APR4	$12,000	$1,000 to $50,0005
Fixed APR: 4.37% – 35.99% APR4 Min. credit score: 580 Loan amount: $1,000 to $50,0005 Loan terms (years): 3 to 5 years4 Time to fund: As fast as 1 business day6 Fees: Origination fee Discounts: None Eligibility: Available in all 50 states Customer service: Phone, email Soft credit check: Yes Min. Income: $12,000 Loan Uses: Payoff credit cards, consolidate debt, take a course or bootcamp, relocate, make a large purchase, and other purposes
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All APRs reflect autopay and loyalty discounts where available | Read more about Rates and Terms

What is the minimum income needed for a personal loan?

Each lender sets its own threshold for how much you’ll need to earn to qualify for a personal loan. For example, while LendingPoint requires that you have a yearly income of $20,000, you only need a $12,000 income to potentially qualify with Upstart.

Generally, lenders want to know you’ll be able to afford the new loan.

Lenders also typically have other requirements to determine your eligibility, such as your:

• Credit: You’ll typically need good to excellent credit to qualify for a personal loan — a good credit score is usually considered to be 700 or higher. There are also several lenders that offer personal loans for bad credit, but these loans tend to come with higher interest rates compared to good credit loans.
• Debt-to-income ratio: Your debt-to-income (DTI) ratio is the amount you owe in monthly debt payments compared to your income. To be eligible for a personal loan, your DTI ratio should be no higher than 40% — though some lenders might require lower ratios than this.

Regardless of whether you qualify, make sure you’ll be able to keep up with your loan payments before you borrow.

You can use our personal loan calculator below to estimate your monthly payments. Simply enter the loan amount, interest rate, and loan term to see how much you’ll pay over the life of the loan.

Check Out: Installment Loans

How to get a loan with low income

If you’re ready to apply for a low-income loan, follow these four steps:

1. Shop around and compare lenders. Consider as many lenders as possible to find the right loan for you. Be sure to check not only your interest rates but also repayment terms, any fees charged by the lender, and eligibility requirements.
2. Pick the loan option you like most. After comparing lenders, choose the loan that works best for your needs.
3. Complete the application. You’ll need to fill out a full application and submit any required documentation, such as bank statements or pay stubs.
4. Get your funds. If you’re approved, the lender will have you sign for the loan so the funds can be released to you. The time to fund for a personal loan is usually about one week — though some lenders will fund loans as soon as the same or next business day after approval.

If you’re ready to find your personal loan, remember to shop around and compare as many lenders as you can. Credible makes this easy — you can compare your prequalified rates from multiple lenders in just two minutes. Plus, you only need to fill out a single form instead of multiple applications.

Alternatives to low-income loans

Low-income personal loans aren’t your only option if you need to borrow cash. Here are several alternatives to consider:

• Payday loans: While a payday loan might seem like a good option because it doesn’t require a credit check, it should be a last resort. Payday loans commonly come with APRs ranging from 300% to 500%, making them a costly choice in comparison to other types of loans. Similarly, pawn shop loans and cash advance loans should also generally be avoided because of high rates and fees.
• Secured personal loans: Most personal loans are unsecured, but you might have an easier time qualifying for a secured personal loan. Because there’s less risk to the lender, you could also get a lower interest rate. Just keep in mind that if you can’t make your payments, your collateral could be at risk.
• Credit cards: A credit card can be a good option if you need repeated access to cash, though it might be hard to qualify if you have little to no income. Keep in mind that credit cards also typically come with higher rates and fees compared to personal loans — but you might not have to pay any interest if you can pay off your balance before the due date. Secured credit cards could also be an option to consider.
• Check with local credit unions: Because credit unions are nonprofit organizations, they sometimes offer lower rates and better repayment terms than banks and online lenders. Some credit unions also have a low-income designation, meaning their requirements to qualify for loans might be more relaxed compared to other lenders. It’s a good idea to check with credit unions in your area to see if any low-income options — such as a small short-term loan or emergency loan — are available to you.

Learn More: 11 Personal Loans for Non-U.S. Citizens

Can I get a loan if I am unemployed or self-employed?

While some lenders might not be willing to work with borrowers who are either unemployed or self-employed, others do. Here’s what you might expect if you fall into either of these categories:

• Self-employed: Lenders often require borrowers to provide W2s or pay stubs as proof of income — but you might have a hard time producing any of these if you’re unemployed. In this case, lenders might be willing to accept tax returns or bank statements instead.
• Unemployed: If you’re unemployed, you’ll need to show some type of regular income, such as a pension, a retirement account, or government benefits. Some lenders are also willing to extend loans if you can show you’ll be starting a job soon. For example, Upstart works with borrowers who have a full-time job offer that they’ll be starting in the next six months.

If you need a personal loan and are unemployed or self-employed, be sure to consider your options from as many lenders as possible. This way, you’ll have an easier time finding lenders that accept non-traditional income as well as getting a loan that suits your needs.

If you’re ready to start loan shopping, Credible can help — you can compare your prequalified rates from multiple lenders in two minutes, including some that work with unemployed and self-employed borrowers.

Check Out: Fair Credit Personal Loans

What can I do if I don’t qualify for a personal loan?

If you don’t qualify for a low-income personal loan, there are three options that might help you become eligible in the future:

• Improve your credit score: Lenders use your credit history to determine whether to approve you for a loan. If you can wait to borrow money for now, it could be a good idea to spend some time building your credit before you apply again. A few ways to potentially improve your credit include making on-time payments on all your credit and utility bills, keeping credit card balances low, and avoiding new loans for the time being.
• Apply with a cosigner: Having a creditworthy cosigner could help you get approved for a loan. Not all lenders allow cosigners on personal loans, but some do. Even if you don’t need a cosigner to qualify, having one could help you get a lower interest rate than you’d get on your own.
• Local charities or programs: There are many organizations across the country that might be able to help you if you’re in a financial rough spot. For example, 211 can help you connect to social services available to you.

Keep Reading: 13 Best Debt Consolidation Loans for Fair Credit

About Rates and Terms: Rates for personal loans provided by lenders on the Credible platform range between 4.99-35.99% APR with terms from 12 to 84 months. Rates presented include lender discounts for enrolling in autopay and loyalty programs, where applicable. Actual rates may be different from the rates advertised and/or shown and will be based on the lender’s eligibility criteria, which include factors such as credit score, loan amount, loan term, credit usage and history, and vary based on loan purpose. The lowest rates available typically require excellent credit, and for some lenders, may be reserved for specific loan purposes and/or shorter loan terms. The origination fee charged by the lenders on our platform ranges from 0% to 8%. Each lender has their own qualification criteria with respect to their autopay and loyalty discounts (e.g., some lenders require the borrower to elect autopay prior to loan funding in order to qualify for the autopay discount). All rates are determined by the lender and must be agreed upon between the borrower and the borrower’s chosen lender. For a loan of $10,000 with a three year repayment period, an interest rate of 7.99%, a $350 origination fee and an APR of 11.51%, the borrower will receive $9,650 at the time of loan funding and will make 36 monthly payments of $313.32. Assuming all on-time payments, and full performance of all terms and conditions of the loan contract and any discount programs enrolled in included in the APR/interest rate throughout the life of the loan, the borrower will pay a total of $11,279.43. As of March 12, 2019, none of the lenders on our platform require a down payment nor do they charge any prepayment penalties.

⁴The full range of available rates varies by state. The average 3-year loan offered across all lenders using the Upstart platform will have an APR of 21.97% and 36 monthly payments of $35 per $1,000 borrowed. For example, the total cost of a $10,000 loan would be $12,646 including a $626 origination fee. APR is calculated based on 3-year rates offered in the last 1 month. There is no down payment and no prepayment penalty. Your APR will be determined based on your credit, income, and certain other information provided in your loan application. Not all applicants will be approved.

⁵This offer is conditioned on final approval based on our consideration and verification of financial and non-financial information. Rate and loan amount are subject to change based upon information received in your full application. This offer may be accepted only by the person identified in this offer, who is old enough to legally enter into contract for the extension of credit, a US citizen or permanent resident, and a current resident of the US. Duplicate offers received are void. Closing your loan is contingent on your meeting our eligibility requirements, our verification of your information, and your agreement to the terms and conditions on the www.upstart.com website.

Your loan amount will be determined based on your credit, income, and certain other information provided in your loan application. Not all applicants will qualify for the full amount. Loans are not available in West Virginia or Iowa. The minimum loan amount in MA is $7,000. The minimum loan amount in Ohio is $6,000. The minimum loan amount in NM is $5100. The minimum loan amount in GA is $3,100.

⁶​If you accept your loan by 5pm EST (not including weekends or holidays), you will receive your funds the next business day. Loans used to fund education related expenses are subject to a 3 business day wait period between loan acceptance and funding in accordance with federal law.

About the author

Lindsay VanSomeren

Lindsay VanSomeren specializes in credit and loans. Her work has appeared on Credit Karma, Forbes Advisor, LendingTree, and more.

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