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Personal Loans for Low-Income Earners

Whether you want to pay bills, purchase a home or a new car, a loan can come in handy. However, getting a loan when you are on low income can be a bit of a task.


It’ll give you a better feeling to know that there’s a way out for low-income earners – personal loans for low-income earners. We will tell you everything you need to know to get you started with these loans. But first, let’s see some of the best low-income loan lenders

  • Representative APR %
  • Highest Loan Amount
  • Repayment Period
  • Varies
  • $2,500
  • 2 – 7 Years
Avant Loans
  • 9.95% – 35.99%
  • $2,000 - $35,000
  • 2 - 5 Years
  • 59% – 199%
  • $500 - $5,000
  • Up to 2 Years
  • APR range
  • Fees
  • Terms
  • Amounth
  • Unemployment protection
Bank 1
  • 6.95%–35.89%
  • Up to 5% transfer fee
  • 3–5 years
  • $1,000–$40,000
  • No
Bank 2
  • 6.95%–35.89%
  • Up to 5% transfer fee
  • 3–5 years
  • $1,000–$40,000
  • No
Bank 3
  • 6.95%–35.89%
  • Up to 5% transfer fee
  • 3–5 years
  • $1,000–$40,000
  • No

Table of Contents

What is a low-income loan?

These are loans offered to low and medium-income earners by banks or other financial institutions. The loans are also a good option for individuals with a low credit score.


Please note that you are considered based on much more than just your earning. Such factors as your place of residence and your family size also matter. 


You might be required to provide proof of income. The loans are available for those earning as low as $800 per month.


Low-income loans are known to carry fairly low-interest rates. They also have flexible repayment terms. 


You can use these loans to pay for your education, sort out medical bills, pay rent, or take care of other personal needs.

Requirements to qualify

Low-income loans may not be the easiest to qualify for. While there are a couple of requirements, your low income not always is the reason you miss out on your loan.


Different lenders consider different factors before offering you a loan. One of which is your ability to repay your loan. Here, most lenders look at your debt-to-income ratio. That is your total income compared to your total debts. Having more unsettled debts than your income might have you miss a loan.


Some lenders may also check your credit score to know your credit standing and history. An excellent credit score coupled up with modest earning can get you competitive loan offers with better terms and low-interest rates.


However, most of them will still offer you loans even with a poor credit score.

Hot Tip:

An excellent credit score coupled up with modest earning can get you competitive loan offers with better terms and low-interest rates.

Differences between a loan and a low-income loan

  1. Interest rate: Compared to payday loans, low-income loans are known to attract fairly lower interest rates. They carry an APR of up to 399%. Please note, however, that interest rates are determined by different factors including your credit score, debt-to-income ratio, and repayment history.
  2. Repayment terms: Most low-income loans, especially long-term low-income loans often have better repayment terms compared to payday loans. Most have repayment periods of up to 7 years. This allows you to pay back your loan without feeling much of a burden since it’s divided into manageable bits.
  3. Proof of income: Other loans, mostly payday loans, might not require you to give proof of your income. For low-income loans, however, proof of income is a requirement. The loans are meant for those on the medium and low-income threshold. 
  4. Processing time: For the majority of payday loans, you’ll have your money in no more than 24 hours. Most low-income loans aren’t any different. However, some might take longer to process. 

What Do You Need to Know About?

  • Interest rate: Low-income loans, as earlier mentioned, have fairly lower interest rates with an APR of up to 399%. However, this highly depends on the specific lender and your credit profile. Most low-income lenders will also grant you lower interest rates if you show proof of higher income.


  • Guarantees: You don’t need a guarantor to access loans for low-income earners. Nonetheless, having one might unlock higher loan amounts. You may also access more flexible payment terms and lower interest rates. Getting a guarantor is also an excellent option if you have a bad credit score. Alternatively, you can get a co-signer with a stellar credit score and a higher income to act in good faith during application. By co-signing for you, they accept to bear the loan in the event you are unable to repay it. 


  • Repayment terms: Loans for low-income earners have fairly flexible repayment terms. Long-term low-income loans have a repayment period of up to 7 years. Short-term low-income loans range from 3 months. Please note that different lenders set different repayment terms based on many factors including your financial profile. 


  • Lending criteria: to qualify for a low-income loan, lenders will mainly check your credit profile. Most of them will look at your debt-to-income ratio, your debt load, and employment history. While evaluating your ability to repay the loan, some lenders will also look at your investments, savings accounts (if you have any), and liquid assets. 

How much can you borrow?

You can borrow from as low as $100 to as high as $35,000. Some financial institutions might be inclined to go even higher. It all depends on your ability to repay. 


While a poor credit score might not be the reason you miss out on a loan, a stellar credit score will unlock even better loan amounts and repayment terms.


Getting a cosigner with a decent income and good credit profile can unlock better opportunities for you. A guarantor will just be as good. 


Tempting as it may seem, avoid loans you won’t be able to repay. Only borrow what you can repay at the agreed terms. This way, you’ll pay it comfortably without falling into a debt cycle.


While sourcing a good low-income lender, how much you can borrow shouldn’t be the only thing you consider. Dig deep into their repayment terms, interest rate, and duration of payment.

Hot Tip:

Tempting as it may seem, avoid loans you won’t be able to repay. Only borrow what you can repay at the agreed terms.

Personal Loans for Low-Income with No Fees

Personal loans for low-income are flexible, carry better repayment terms, and are highly accessible. However, you’ll still incur different fees and interest.


Some governments and private institutions set aside funds in the form of personal loans for low-income earners. Most of which come with no interest or other fees. 


This is mostly a collaboration between the Federal government, banks, charities, and other non-profit organizations through a program dubbed the FIDC program. 


The funds are mainly donations.


You could also opt for loans from close friends and family if you’re looking to significantly cut costs. It will also save you from the risk of recurrent debts and you won’t have to worry about your credit profile. 

How Much Do You Have to Make To Get A Personal Loan?

Different lenders have different income requirements for you to access personal loans for people with low incomes.


However, the majority of lenders require that a borrower be earning about $800 per month. Meeting this threshold is the most important requirement. Though other factors such as credit score might be considered, they may not have a strong influence over the possibility of acquiring your loan as proof of your income.


In case your total income doesn’t meet the lender’s threshold, you have the option of using more than one source of income.


For instance, if you work more than one job, you can combine all the sources. The same applies to those on income and receiving some sort of benefit such as disability benefit at the same time. They can combine the two to meet the income requirement.

Frequently Asked Questions (FAQ)

The qualification requirements differ from one lender to another. But, basically, anyone with a source of income and a good debt-to-income ratio can apply for loans for people with low income. A good credit report and payment history also play a major role in determining not only the amount you’ll receive but the terms and interest, too.

Most lenders have different income thresholds that borrowers should meet to qualify for low-income loans. However, the average income requirement most lenders require is a minimum of $800 per month.

If you are not comfortable with taking a low-income loan, alternatives such as taking soft loans from family and friends will suffice. Similarly, low-income loans from the Government that mostly come with reduced interest rates will help. You can also consider getting a co-signer or a cash advance.

You can borrow from as low as $100 up to $35,000. The amount you can borrow depends on such factors as your credit profile, level of income, and repayment history. Getting a co-signer with a good credit profile and a decent income can also help you access higher loan limits.

The interest varies depending on the lender, your credit score, income, and repayment history. However, loans for low-income earners carry an average APR of up to 399%.

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