Financial Options: Getting a Loan with a 650 Credit Score

One of the key essentials for applying for a loan is to have a credible credit score. This is calculated through different financial information, from your loan history to your spending habits. Naturally, a person with a credit score of 700 and above will have plenty of loan options to choose from. On the other hand, someone who ranks slightly below the 650 mark will have fewer financial strategies to work with.

Working with a 650 Credit Score

A credit score around the range of 650 isn’t a terrible score. In fact, there are worse rates you could get, especially if you have an unappealing credit history. Nevertheless, 650 is generally a low benchmark for lenders, making you a risky borrower for traditional loans in their books. Thankfully, there are other financial solutions even with a risky credit score, by applying for a personal loan.

If you have a credit score of 650 or below, here are four strategies you can use to apply for a loan:

1. Stick to What You Need

A common mistake borrowers make is borrowing too much than necessary. This is usually to set an allowance for any additional expenses they may need. Although this strategy has its merits, it’s not ideal to borrow large amounts with personal loans.

Since you already have a low credit score, you’ll always be at risk of dealing with high interest rates. Even if you extend the loan term to a longer period, you’ll still lose more in net value even if you’re paying less every month. Remember to pick the shortest term with minimal interest so you won’t have an additional financial burden to cover later on.

2. Go Rate Shopping

A personal loan only needs a borrower to have a credit score of 550 and above to qualify for an application. Although this value varies from lender to lender, their benchmark is generally around this value. This is why you need to be smart in hoping for the best rates for a personal loan.

Keep in mind that personal loans typically have low borrowing limits with high interest rates. This inverse relationship becomes more significant the lower your credit score is. For this reason, you need to look for lenders that provide the best rates for the loan amount you need.

3. Look for a Cosigners

One way to lower your risk factor as a borrower to lending entities is to have a cosigner for the personal loan. It’s generally advisable to look for a cosigner who has a much higher credit score than yours. This will let you receive better loan terms for lenders since the basis of your contract will depend on your cosigner’s credit.

4. Look for Secured Loans

If you don’t want to depend on a cosigner for better loan terms, you can use your assets to serve as collateral for your personal loan. Although most personal loans are unsecured, some lenders allow secured loans that hold a borrower’s assets for collateral. This can include different ownerships from jewelry, real estate, and even investment accounts. Keep in mind that this is a risky option if you’re in a financially unstable position.


Different lending companies will have varying benchmarks for their credit score computations. However, that doesn’t mean that your 650 credit score with one lender will be a 720 in another. This is why it’s essential to understand the lending company you want to work with. By sifting through the sea of options available, you’ll find the provider that can give you the right financial solution without putting your financial stability at risk.

At Parkway Finance, we understand our clients’ concerns to receive financial solutions for time-sensitive needs. Our clear and straightforward repayment plans let our borrowing process become quick and simple for you! If you’re looking for ,personal loans with favorable rates for your credit score, contact us at 205-853-3339 today!