Spot loans are designed to provide speedy financing to borrowers facing an unexpected expense — but that fast cash often comes at a high price. If youre considering a spot loan, be sure to understand the pros and cons before pulling the trigger.
Getting approved for a loan can be tricky when you have bad credit. Many traditional lenders will deny your application if your credit score falls below a certain threshold. This leaves people with poor credit feeling like they have no options when they need money fast.
However, there are some lenders like Spotloan that may approve you even if your credit isn’t great. In this article, we’ll explain what credit score you need to qualify for a Spotloan and steps you can take if you don’t quite meet the requirements.
What is Spotloan?
Spotloan is an online lender that provides installment loans between $300 and $800. Their loans are designed to help cover emergency expenses or bridge the gap between paychecks when your finances are tight
Unlike payday loans that require full repayment by your next pay date, Spotloan offers flexible 3- to 10-month repayment terms This makes the payments more affordable and easier to manage
Spotloan services all states except Arkansas, New York, and West Virginia. Loan terms and availability vary by state.
Spotloan’s Minimum Credit Score Requirements
Spotloan doesn’t publish an official minimum credit score requirement. They state that they consider applicants with all credit backgrounds, including bad credit.
However, based on customer reports, it appears your chances of approval are highest if your credit score is at least 600. Applicants with scores in the mid 500s may get approved, but usually need steady income to qualify. Those with credit scores below 550 will likely get denied.
Here’s an overview of approval odds based on credit score:
- 600+ credit score – High chance of approval
- 550-599 credit score – Possible approval with good income
- 500-549 credit score – Low chance of approval
- Under 500 credit score – Very unlikely to get approved
So while Spotloan doesn’t have a posted minimum credit score, applicants with at least 600 and stable income have the best shot at getting approved. The lower your score, the less likely you are to meet Spotloan’s lending criteria.
Other Factors Spotloan Considers
Your credit score isn’t the only thing Spotloan looks at when reviewing your application. Here are some other key factors that impact your approval chances:
Income – Spotloan requires you have a regular source of income from a job, self-employment, social security, disability, or other benefits. The more income you have in relation to your loan request, the better.
Existing debt – Too much existing debt compared to your income could make it harder to get approved. Spotloan may deny applicants who seem overextended.
Credit history – Having some established credit accounts like credit cards, auto loans, or mortgages can help offset a lower credit score. Insufficient credit history can hurt your chances.
Bank account information – You need an active checking account to receive your funds and make payments. Lacking a bank account may lead to denial.
ID verification – Spotloan verifies your identity and address. Inability to validate your information is grounds for rejection.
Previous Spotloan loans – Applicants who’ve had a Spotloan before must be in good standing. Past defaults could cause a denial.
Meeting the minimum credit score threshold doesn’t guarantee approval. But having good credit improves your chances of meeting Spotloan’s other lending criteria.
Steps to Take If You Don’t Meet Requirements
What if your credit score falls below 600 and you get declined for a Spotloan? Don’t panic. Here are some steps you can take to improve your chances of getting approved next time:
Wait and reapply in 6 months – Spotloan suggests waiting at least 6 months after a denial to reapply. This gives you time to work on improving your credit or financial situation.
Check for credit report errors – Mistakes on your credit reports could be dragging down your score. Dispute any inaccuracies with the credit bureaus to potentially boost your score.
Pay down debt – Reducing credit card balances and other debts can also help raise your poor credit score over time. Pay off collection accounts if possible.
Become an authorized user – Ask a family member with good credit to add you as an authorized user on a credit card. Their on-time payments will be added to your credit history.
Take out a credit builder loan – Credit builder loans report your on-time payments to the credit bureaus each month. They can help build your score from the ground up.
Get a secured credit card – Secured cards require a cash deposit upfront and help establish positive payment history.
Add income – Taking on a side gig or part-time work can give your application a boost by increasing your income.
Apply with a cosigner – Adding a cosigner with good credit may help compensate for your poor credit if you reapply.
Explore other bad credit lenders – Companies like OneMain Financial, Avant, and LendingPoint may approve lower scores than Spotloan.
With some time and effort, you can hopefully improve your financial standing enough to meet Spotloan’s lending criteria on your next try. Don’t get discouraged if your credit score or other factors resulted in a denial.
The Bottom Line
While having a credit score of at least 600 gives you the best approval odds, Spotloan does consider applicants with poor or fair credit. They look at your entire financial profile, not just your credit scores.
If your credit falls below 600, take steps to strengthen your credit and income before reapplying. This will greatly improve your chances of getting approved for the emergency funds you need. With Spotloan’s online application and fast lending decision, they provide a convenient backup option for borrowers with less-than-perfect credit.
What is a spot loan and how does it work?
Spot loans are a type of installment loan intended to cover sudden personal or commercial expenses. Theyre often offered by online lenders and issued immediately upon application, giving you access to your funds within a few hours of approval. Spot loans generally require little or no collateral to back the loan. There may not be strict credit score requirements, which makes them appealing to borrowers with low credit scores.
However, in exchange for this increased accessibility, spot loans have some notable drawbacks. First, spot loans typically have a shorter repayment period than other personal loans — generally two years or much less. This may result in a higher monthly payment than you would find with other types of financing. Second, spot loans often charge high interest rates and other steep fees.
A spot loan may be right for borrowers who are in immediate need of funds or whose credit scores would prevent them from qualifying for other types of loans. However, before considering a spot loan, borrowers need to be sure that they can keep up with the high monthly payments, interest rates and other fees.
Pros of spot loans
- Issued quickly. Most spot loans are available online or by phone. Once the lender has reviewed your application, you can be approved very quickly. This speedy process makes spot loans a fast, convenient source of cash in a financial emergency.
- No collateral necessary. Spot loans are usually unsecured. In other words, they dont require collateral, which is a valuable asset (such as your savings account, investments or automobile) that backs up your debt in case you miss the payments. This means youre not at risk of losing personal property if you cant repay your loan.
- Often available to borrowers with lower credit scores. The lower your credit scores, the less likely you are to qualify for credit. If youre unable to secure other types of loans, credit cards and lines of credit, spot loans typically have looser credit score requirements.
Spotloan Personal Loan review: How it works & what it costs. Great for poor credit up to $800.
FAQ
Is spotloan easy to get approved?
Fast approval and funding: Spot loans are meant to be accessed fast. They usually have an easy application process, an immediate spot loan approval decision, and funding on the same day you apply. No collateral required: Spot loans don’t require you to put up any personal assets, like your car, as collateral.
Will a bank give you a loan with a 500 credit score?
A personal loan, payday loan, and secured loans are all options that can make it possible to get a loan even with a 500 credit score. In most cases, you will need a steady source of income and to prove your ability to repay your loan on time.
What is the minimum credit score for a payday loan?
Early Payday Loans do not require a minimum credit score, but are subject to review and approval.
How do you qualify for spotloan?
- A job or other regular source of income.
- A checking or savings account.
- A SSN, a valid email address, a mailing address, and phone number.
- To be at least 18 years old.