To obtain a loan with poor personal credit, individuals should consider secured loans, alternative credit references, co-signers, or online lenders. Secured loans require collateral, such as a savings account or asset, to offset risk. Alternative credit references, like utility bills or rent payments, can demonstrate financial responsibility. Co-signers with strong credit may approve the loan, sharing responsibility. Online lenders often use alternative data and offer flexible terms.

Poor credit scores (below 600) typically result in higher borrowing costs or denial due to perceived risk. The Federal Reserve reports that only 19% of applicants with subprime credit secure traditional loans without collateral. Secured loans approval rates average 65%, per the Consumer Financial Protection Bureau (2022). Alternative credit models, such as those using payment history from non-traditional sources, improve access by 30% (Equifax, 2023). Co-signers increase approval chances by 50% but expose them to debt risks if the borrower defaults. Online lenders approval rates for subprime borrowers reach 45%, driven by automated underwriting and alternative data (LendingTree, 2023). These strategies mitigate risk for lenders while enabling credit access for underserved borrowers.