You can be denied for a credit-builder loan if you have a negative banking history or you don't have enough income to make the monthly payments. You can also be denied for a credit-builder loan if you apply through a credit union and you don’t qualify for a membership.
Credit-builder loans are designed for people with bad credit or no credit at all, so they usually have minimal approval requirements and you're likely to be approved. Below is a list of common requirements for a credit-builder loan.
Common Credit-Builder Loan Requirements
- Be at least 18 years old
- Be a U.S. citizen or permanent resident
- Have a Social Security number
- Have a valid bank account with proof of income
- Provide employment information and housing status
Credit-builder loans are fairly easy to qualify for, even if you have bad credit or no credit at all. Since the lender is in control of the funds, there is less risk in loaning you money.
For more information, you can check out WalletHub’s guide to credit-builder loans as well as our top picks.
This answer was last updated on 02/21/24 and it was first published on 02/17/23. For the most current information about a financial product, you should always check and confirm accuracy with the offering financial institution. Editorial and user-generated content is not provided, reviewed or endorsed by any company.
