Loans for Bad Credit

Last Updated on Dec 11th, 2023

The Credit bureau institutions, which give credit reports on bank customers, are now available in Nigeria. The reports are based on the credit behavior or activities of bank customers. Generally, poor credit history affects your reputation with your bank, and it may make it difficult for you to get a loan in the future.

Maintaining a good credit score is very important because the Central Bank of Nigeria is working on rules that will make it practically impossible for people with bad credit history to get loans.

What are bad credit loans?

Bad credit refers to a low credit score or a short credit history.

Loans for bad credit are an option for people whose credit reflects some financial missteps or people who haven’t had time to build a credit history. These loans are either secured (backed by collateral like a home or car) or unsecured. Interest rates, fees, and terms for these types of loans vary by lender.

Various banks, credit unions, and online lenders offer loans to those with weak credit, but the threshold for what’s considered a “creditworthy borrower” varies by institution. Some lenders have stricter requirements than others, which makes it important to shop around thoroughly when looking for a loan. Read also loans for blacklisted in Nigeria.

What are the common mistakes that can lower my credit score?

Here are some common mistakes that can lower your credit score with your bank;

  • Paying bills late

One of the biggest factors in determining your credit score is your past payment history. While one or two late payments on your credit cards, loans, or other important obligations over a long period may not significantly damage your credit record, making a habit (or mistake) of it can count against you.

  • Not paying the minimum amount required

If you don’t pay at least the minimum amount due, your creditors will eventually report your account as past due, which can damage your score. Additionally, paying less than the minimum can result in late fees and additional interest charges which can add up quickly.

  • Keeping debt levels too high

If you “max out” or already owe a lot of money on your credit cards, or you get multiple loans from banks, potential creditors may question your ability to repay. Creditors also use this information to evaluate loan approval or interest rate charges (higher interest rates are used to compensate for higher risk).

  • Not using your full legal name in financial documents

Bank accounts, credit applications, and other documents that become part of your credit history come to be on your report through a variety of ways, many of which do not have many other identifying factors. Using your full legal name helps to make sure that your information ends up on your report.

Notwithstanding the above, there is a possibility for you to access loans, even if you have bad credit. However, your credit score keeps you from getting a great Annual Percentage Rate, it is also possible for you to find interest rates that are much lower than those you’d likely find on payday loans.

How do I get bad credit loans?

Generally, due to the impacts of COVID-19, many banks and online lenders are adjusting their personal loan offerings.

However, there remains a wide range of bad credit loan providers. These come with affordable interest rates and convenient services. Some of these loan providers include

  • Loan aggregators
  • Peer-to-Peer lenders(P-2-P)
  • Personal loan lenders with flexible credit score


Bad credit is a substantial limitation to any individual. However, there still exists an opportunity for you to obtain a loan, even without good credit.

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