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5 credit-builder loans with no credit check or low credit requirements

Build savings and your credit history at the same time.

Credit-building loans can improve your credit history to make qualifying for traditional credit lines easier. And because of their design, they offer a nice little nest egg once you’ve repaid them.

What is a credit-builder loan?

A credit-builder loan is an installment loan. But unlike traditional loans, you don’t get any cash upfront.

Credit-building loans involve making fixed payments over a set term, such as $100 for 24 months, and the lender places the payments in a locked account. The lender also reports the payments to the credit bureaus to help build a better credit score. Once the term is over, the lender releases the funds to you, usually minus interest paid as a fee for the service.

The idea with these loans is that by the end, you’ve built a credit history and saved up a little nest egg. Think of a credit-building loan like a savings account that requires contributions and builds your credit history.

5 credit-builder loans to build credit

Big banks like Chase, Wells Fargo and Bank of America typically don’t offer credit-building loans. These products are often offered by fintech companies, small banks or credit unions. Credit-building loans are designed for people with poor or limited credit, so institutions usually have very lenient credit score requirements or don’t check your credit score when you apply.

1. Self credit builder loans

Self Credit Builder

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on Self's secure site
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Self is a fintech company that offers four different 24-month credit-builder loans with no credit check. You choose a monthly payment of either $25, $35, $48 or $150. Self holds the funds in a certificate of deposit, and after 24 months of successful payments, it releases the funds to you minus the interest. Depending on your loan choice, you save between $520 to $3,076. Self also offers free rent reporting and a secured credit card, which you become eligible for by having the credit-builder loan. However, there's a fee for paying with a debit card.

2. Republic Bank Credit Builder & Savings Program

Republic Bank Credit Builder & Savings Program

on Republic Bank's secure site
Republic Bank is an FDIC-insured traditional bank. It offers the Credit Builder & Savings Program with multiple loan amounts and term options. Amounts range from $500 to $1,500, and terms can be either 12, 18 or 24 months. The smallest monthly payment advertised is $22.97 on the $500 credit-builder loan for 24 months. Republic places the funds in a certificate of deposit and charges an APR from 9% to 9.5%, which you pay as a fee for the service. The credit score requirements are unclear but are likely lenient, as these products are designed for those with limited credit histories.

3. Ava Credit Builder Account

Ava Card ‍Build Credit


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on Ava's secure site
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Ava is a fintech company that offers a credit-building loan called the Credit Builder Account. There's no hard credit check or any APR. The loan has a $30 monthly payment for 12 months, and you get the full $360 back once the term is over. Ava reports to all three major credit bureaus and can report payments within 24 hours so you can see quick results. But it's not free. You'll need the Ava paid subscription plan for $9 per month ($108 per year) or $72 for the yearly plan.

4. MoneyLion Credit Builder Plus

MoneyLion Credit Builder Plus

on MoneyLion's secure site
MoneyLion's Credit Builder Plus Membership offers 12-month credit-builder loans up to $1,000, with no credit check. It reports payments to the three major credit bureaus, and once you pay off the amount, it releases the funds to you. However, MoneyLion requires a monthly subscription fee of $19.99, separate from the monthly payments you'd make on the credit-builder loan.

5. Credit Karma

Credit Karma Credit Builder

Largely known for its credit-monitoring service, Credit Karma also offers credit-building loans with its Credit Karma Money Credit Builder. You need to open the digital Credit Karma Money Spend account and set up direct deposit of $750 or more to be eligible for the credit-builder account. You choose how much you want to contribute to the Credit Builder account, which can be as low as $10 per paycheck. It reports the payments to the credit bureaus and stores them in a locked savings account. Once you've saved $500, Credit Karma releases the funds to you. However, Credit Karma only offers this product to people with a TransUnion credit score of 619 or below. But that's good news if you want to improve a poor credit score.

Is a credit-builder loan a good idea?

Credit-building loans can be worth it if you have poor credit and want a relatively low-risk way to start building credit history. However, like with any loan product, if you miss your payments, the lender may report those negative marks to the credit bureaus — so make sure you can easily afford the payments.


  • Get your cash back. Funds are released to you by the end of the term minus interest and fees.
  • Easy to qualify for. Most credit-building loans don’t check your credit score or have very low credit score requirements.
  • Improve your credit score. Lenders report credit-building loans to the credit bureaus, so timely payments can increase your credit score.
  • Short terms. Most credit-building loans have terms under two years, so they’re not long-term commitments.
  • Low payments. Credit-building loans normally have monthly payments under $100 or so, which can make them affordable for most people.


  • Funds are locked. You won’t get any funds upfront, and you can’t access your funds until the end of the term.
  • Must be responsible. If you miss credit-builder loan payments, you risk harming your credit score. Make sure you can afford the loan before taking it on.

Alternatives to credit-builder loans

If you aren’t sure about credit-builder loans, consider other options to build credit.

  • Debit-credit cards. These hybrid cards work a lot like a credit card and checking account in one and often don’t charge APR. Your bank account balance sets the card’s limit, so you only spend what’s in your account, helping you avoid excessive debt.
  • Secured credit cards. These cards work like regular credit cards, but they’re secured by a cash deposit. Secured credit cards typically have low credit score requirements and are often designed to be someone’s first credit card.
  • Personal loans. These unsecured installment loans offer a lump sum for vacations, home improvements, debt consolidation and more. They may require good credit to quality, but there are personal loans for poor credit.
  • Credit-building apps. Consider credit-building apps such as Experian Boost® and StellarFi, which provide rent reporting and other credit-building tactics to bolster your credit history.

Bottom line

A credit-builder loan can be a great and safe way to improve your credit score. However, like with any loan, it can do more damage than good if you don’t make your payments on time. If credit-builder loans aren’t for you, there are many other ways to build your credit history.

Frequently asked questions

How fast does a credit-builder loan work?

You’ll likely see an impact on your credit score and history as soon as one month. Most creditors report loans and payments monthly. Depending on your current credit score, you may see a marked improvement in a few short months, provided you stay on top of the payments.

How much will a credit-builder loan improve your credit score?

It depends on your current credit score. You may see a boost anywhere from 40 to 100 points with timely payments by the time the credit-builder loan is over.

Is it bad to pay off a credit-builder loan early?

If you really need to pay it off early, you can. Most credit-building loans we’ve seen don’t have prepayment penalties, but ask the lender to be sure.

However, the point with credit-builder loans is to get as many on-time payments reported to the credit bureaus as you can. By paying it off early, you reduce the number of payments added to your credit file, therefore defeating the purpose of a credit-building loan.

Written by

Bethany Hickey

Bethany Hickey is the banking editor and personal finance expert at Finder, specializing in banking, lending, insurance, and crypto. Bethany’s expertise in personal finance has garnered recognition from esteemed media outlets, such as Nasdaq, MSN, Yahoo Finance, GOBankingRates, SuperMoney, AOL and Newsweek. Her articles offer practical financial strategies to Americans, empowering them to make decisions that meet their financial goals. Her past work includes articles on generational spending and saving habits, lending, budgeting and managing debt. Before joining Finder, she was a content manager where she wrote hundreds of articles and news pieces on auto financing and credit repair for CarsDirect, Auto Credit Express and The Car Connection, among others. Bethany holds a BA in English from the University of Michigan-Flint, and was poetry editor for the university’s Qua Literary and Fine Arts Magazine. See full profile

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2 Responses

    Default Gravatar
    ShashanaApril 15, 2019

    Hello! Why can’t I get a payday loan?

      JoshuaApril 15, 2019Finder

      Hi Shashana,

      Thanks for getting in touch with Finder. I’m sorry to hear about the trouble you are having.

      The main reason that you weren’t approved for a payday loan is that you don’t meet their eligibility requirements. Thus, it would be a good practice to make sure that you’ve read the relevant T&Cs or PDS of the loan products before making a decision. Moreover, check the eligibility requirements as well and consider whether the product is right for you.

      To improve your chance of getting approved, please read our guide, “7 tips to avoid getting rejected for a personal loan.”

      Aside from tips, you can also learn on that page how you can increase your chances of approval, the factors to consider when applying for a personal loan, and others.

      I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.

      Have a wonderful day!


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