Learn How to Get a Line of Credit with Bad Credit

It can be challenging to obtain a line of credit if you have good credit. When you need money, seeking lenders who provide “bad-credit” lines of credit may not be your only — or even the best — option. Other types of credit may be worth exploring.

Line of Credit with Bad Credit

 A line of credit, if accepted, allows you to access cash on demand. You can borrow up to a certain amount and will only be charged interest once you borrow. If you still need to save for an emergency fund and want to be prepared for unexpected expenses, a line of credit can provide you with the security you require. However, some lenders may only offer credit lines to persons with good credit.

So, if you have bad credit, you may have difficulty getting authorized for a line of credit – or earning favorable interest rates if approved. While it is receiving a line of credit with a low credit score may be possible, that doesn’t imply you should. There may be other possibilities for you, such as a secured line of credit, a personal loan, or an alternative payday loan; however, some of these solutions may have significant negatives. 

What is a line of credit?

A line of credit, if authorized, permits you to borrow money as needed up to a predetermined amount. If you borrow money from a line of credit, you will make payments and pay interest on the outstanding balance.

Some lines of credit charge annual fees or a fee each time you borrow, so read the terms and conditions carefully before applying. Credit lines are similar to credit cards. You’ll have a credit limit, monthly minimum payments, and interest based on your outstanding balance.


However, with a bank or credit union-approved line of credit, you usually borrow money by writing a check or electronically putting funds into your checking account rather than using a credit card. Banks and credit unions are the most common providers of credit lines. You must first become a member if you want to apply with a credit union.

Pros and cons of a bad credit line credit

Getting a line of credit has its advantages and disadvantages.

Pros of getting a line of credit

You can receive cash when you need it, up to a specific amount, if you already have a line of credit. This is why it may be worthwhile to apply for a line of credit even if you are still determining when or if you will use the funds. Instead of waiting and asking for a loan later when you realize you need the money, if you already have a line of credit, you may be able to get it on the same day.