Key Takeaways
- A $400 loan can provide fast financial relief for unexpected expenses, and is accessible even with bad credit, though it’s important to compare options and understand the repayment terms.
- Payday loans offer quick approval and minimal requirements but often come with high interest rates, rollover risks, and added fees that can escalate debt if not repaid promptly.
- Installment loans or personal loans can serve as smarter, easier options for people who need a $400 loan.
- The borrower’s credit is a key factor in loan approval and terms, influenced by payment history, credit utilization, credit mix, and new credit inquiries.
- Before taking a $400 loan, consider whether it’s a true necessity, explore safer alternatives like installment loans, and ensure you have a realistic repayment plan to avoid financial strain.
Get a $400 loan by applying online with lenders that offer small personal loans, installment loans, or cash-advance options, even if you have bad credit. Many online lenders, including CreditNinja, offer fast approvals, and you could receive your money as soon as the same day.*
When cash is tight and time matters, knowing your loan options can help you cover the expense without making the situation harder than it already is.
This guide explains where to get a $400 loan, how to qualify with bad credit, and how to repay it responsibly.
Know Your Credit Score Before Applying with Direct Lenders
Before you apply for any $400 loan or cash advance, you must have a clear picture of your financial situation. And to do that, you must know your credit score.
A credit score is a number that provides a general indication of your creditworthiness based on the data of millions of other people. It is a formula that compares your credit information to the data of other consumers and tells lenders and creditors how likely you are to repay a loan or line of credit.
For the most part, everyone understands that good credit is better than bad credit, but many people don’t know where their scores come from, let alone what it is.
Five significant factors determine a consumer’s credit score:
Payment History
Your payment history records all the late and on-time payments you have made to your creditors, which is the most crucial part of your credit history. Lenders will use this information to determine if they will work with you. Even if your overall credit is poor, a decent payment history may make the difference in a loan decision. If reported to a collections agency, a late or delinquent payment can take as many as 100 points off a score. This is why it’s essential to pay bills on time, all the time.
Credit Utilization
Credit utilization is the percentage of a person’s available credit that they are using. Having credit readily available means that you can keep your debts under control. To illustrate credit utilization, let’s look at an example. Let’s say a person has a credit card with a limit of $1,000. At the end of a month, the balance on the card is 250 dollars. That means they have a credit utilization ratio of 25 percent. Good credit scores have utilization rates at 30 percent or below.
Credit History
Your credit history is a list of your past and current credit accounts, which will help creditors predict your future credit habits. A good credit history with positive accounts in good standing will help you get the best score possible.
New Credit
When you apply for a new credit line or loan, it’s not always a good idea to use other lines of credit at the same time. Doing so may make it seem as if you’re in some financial trouble, and therefore not a good candidate for a loan.
Credit Mix
A high credit mix is a sign of stability to creditors. An excellent example of a solid credit mix is a secured auto loan with a steady installment plan and an unsecured credit card with a revolving balance that varies from month to month. While a good credit mix is helpful, it is not weighed as heavily as the other factors.
Your credit score is a part of a financial profile called a credit report. Companies issue credit reports called credit bureaus that analyze an individual’s history with credit. The three major credit bureaus are Equifax, Experian, and TransUnion. They can provide a credit report on just about anyone who has ever rented a home, bought a car, or applied for a credit card or loan.
From that credit check, lenders can see your credit score—a three-digit number that ranges from 300-850. The higher the number, the better your creditworthiness:
Below is a breakdown of how credit ratings work:
| Credit Score Range | Credit Rating |
| 300-580 | Considered poor credit |
| 581-669 | Fair Credit |
| 670-739 | Good Credit |
| 740-799 | Very Good Credit |
| 800-850 | Excellent Credit |
It’s not always easy to know what a decent credit score is. A score of 580 or below is generally considered harmful. On the other hand, borrowers with good credit are seen as a lower risk to lenders, so they are more likely to get better interest rates and loan terms than bad credit.
Although there are more options available for someone with good credit, it’s not impossible to secure a $400 loan with poor credit.
The Dangers of Payday Loans
A payday loan, otherwise known as a quick cash loan, is a personal loan designed to provide a short-term solution for short-term cash problems. Payday loans are usually smaller in size than other types of personal loans. According to the Consumer Financial Protection Bureau (CFPB), the average lending amount is just $350.
With over 23,000 lenders in the US alone, A payday loan is a popular option because of its massive availability. You can either visit a brick-and-mortar payday loan store, use a mobile app, or visit a website to apply for one.
Payday loans can be a quick and easy solution to financial troubles. But you need to pay them off quickly to avoid the high interest and fees. If you have poor credit, higher rates, and shorter terms (like those found in payday loans), you will want to consider a solid repayment plan and stick to it; otherwise, you may find yourself caught in a cycle of debt that is difficult (and expensive) to get out of.
Even though $400 is a small loan, it is never a good idea to blindly enter into a loan agreement. Instead, make sure you review your contract to know what is expected of you from your first installment payment to the last.
Safer Alternatives for a 400 Dollar Loan
Thankfully, there are plenty of safe and affordable alternatives you can turn to when you need a quick $400 loan. Some of the most common loan alternatives for quick cash loans include personal loans and bad credit installment loans. Lenders like CreditNinja specialize in loan products designed for people with less-than-perfect credit, no credit, and those looking to build/improve their credit.
Personal Loans for $400
CreditNinja personal loans are short-term personal loans that come with benefits like:
- Same-day funding*
- Flexible repayment
- Online application and repayment
- Affordable payments
Installment Loans for $400
Installment loans are a type of personal loan that can be used for just about any financial emergency, such as debt consolidation, medical debt, or unexpected costs. Borrowers can access installment loans via banks, credit unions, or direct online lenders. For example, CreditNinja offers installment loans ranging from $300 – $5,000, making them well-suited for a variety of expenses.
$400 Loan FAQ
Do I need an active bank account to get a $400 loan?
Not all direct lenders require that borrowers have an active bank/checking account in order to receive loan approval. However, having a checking account allows lenders like Credit Ninja and others to submit your approved loan funds via direct deposit, which is typically the fastest way to get your loan money.
What is a direct lender?
A direct lender is a financial institution that directly provides loans to borrowers without the involvement of any intermediaries or brokers. Credit Ninja is an example of a direct lender. This means that the borrower deals directly with the lender throughout the loan approval process.
What is a loan request form?
A loan request form is a document that a borrower fills out to apply for a loan. It typically requires personal information, employment details, and financial data. The information provided is used by the lender to determine the borrower’s eligibility for the loan.
Can I get a $400 loan with poor credit?
Yes, bad credit loans and some short-term installment loans are available to people with poor credit, or even no credit at all. The key to finding a $400 loan with poor credit is finding the right lender. Look for online lenders that have verified customer reviews, easy loan apps, transparent terms, and flexible repayment options.
What is a soft credit check?
Soft credit checks are a type of credit inquiry that does not affect your credit. It’s typically used for pre-approvals and initial eligibility checks. Some payday lenders may perform soft credit checks during the loan approval process.
What is an installment loan?
An installment loan is a type of loan where you borrow a specific amount of money and pay it back in a series of regular loan payments, or installments, over a set period. These loans are typically offered by traditional lenders like banks or credit unions.
What are the eligibility criteria for a $400 loan?
Eligibility criteria can vary by lender, but typically include being at least 18 years old, having a valid government-issued ID, an active email address and phone number, a valid bank account, and proof of income (You can often prove income with documents like a paystub or bank statement). Even with poor credit, you may still be eligible for a $400 loan.
What is the loan approval process like?
The loan approval process typically involves filling out a loan request form, after which the lender will review your application. They may perform a soft credit check and verify your income. Keep in mind that the credit score needed for a personal loan can vary by lender. If approved, you can expect funds deposited directly to your checking account. The process can be quick, often within a few hours or the next business day.
A Note From CreditNinja
Before you get a $400 loan or other short term loan online, make sure you consider all your available options! It may be more convenient in the long run to dip into your own savings, ask a close friend or family member for a small loan, or even organize your budget to free up some extra cash.
If you ultimately decide that a $400 loan is the right choice for you, be sure to research your available options. Direct lenders like CreditNinja seek to be a more affordable alternative to quick cash advances, especially for borrowers who have poor or bad credit. Fill out our quick online form and see how much you could get approved for today!
References:
- People with perfect credit scores have 3 key traits in common, Experian reports
- What Is a Payday Loan and How Does It Work?
- How Do Payday Loans Work
