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Personal loans allow you to borrow money for just about any purpose. This type of loan usually offers flexibility, but borrowing costs can vary based on your credit history and the lender you choose. Most personal loans don’t require any form of collateral or security deposit. However, late and missed payments show up on your credit report and can lower your credit score.
The best personal loans offer simple, straightforward application processes. They also feature low interest rates and low fees for qualifying borrowers. Plus, they usually carry no prepayment penalties if you want to pay your balance off early.
Best Personal Loans of 2022
Best Overall and Best for Low or No Fees : SoFi
- APR: 5.74% - 21.78%
- Days To Receive Loan: 0 Days
- Loan Amount: $5,000 - $100,000
SoFi offers personal loans up to $100,000 with competitive APRs, flexible repayment terms, and funding as soon as the same day. Unlike many of its competitors, SoFi doesn’t charge any fees for its personal loans, not even late fees.
Borrowers can pre-qualify for loans
Loans are available in 49 U.S. states
Option to refinance personal loans
Loans less than $5,000 aren’t offered
Fairly high minimum credit score requirement (650)
SoFi is our choice for the best overall personal loan lender and best for no fees. Its current APRs are competitive, ranging from 5.74% to 21.78% (including a 0.25% autopay discount.) Furthermore, you can get loans ranging from $5,000 to $100,000 with repayment terms of 24 to 84 months and same-day funding. While SoFi’s minimum loan amount is relatively high—some competitors offer loans as small as $250—its loans can be used for almost any purpose, and are available in 49 U.S. states, excluding Mississippi.
Additionally, borrowers won’t pay any fees for personal loans from SoFi. Many lenders charge origination fees and late fees, but SoFi doesn’t charge either. Plus, there are no prepayment penalties, so borrowers can choose to pay off their loans early without incurring charges.
To qualify for a personal loan from SoFi, you’ll need to be a U.S. citizen, permanent resident, or eligible visa holder who's at least 18 years old (or the age of majority in your state). You’ll also need to live in one of the 49 states where SoFi personal loans are available. You’ll also need a minimum credit score of 650 and a job, income from other sources sufficient to repay your loan, or a job offer that will start in the next 90 days.
Read our full SoFi personal loans review.
Best for Debt Consolidation : Discover
- APR: 5.99% - 24.99%
- Days To Receive Loan: 1 Days
- Loan Amount: $2,500 - $35,000
Discover personal loans have competitive rates, flexible repayment terms, and can be used to consolidate many types of debt. In many cases, Discover will also pay your creditors directly, which helps streamline and simplify the repayment process.
No origination fees
Excellent customer satisfaction ratings
Same-day decision for most applicants
Credit score requirements not disclosed
Must have $25,000 or more annual income
We chose Discover as our top pick for debt consolidation as its personal loans can be particularly good for consolidating high-interest debt. There are no restrictions on the loans, and you can use loan proceeds to consolidate many types of debt including high-interest credit cards, loans, medical expenses, and more. Depending on which debts you’re consolidating, Discover may also pay your creditors directly, which can save you time and simplify the repayment process.
Discover offers loans of $2,500 to $35,000 with current APRs from 5.99% to 24.99% and repayment terms of 36 to 84 months. It also doesn’t charge origination fees, although borrowers will pay a $39 fee for late payments. Personal loans from Discover are available in all 50 states, and Discover has an excellent reputation with its customers and is a top-ranked lender on the 2021 J.D. Power 2021 U.S. Consumer Lending Satisfaction Study.
Discover offers a simple online loan application, and approval is often granted the day you apply. To be eligible for a personal loan, you must be a U.S. citizen or legal permanent resident who's at least 18 years old (or the age of legal majority in your state) and has at least $25,000 in annual income. Note that while Discover doesn’t share its credit score requirements, you’ll likely need good credit to qualify.
Read our full Discover personal loans review.
Best for Small Loans and Best for Bad Credit : Upgrade
- APR: 5.94% - 35.97%
- Days To Receive Loan: 1 Days
- Loan Amount: $1,000 - $50,000
While some providers have high minimum loan amounts, Upgrade offers loans as small as $1,000. Plus, eligible borrowers with credit scores as low as 550 may be able to get approved for a loan.
Pre-qualification option available
Low minimum credit score requirement
Next-day funding offered
High origination fees
No option to refinance personal loans
Upgrade offers personal loans as small as $1,000, which is a small loan amount compared to many competitors whose minimum loan amounts may start as high as $5,000. Its maximum loan amount is $50,000 and eligible borrowers with less-than-stellar credit may also qualify for a loan, as the minimum credit score requirement is 550. Many lenders have higher minimum credit score requirements to qualify for a loan, so Upgrade’s lower credit score requirement is a plus. Its personal loans are also available to borrowers in 50 states but aren't available in Washington, D.C.
In addition to its low minimum loan amounts, low credit score requirements, and wide availability, Upgrade also offers next-day funding and a low minimum APR of 5.94% for qualified borrowers. However, Upgrade’s current maximum APR of 35.97% is fairly high compared to other lenders. Typically, if your credit is poor, the rate you’ll likely receive for a loan may be higher, so the 35.97% maximum APR is something to keep in mind if you’re considering a personal loan from Upgrade.
Also, unlike some competitors, Upgrade charges relatively high origination fees ranging from 2.90% to 8.00%, which are deducted from loan funds at disbursement. This means that the total loan amount you’ll receive will be slightly lower than the amount you applied for once the origination fees are deducted. But despite its origination fees, Upgrade is still a good option for borrowers with lower credit scores who want to borrow a relatively small amount.
Read our full Upgrade personal loans review.
Best for Quick Funding : Rocket Loans
- APR: 5.97% - 29.99%
- Days To Receive Loan: 0 Days
- Loan Amount: $2,000 - $45,000
If you need money quickly, Rocket Loans is a great option as it offers same-day funding and may even approve borrowers with less-than-perfect credit.
Same-day funding available
Starting APRs (with autopay discount) are low
Has origination fees of up to 6%
Only two repayment term options (36 or 60 months)
Not only does Rocket Loans offer personal loans of $2,000 to $45,000 to applicants with good and bad credit alike, but you might also be able to get funded on the day you apply. Many lenders disburse loan funds in one to three days, making same-day funding an excellent feature. Rocket Loans offers repayment terms of 36 or 60 months, and even though you’ll pay origination fees of 1% to 6%, its current APR range of 5.97% (including an autopay discount) to 29.99% is competitive.
To qualify for a personal loan from Rocket Loans, you need to be a U.S. citizen or permanent resident, live in one of the states where it offers loans (Iowa, Nevada, and West Virginia are excluded), and be at least 18 years old (or 19 years old in Alabama and Nebraska). Once you apply, Rocket Loans will evaluate several factors to determine if you’re approved for a loan, including your credit score, income, and existing debt.
Read our full Rocket Loans personal loans review.
Best for Service Members : Navy Federal Credit Union
- APR: 7.49% - 18.00%
- Days To Receive Loan: 0 Days
- Loan Amount: $250 - $50,000
Navy Federal Credit Union offers a competitive personal loan to service members of all military branches, along with qualifying family members. Plus, you can get long repayment terms of up to 180 months.
Same-day funding available
Long repayment terms up to 180 months
Must be a credit union member
Has late payment fees
Starting APR is slightly high
Navy Federal Credit Union offers personal loans for qualifying applicants, its online application can be completed in minutes, and borrowers may also get same-day funding. Plus, its current APR range of 7.49% to 18% is competitive, it offers flexible repayment terms ranging from 36 to 180 months, and its loan amounts range from a low of $250 up to $50,000. While Navy Federal doesn’t charge origination fees, you’ll be required to pay a $29 fee if you make a late payment.
You need to be a Navy Federal Credit Union member to apply for a personal loan. Even so, it's easy to apply for membership, which is broadly available to current and retired members of the U.S. armed forces and their qualifying family members, members of their household, employees of the Department of Defense, and more.
Read our full Navy Federal Credit Union personal loans review.
Compare the Best Personal Loans of 2022*APR ranges for some companies include a discount for automatic payments or existing bank customers.
SoFi is our top choice for personal loans due to its competitive rates and terms, easy online application process, and lack of fees. However, if you don’t have good credit, you may get better rates by shopping around elsewhere.
Since nobody’s financial situation is the same, a single lender will not perfectly fit everyone’s needs. Given this, it’s essential to shop around to find the best lender for you. Check out this personal loan calculator to learn more about expected costs with SoFi or other lenders on our list.
Guide for Choosing the Best Personal Loans
Best Place to Get a Personal Loan
If you’re looking for a personal loan, some of the best places to get one are banks, credit unions, and online lenders. If you need funds quickly, choose a lender that offers a simple online application and fast funding. Many banks and credit unions allow you to apply online and get funding quickly, but you’ll generally need to have good credit to get approved. If you don’t have good credit, an online lender is usually a better option.
Should You Apply for a Personal Loan?
If you need funds to cover a large expense or want to consolidate existing debt, then you might consider applying for a personal loan. Personal loans are commonly used by people who need funding for a big expenditure, like paying for a wedding, covering emergency expenses, or making home improvements or repairs. Loan funds can also be used to consolidate higher-rate debt into a lower-cost fixed-rate loan.
Personal loans can be a good option for those who need immediate funding and can afford the monthly payments. However, you’ll pay interest on the loan, so it’s more costly to use loan funds than to cover the same expenses using cash. Even so, the APRs on personal loans are usually lower than the rates you’ll pay on credit card debt. So, if you need to choose between using credit cards or personal loans, the latter is often the better choice.
One of the other benefits of an unsecured personal loan is that you don’t have to pledge any collateral, like your home or car, to get the loan. This can save you money because you don’t have to pay for costs associated with the collateral, such as appraisal fees. Plus, you may be able to get the funds more quickly because there’s no collateral involved. So, if you need funds to make home improvements, like repairing your roof, building a new office, or adding solar, a personal loan can be the way to go.
Comparing Personal Loan Lenders
The most important things to consider when selecting a personal loan lender include the costs and terms of the loan, what it takes to apply, and how quickly you can get approved and funded. As you’re comparing personal loan lenders, pay close attention to these factors:
- APR and Fees: Personal loan rates and fees are the primary factors to consider before choosing a lender. Rates and fees are factored into the loan’s APR, which measures the annual cost of the loan. The better your credit, the lower the rate you’ll get.
- Repayment Terms: Shorter repayment terms result in higher payments and usually carry lower interest rates. This means you may reduce your overall borrowing costs by choosing the shortest possible repayment term. However, just make sure you can afford the monthly payments before applying.
- Application Process: It’s also important to consider the lender’s application process. You might want to get a loan at your local bank or credit union, which can be a great option. However, keep in mind that certain small lenders may not offer automated systems or online applications, making the application process more time-consuming. If you’d prefer to avoid applying in person, choose a lender that offers an online application.
- Approval and Funding Speed: The loan’s funding speed is often closely linked to the application process. Lenders that have online applications and automated processes are often able to get you funded more quickly. However, many of these lenders only approve borrowers with good credit. If you have blemishes on your credit, choose a lender with less stringent credit score requirements, like an online lender or a local bank or credit union that can make individual decisions based on your unique circumstances.
How to Get a Personal Loan
Once you’ve decided to get a personal loan, it’s time to get your paperwork in order and ensure your credit is in the best possible shape. Many lenders will start with a pre-qualification process, which involves pulling a soft credit check on you. To pre-qualify, you’ll need to provide some personally identifiable information (such as your Social Security Number and date of birth), income details, the reason you need the funds, the amount you want to borrow, and how long you need to repay the loan.
While pre-qualifying doesn’t guarantee you’ll be approved for a loan, it does let you see the rate you may receive. If you’re quoted for a high rate, you can work on repairing your credit before submitting a full application. Generally, the better your credit, the better the rate you’ll get.
If the rate is acceptable and you decide to move forward, you’ll then complete a full application. This will involve providing the lender with additional information, such as proof of income and details on your monthly debts. You’ll also undergo a hard credit check as part of the application process.
If you’re approved for the loan, the lender will provide you with details about the loan terms, including the rates, fees, and repayment terms. Pay close attention to this information to understand the details before accepting the loan. If you don’t understand the loan details, speak with a representative to get clarification before proceeding.
As soon as you’ve accepted the loan, the lender will send you the loan funds in the way you specified in your application. This can include directly depositing the funds into your bank account, sending the money to your creditors to pay off existing debt, or even writing you a check.
You’ll also learn how to manage your loan, such as by logging into an online portal or using a mobile app. This can be helpful, as you’ll understand how to make your monthly payments and where to go if you need help in the future.
Frequently Asked Questions
What Is a Personal Loan?
A personal loan is a predetermined amount of money given to an individual by a bank or private lender. It is usually unsecured and carries a fixed interest rate. The borrower must agree to the loan rate and terms and make on-time monthly payments until it is fully repaid. A personal loan can be used for several things, including paying off or consolidating debt, covering medical expenses, or making a large purchase.
How Do Personal Loans Work?
Personal loans work by lending a borrower money if they meet certain qualifications set by the lender. The money is paid back over time with interest. The borrower usually makes monthly payments of principal and interest to repay the loan. A personal loan is often a more affordable option than a credit card because the interest rate is usually lower.
How Much Do Personal Loans Cost?
Some of the fees associated with personal loans are origination fees, prepayment penalties, late fees, and administrative fees. However, not all lenders charge the same fees. It’s important to check with the lender before getting a personal loan. Despite what fees the lender charges, the largest cost is going to be what you’re paying in interest. The average interest rate for a personal loan is 9.09%.
What Are the Pros and Cons of Getting a Personal Loan?
If you're considering a personal loan, it's important to look at the pros and cons.
- Personal loans usually have lower APRs than credit cards.
- Your personal loan will be fully repaid over a short period, versus credit cards, which might never be repaid if you just make the minimum monthly payments.
- Interest rates are fixed on personal loans, meaning your rate will never change.
- Unsecured personal loans don’t require collateral, making them quicker and easier to get than secured loans such as home equity loans.
- You’ll have to pay interest and fees with a loan, costs you wouldn’t incur if you used cash.
- Short repayment terms translate into higher monthly payments, so it’s essential to ensure you can afford the monthly payment before getting the loan.
- If loan interest rates decrease in the future, you’ll be stuck with a higher interest rate until you pay off the loan or refinance it.
- Since unsecured personal loans don’t require collateral, they may have higher APRs than secured loans, loan amounts can be smaller, and you’ll likely need better credit to qualify.
How We Chose the Best Personal Loans
Our team evaluated 38 lenders and collected 1,520 data points before selecting our top choices. We weighed more than 20 criteria and gave a higher weight to those with a more significant impact on potential borrowers.
The top picks were selected based on factors like membership requirements (weighted 15%), average fixed APR (weighted 15%), and average origination fees (weighted 10%).
We also took into account the flexibility of repayment terms, helpful features like pre-qualification, and whether a co-signer or joint applications are permitted to ensure borrowers get the best possible experience. For further information about our selection criteria and process, our complete methodology is available.