Best personal loans of January 2024
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Whether you're looking to consolidate high-interest debt, or cover unexpected expenses, a personal loan can simplify your debt by allowing you to combine it all into one source with fixed monthly payments. Here are some of the best personal loans you can choose from if you're looking to borrow some funds.
Overview of best personal loans in 2024
Best overall: SoFi
Quick Facts
Minimum credit score: None
APR range: 8.99% to 25.81% (Including up to 0.50% discounts)
Loan amounts: $5,000 to $100,000
Loan term: 24 to 84 months (2-7 years)
Why we like SoFi
SoFi ranks as our best overall personal loan provider due to competitive pricing, discount opportunities, fast funding, and borrower protections. Their loans range from $5,000 to $100,000, with two to seven-year repayment terms. Interest rates range from 8.99% to 25.81% after applying discounts.
SoFi is unique in offering ways to reduce your interest rate further. For example, you can shave 0.25% off your loan interest rate by establishing autopay. This extends to another 0.25% with money direct deposits into a SoFi Plus checking account. However, the deposit limit must exceed $1,000.
When it comes to fees, SoFI is also a preferred option. They charge an optional origination fee to help you decrease your lifetime loan interest rate. Otherwise, they have no late or prepayment fees.
Beyond loans, SoFi provides helpful services to improve your financial health. This includes unemployment protection, one-on-one career coaching, financial advising, estate planning discounts, and a handy mobile app.
SoFi’s services are available to all American states. They receive great reviews quoting user friendliness and a fast loan process. SoFi receives a 4.7 on Trustpilot with over 7,000 reviews.
Applying for a loan on SoFi
SoFi doesn’t state a specific credit score requirement for applicants. Instead, they take a holistic approach to reviewing loan applicants. They’ll look at a mix of your income, debts, and credit history. Your overall creditworthiness will impact your final interest rate. Their firm requirement is the borrower must be of the age of majority in their state and have a verifiable source of income.
You can pre-qualify on SoFi’s website for a proposed rate in 60 seconds or less. This lets you see your loan details without impacting your credit score. Choosing to accept the loan will then perform a hard credit check.
SoFi also allows users to apply with a co-applicant. However, this takes an additional one to two weeks to review. If approved in your application, SoFi offers same-day funding.
Best for longest repayment terms: Lightstream
Quick Facts
Minimum credit score: 650
APR range: 7.99% to 25.49% (With Autopay 0.5% discount)
Loan amounts: $5,000 to $100,000
Loan term: 24 to 144 months (2-12 years)
Why we like LightStream
LightStream stands out for borrower-friendly conditions. One of the biggest reasons is their highly competitive interest rates, starting at just 7.49% APR. They offer a rate discount of 0.5% if borrowers sign up for automatic payments from their bank account. Their rate beat program will also beat any competitor's interest rate by 0.1 percentage points if you show you were approved for the lower interest rate.
In addition to low rates, they don't charge any fees. For example, LightStream doesn’t charge origination, late payment, or prepayment fees. Furthermore, they offer the most flexible term lengths up to seven years on unsecured loans. Otherwise, you can extend to 12 years by collateralizing your boat, RV, or aircraft. While extended payback periods reduce your monthly payment, you’ll also pay more lifetime interest.
LightStream lives up to its name by funding you seemingly at the speed of light. Their rapid funding process is available in all States, sometimes even providing same-day funding. Many past customers praise their helpful, responsive support staff and easy-to-use online loan portal, which has a score of 3.1 and 315 reviews on Credit Karma.
One drawback to some customers is that Lightstream only approves users with a “good to excellent” FICO score. Although no specific credit score is required, "good to excellent" translates to 650 and up. A credit score in this range will increase your chances of getting approved for a loan and allow you to get more favorable interest rates.
Applying for a loan on LightStream
LightStream does not offer a pre-qualification process. This means you must submit a formal application to see your interest rate. As such, a hard credit check will impact your credit score, although the hit is typically minimal.
LightStream will ask if you want to submit a joint or individual loan application. The joint applicant increases flexibility, allowing you to apply with a joint income and someone with a stronger credit profile. This can result in approval for a higher loan amount and a better interest rate. Notably, your joint applicant doesn’t need to live at the same address as you, distinguishing LightStream from other lenders.
This shouldn’t be confused with a co-signer who will back up the loan if you default. LightStream doesn’t offer co-signing.
Best for fair credit: Upgrade
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Quick Facts
Minimum credit score: 560
APR range: 8.49% to 35.99%
Loan amounts: $1,000 to $50,000
Loan term: 12 to 84 months (1-7 years)
Why we like Upgrade
Upgrade is ideal for borrowers with fair or poor credit who need access to smaller loans. While not a direct lender themself, they’ve created a marketplace that connects borrowers to lenders like banks and credit unions. Their interest rates range from 8.49% to 35.99% APR, but lower rates are given to borrowers with automatic payments.
Upgrade offers personal loans ranging from $1,000 to $50,000. Compared to alternatives, their origination fees are high, ranging from 1.85% to 9.99%. However, higher fees are common across loans for fair credit scores. The fees are deducted upfront from your net loan proceeds.
Despite higher origination fees, the lack of prepayment penalties is a nice feature. This means you can pay off your loan faster to save on interest. Upgrade also offers a helpful debt consolidation service that automatically pays your creditors when taking a loan with them. There is also a $200 welcome bonus if you open a Checking account and deposit at least $1,000 within 45 days.
Otherwise, Upgrade's mobile app makes it easy for users to manage their loans. It also provides an autopay discount and a credit monitoring program. Upgrade gets great reviews stating fast funding, good customer service, and an easy application process. It has a 4.5-star rating with 39,908 reviews on Trustpilot.
Applying for a loan on Upgrade
Upgrade allows you to pre-qualify by entering a loan amount and purpose. You must then choose between a joint or individual application and enter personal information to create an account. Upgrade may offer secured loans for a lower rate, depending on your application. However, they commonly focus on unsecured loans.
Qualified borrowers are shown multiple offers with different rates and terms. Only a soft credit check is performed at this stage. This lets you check rates without impacting your credit score. After finding a loan that suits you, Upgrade will perform a hard credit check. Once approved, funds typically arrive within one day.
Best for debt consolidation: Lending Club
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Quick Facts
Minimum Credit Score: None
APR range: 9.57% to 35.99%
Loan amounts: $1,000 to $40,000
Loan term: 25 to 60 months (2-5 years)
Why we like Lending Club
Lending Club is a peer-to-peer lending platform that offers personal, business, and auto loans. They offer loans ranging from $1,000 to $40,000, with APRs ranging from 9.57% to a steeper 35.99%. Like Upgrade, Lending Club charges an origination fee of 3-8%. Their fees vary with your amount and creditworthiness.
Lending Club also has no prepayment penalty. They offer a 15-day late payment grace period but don’t list fees for missing this window. Their term lengths are standard, between two to five years, allowing payment flexibility. Their debt consolidation service is a nice touch, paying off your creditors directly. Users describe the online application process as quick and easy, with a Trustpilot rating of 4.7 and over 5000 reviews.
Applying for a loan on Lending Club
Lending Club offers joint and individual loans. They’ll review your income and credit history to determine your overall eligibility. As such, there is no specific minimum credit score. A soft credit inquiry is performed in this process, which does not affect your credit score.
After pre-qualifying, you’ll receive an APR and loan terms. If you proceed, Lending Club will then perform a hard credit check. If approved, you will typically receive funds within a few days.
Best for small loan amounts: PenFed Credit Union
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Quick Facts
Minimum credit score: None
APR range: 7.99% to 17.99%
Loan amounts: $600 to $50,000
Loan term: 12 to 60 months (1-5 years)
Why we like PenFed
PenFed Credit Union offers unsecured personal loans ranging from as low as $600 to $50,000. The maximum length for a loan is 60 months, and the APR ranges from 7.99% to 17.99%. While you don’t need to become a credit union member to apply, it’s required to receive funding. Another benefit is their speed of funding, at just one to two business days.
PenFed doesn't charge origination or early payoff fees, though a late fee of $29 is charged if payments are more than five days late.
Customer reviews are positive, with users commenting on a quick and easy process. PenFed has a rating of 4.4 on TrustPilot with almost 1500 reviews.
Applying for a loan on PenFed
To qualify, the borrower must be of the age of majority in their state, have a verifiable source of income, and a suitable credit score. When applying for a loan from PenFed, you must enter the amount, term length, and use of funds. Additionally, this includes personal information if you aren’t yet a member.
You will then get pre-qualified for an interest rate with a soft credit check performed. If you are happy with the terms and proceed, you will get a hard credit check.
Borrowers should be aware that they must submit a minimum payment of at least $50 a month. The company encourages applicants to have a co-borrower to improve their chances of getting a loan. PenFed Credit Union does not offer refinancing options for existing personal loans.
Best for in-branch service: Wells Fargo
Quick Facts
Minimum credit score: 630-850
APR range: 7.49% to 23.24%
Loan amounts: $3,000 to $100,000
Loan term: 12 to 84 months
Why we like Wells Fargo
Wells Fargo is the 4th largest bank in the USA, with national branches offering personal and business banking services. They offer amongst the lowest rates from a major bank, with APRs starting at just 7.49%.
The caveat is that you need to be an existing Wells Fargo customer for at least 12 months to access a personal loan from the bank. Wells Fargo stands out compared to the others on the list if you want an in-branch experience.
If you are an existing client, Wells Fargo offers a wide range of loan amounts from $3,000 to $100,000. Whether you need to cover a small expense or a large project, they can accommodate your borrowing needs with terms of up to seven years. Wells Fargo doesn’t charge origination fees or prepayment penalties, but there is a late payment fee of $39 after a ten-day grace period on loans.
Applying for a loan on Wells Fargo
To apply for a loan, you must be an existing customer for at least 12 months. If you would like to apply for a loan down the road you can open an account at one of the many branches across the country.
For existing customers, Wells Fargo can pre-qualify you for a personal loan with a soft credit check after you fill out the application. They'll perform a hard credit check if you are happy with the terms. If approved, you’ll receive funds in one to three business days.
Best for little or poor credit: Upstart
Quick Facts
Minimum credit score: 300
APR range: 6.40% to 35.99%
Loan amounts: $1,000 to $50,000
Loan term: 36 to 60 months (3-5 years)
Why we like Upstart
Upstart stands out for approving applicants across the full credit spectrum. Despite funding individuals with low credit scores, they don’t partake in predatory practices that are common in this niche. A major advantage is Upstart considers factors beyond your credit score, like your education, employment history, and income potential. This gives borrowers with limited credit history a chance at being approved.
Upstart's minimum credit score of just 300 opens doors for borrowers most lenders overlook. You can borrow up to $50,000 based on your qualifications, with competitive rates despite less stringent credit requirements. However, Upstart charges high origination fees of up to 12%. The fees are deducted from your loan amount.
You’ll need to pay late fees if missing your payment by more than ten days. Upstart charges the greater of 5% of the past due balance or $15. Fortunately, they don’t charge prepayment penalties, meaning you can repay the loan whenever desired.
The reviews on Upstart are positive, as users say it was a quick and transparent process with great customer service. On Trustpilot, it received a 4.9 with 45,168 reviews.
Applying for a loan on Upstart
Thanks to an easy online process, getting a personal loan through Upstart is simple and convenient. You can check your rate online in five minutes without impacting your credit. Upstart customizes offers based on your credit, income, employment, and other details.
Your debt payments must not exceed a certain percentage of your income to get approved. Additionally, you can't have any recent bankruptcies, public records, or delinquent accounts.
Many applicants receive instant approval without paperwork. At this stage, only a soft credit check is performed. However, as usual, you must complete a hard credit check to finalize funding. Once approved, you’ll usually receive funding within one business day.
Best for next-day funding: Discover
Quick Facts
Minimum credit score: 660
APR range: 7.99% to 24.99%
Loan amounts: $2,500 to $40,000
Loan term: 36 to 84 months (3-7 years)
Why we like Discover
Discover stands out with great rates, flexible repayment, and low fees. They’re an ideal option for cost-sensitive borrowers. Their interest rates are low, starting at just 7.99% APR for borrowers with excellent credit.
They’re also competitive with fees. You won’t have to pay an origination fee or penalty for early repayment. However, there is a $39 late payment fee after their due date. Another benefit is repayment flexibility, with three to seven-year terms. You can customize your term length to create affordable monthly payments that fit your budget and needs.
Key additional features include FICO credit score access and a debt consolidation service. Lastly, with the next-day funding options, Discover ensures swift access to financing exactly when required.
The reviews are mixed, with many users complaining about their credit cards. Discover scores 1.8 on Trustpilot with 241 reviews, most of which do not relate to personal loans.
Applying for a loan on Discover
Discover’s online loan calculator kick-starts the application process. You’ll receive an estimated interest rate by experimenting with the loan amount, term length, and credit score. You can then submit an online application where you must provide personal information. This includes income and employment verification, bank details, and creditor information.
Alternatively, you can pre-qualify by calling an agent. Similar to online applications, this process performs a soft check. You’ll eventually need a hard check to finalize funding. Regardless, approval decisions are communicated promptly.
The terms outline your APR and loan amount before acceptance. Funds are then dispersed as soon as the next business day. They can be directly deposited into your account or sent to creditors for debt consolidation. Discover does not offer co-sign or joint loan applications; you can only apply individually.
Best for credit card debt consolidation: Happy Money
Quick Facts
Minimum credit score: 640
APR range: 11.72% to 17.99%
Loan amounts: $5,000 to $40,000
Loan term: 24 to 60 months (2-5 years)
Why we like Happy Money
Happy Money stands out for consolidating credit card debt. Their Payoff Loan™ is designed to simplify the process. Their rates start at 11.72%, higher than alternatives but much lower than credit card interest rates. While their fees are transparent, Happy Money charges an additional 1.5% to 5.5% origination fee.
Their reviews are overall positive. Many users express satisfaction with the service's effectiveness in reducing their credit card debt. Happy Money receives a 3.9 on Trustpilot with 375 reviews.
Applying for a loan on Happy Money
As usual, you’ll be asked for personal information and loan details. This includes your desired loan size and term length. During this phase, Happy Money will perform a soft credit check to qualify you without impacting your credit score.
After pre-approval, you’ll receive a final confirmation with documentation to sign. Afterward, you’ll receive funding within three to six business days. Notably, joint accounts or co-signed loans are unavailable with Happy Money.
Best for large loan amounts: BHG Money
Quick Facts
Minimum credit score: 660
APR range: 13.39% to 24.91%
Loan amounts: $20,000 to $200,000
Loan term: 36 to 120 months (3-10 years)
Why we like BHG Money
BHG Money caters to the high rollers. They’re ideal for taking out larger loans since you can receive up to $200,00 in funding. As such, they’re a great choice for financing major expenses, like home renovations.
Another advantage is the flexible loan terms, ranging from three to ten years. This helps reduce monthly payments when taking out larger loans. However, this increases your lifetime interest owed. While rates are a bit higher than some other lenders, the large loan sizes and extended terms make it one of the best lenders.
BHG is unclear about origination and late fees, but there is no prepayment penalty. The lack of prepayment penalties is a nice touch if working on home renovations. After your project, you can seamlessly refinance into a lower rate through your enhanced home equity.
Customers speak about their experience being professional, straightforward, and quick. The company is rated 4.7 on Trustpilot with over 3,000 reviews.
Applying for a loan on BHG Money
BHG’s personal loans are available nationwide, except in Illinois and Maryland. There is no hard credit check to apply. Simply enter basic personal information and your desired loan size. From there, you will hear back within 24 hours. If approved, it can take five days to receive funding.
Compare personal loan rates
What is a personal loan?
A personal loan is an installment loan that you can use for almost any purpose. They’re widely used to finance large purchases, significant life events, medical expenses, debt consolidation, home improvements, and more.
You’ll receive a lump sum payment, which you repay in predictable monthly installments. The monthly payments commonly last one to seven years, after which you’ll fully pay it off. Personal loans normally don’t require collateral and are offered with fixed interest rates. While interest rates and qualifications vary by lender, they commonly consider your income, debts, and creditworthiness. Most lenders review a variety of factors to determine your final interest rate.
How do personal loans work?
When you take out a personal loan, the lender provides the full loan amount as a lump sum. You are then responsible for repaying the amount with interest. The payments are commonly fixed monthly installments over a set term length.
The interest rate, fees, loan term, and other loan details are agreed upon upfront when you take out the loan. Each monthly payment contributes to the principal amount and interest owed. As you make payments over time, the principal balance is reduced.
You can get personal loans from banks, credit unions, online lenders, and other financial institutions. The lender will review your credit, income, and other credentials to determine your interest rate and eligibility.
It's important to note that personal loans usually come with fees, such as origination fees and prepayment penalties, so be sure to read the terms and conditions carefully before accepting any loan offer.
Taking out a personal loan means borrowing money and will have to repay it over time. Be sure only to borrow what you can reasonably afford to repay.
What are the easiest loans to get approved for?
If you need money quickly and have less-than-perfect credit there are options. While easier to qualify for, these loans should be used cautiously as a last resort due to the high costs and risks involved.
- Payday loans: Payday lenders offer small, short-term loans with minimal credit checks. However, the fees and interest rates are extremely high.
- Pawn shop loans: You can get a pawn shop loan by providing collateral like jewelry or electronics. No credit check is required, but you risk losing your possessions if you can't repay the loan.
- Cash advances: Options like paycheck advances from your employer or cash advance apps provide smaller amounts of fast cash but also charge high fees.
- Secured personal loans: Putting up collateral for a secured loan is easier to get approved for, but you risk losing your collateral if you default on payments.
Tips for comparing personal loans
Not all personal loans are created equal. If you've decided a personal loan is right, shop with multiple lenders for the best deal. Consider the following factors:
- Interest rates: The interest rate significantly impacts the overall cost of borrowing. Compare both the annual percentage rate (APR) and monthly interest rate. The lower, the better.
- Fees: Many lenders charge origination, application, and late fees. These fees can make borrowing very costly upfront. Origination fees are commonly high and worthwhile to keep an eye out for.
- Loan term: This is the payback period of your loan. While longer terms are tempting with reduced monthly payments, you’ll have a higher overall interest cost. Opt for the shortest term you can comfortably afford.
- Prepayment policies: Many personal loans allow you to pay off the balance early without penalty. This provides flexibility if you come into extra cash.
- Qualification requirements: Each lender has different approval standards. While they commonly review your credit score and income, they may have varying weights on their significance. Many lenders offer pre-qualification, so you can see your interest rate before formally applying.
- Funding time: Online lenders often fund loans within a week, while banks may take longer. Consider your timeline.
- Additional features: Some lenders may offer additional features, such as deferred payments, unemployment protection, and help with debt consolidation. These can be helpful in times of financial hardship.
Common types of personal loans
Secured loans
A secured loan decreases the lender’s risk, and your interest rate as a result. This is because you’ll need to provide collateral like your home equity or car. Consistently failing to make payments results in the lender seizing your collateral to pay off your loan.
- Pros: Lower interest rates, larger loan amounts available
- Cons: Risk of losing collateral if you default, application process takes longer, higher origination fees
- Examples: Home equity loans, auto equity loans, certificate of deposit secured loans
Unsecured loans
An unsecured loan doesn’t require collateral to obtain financing. This makes them faster to qualify for but comes with higher interest rates. The lender can’t seize your assets with missed payments, but they’ll charge fees. Furthermore, it will damage your credit score.
- Pros: Faster approval, retain ownership of your possessions
- Cons: Higher rates and stricter qualification standards
- Examples: Traditional personal bank loans, online personal loans, credit union personal loans
Payday loans
Payday loans provide fast cash against your next paycheck. Interest rates are sky-high, while fees can add up quickly. Eighteen states, including New Jersey and Massachusetts, no longer allow payday loans.
To qualify for one, you must typically provide proof of income. The institution will then lend you a portion of the money you will be paid, and give you around 30 days or less to pay it back. Most loans have a limit of around $500.
Since payday loans don’t typically require a look at your credit history, the lenders take on more risk when they give you money. The high fees are the lender’s way of offsetting that risk. The average APR range is around 400%, with some charging as high as 780%
- Pros: Immediate access to cash, minimal qualification requirements
- Cons: Extremely high APRs, short repayment terms, roll over fees
- Examples: Storefront payday loans, payday advance apps, and websites
Personal line of credit
A personal line of credit provides flexible access to funding. Like a credit card, you receive a pre-approved limit you can draw from when needed. You’ll only pay interest on the portion used. It contrasts a standard personal loan, that provides a lump-sum payment upfront and immediately incurs interest.
Banks and credit unions typically offer this type of loan to members with a credit score exceeding 700. The line of credit's limit will also depend on your credit score and income.
A personal line of credit can be a good debt consolidation option. Many banks allow you to transfer a credit card balance to a credit line, which may reduce your interest rate. If your line of credit limit is high enough, it can be an alternative to a loan from a third party.
- Pros: Pay interest only on what you borrow, can reuse funds
- Cons: Variable rates, lower borrowing limits, higher credit score required
- Examples: Personal revolving lines of credit from banks or credit unions
Alternatives to a personal loan
- Credit card balance transfer: If you have high-interest credit card debt, you may be able to transfer your balance to a card with a lower interest rate. This can help you save money on interest charges and pay off your debt more quickly.
- Home equity loan or line of credit: If you own a home, you may be able to take out a home equity loan or line of credit to borrow money. These loans typically have lower interest rates than personal loans, but your home serves as collateral.
- Borrowing from friends or family: If you have a good relationship with someone who is willing to lend you money, this can be a good option. However, it's important to treat this type of loan like any other loan and make sure you can repay the money on time.
- Retirement account loan: If you have a retirement account, such as a 401(k) or IRA, you may be able to borrow money from it. However, this can be risky, as you may have to pay taxes and penalties if you don't repay the loan on time.
- Payday alternative loans: Some credit unions offer payday alternative loans, which are small, short-term loans designed to help people avoid payday loans. These loans typically have lower interest rates and fees than payday loans.
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