Some of the best places to get a personal loan
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Type “personal loans” into any search engine and you will get likely over a billion results. Even if only half a percent of those results are actual lenders, that’s an amazing amount of information to work through when pursuing a personal loan.
Whether you want a debt consolidation personal loan or want to stretch the cost of a large purchase over several months, choosing the right lender is crucial – and challenging. Different lenders offer different interest rates and terms that can add up to hundreds or even thousands of dollars of difference in the total cost of a loan.
Let’s take a look at some of the best places to get a personal loan and what you should know about each option.
Where can I get a personal loan?
Personal loans come from four main categories of financial institutions:
- Banks: Not all banks offer personal loans, but there are some that do.
- Credit unions: You must be a member of one of these non-profit institutions in order to receive a personal loan from them.
- Online Lender: It can be easier to qualify for a loan through one of these virtual non-banking organizations.
- Peer-to-Peer Lenders: Private investors lend money directly to borrowers via an online platform.
Each lender has their own set of requirements to qualify for a personal loan, and it can be difficult to see what your chances of approval are on a lender’s website. You can compare your pre-qualified interest rates from multiple personal lenders through Credible.
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Bank personal loans: May require good credit ratings
If you need to get a large loan or want a longer repayment period, a bank can be a great option to get a personal loan for your needs. For example, Wells Fargo offers personal loans with a maximum loan amount of $ 100,000 and repayments of up to 84 months.
However, some large banks no longer offer personal loans. Or they can limit personal loans to small amounts for checking account holders. Others who offer personal loans generally require good, or even excellent, credit ratings in order to qualify for a cheap interest rate and terms.
Funding is usually quick, which means you could get money in as little as a business day.
Advantages of personal loans with a bank
- May offer higher loan amounts than other types of lenders
- Sometimes allow longer repayment periods
- Can provide loyalty or autopay discounts to existing customers
- Can waive the usual fees such as origination or transaction fees
Disadvantages of personal loans from a bank
- You may need good credit to qualify for a personal loan from a bank
- The interest rates can be higher than other types of lenders
- May require collateral to qualify or qualify for preferred rates and terms
- You may need to open an account with the bank or be a current account holder
LEARN MORE ABOUT THE CURRENT PERSONAL LOAN RATES
Credit Union Personal Loans: Flexible loan requirements, but for members only
Because credit unions are not-for-profit organizations, they can often offer their members cheaper products than for-profit financial institutions.
You may find lower interest rates on credit products, including personal loans, at a credit union. And it can be easier for members to qualify for a personal loan with an imperfect credit rating.
Advantages of personal loans from a credit union
- Some credit unions offer loans for small amounts – starting at $ 250.
- You may be able to qualify for a loan with a lower credit score (although you may get a higher interest rate).
- May offer alternative payday loans for as little as $ 100
Disadvantages of personal loans from a credit union
- Must be a member to apply for and qualify for a loan
- You must meet membership qualifications to join
- May charge fees, e.g. B. Creation Fees
Personal Loans From Online Lenders: Quick Decisions And Funding
If your credit score is lower, you have some shortcomings in your credit history, or are in need of quick cash, you can opt for a personal loan from an online lender. Many online lenders are available for personal loans and there are numerous options for people with credit problems.
Approval decisions from an online lender are usually quick, and funding sometimes comes on the same day as they are approved, depending on the lender. However, the compromise for better admission chances and fast financing is often higher interest rates.
Benefits of Personal Loans From Online Lenders
- Many options available for people with lower credit scores
- Application and approval processes are usually fully online
- Financing is often quick – usually less than five working days, but sometimes on the same or the next working day
Disadvantages of personal loans from online lenders
- Maximum rates can be very high
- Finding an online loan when you need a large amount can be difficult
- The lender may charge creation, application or other fees
It can be difficult just looking at the information on a lender’s website to know what interest rate you might qualify for on a personal loan. With Credible, you can compare personal loan rates in just two minutes.
Watch out for personal loan contenders
If you need a small amount of money right away and want a guaranteed approval, you might be tempted to consider a payday loan or a title loan. Payday and title lenders typically don’t require a minimum credit score or even do a credit check.
Generally, when you get your next paycheck in two weeks, you’ll borrow a small amount of money – usually $ 500 or less – and pay back the full amount plus a flat fee.
The Consumer Financial Protection Bureau notes that the APR on a typical payday loan, which charges a flat fee of $ 15 for every $ 100 borrowed, is 400%. And if you cannot fully repay the loan on your next payday, the payday lender may be able to transfer the loan to a new one.
Title loans work similarly to payday loans, but the lender keeps the title of your vehicle as collateral. You typically have 30 days to repay the small loan, but if you can’t repay it on time, the lender can take over your vehicle.
If you’re in a financial bind and need cash right away to cover expenses, try other options, such as:
What you should know about personal loans
When looking for the best places to get a personal loan, keep some important information in mind.
Interest and Fees
Interest rates can vary widely from lender to lender, and even from the same lender, depending on factors such as the loan amount and your creditworthiness. In general, the better your credit rating, the more likely you will be able to qualify for the best personal loan rates.
Also note that personal lenders can also impose a variety of fees, including:
- Origination fees to cover the costs of processing your loan application
- An application fee for accepting your loan application
- Early repayment penalty for early repayment of the loan
- Late payment fees if you are late with a payment or miss a payment once the repayment period starts
Be sure to read the information provided by the lender so that you know what fees, if any, they will charge on your loan.
The length of time it takes to repay the loan can also vary widely depending on the size of the loan, the lender you choose, and other factors. Some lenders offer loan terms as short as 12 months – 36 and 60 months are also common.
When choosing a loan term, keep in mind that a longer term can mean a lower monthly payment, but it also means that you are likely to pay more interest over the term of the loan than if you had chosen a shorter term.
How to qualify for a personal loan
With so many personal loan options available, you might be tempted to apply to multiple lenders, but too many tough inquiries in a short amount of time can affect your credit score.
Pre-qualifying for a personal loan can help you better understand your approval chances before actually applying for a loan. During the application process, the lender will almost certainly be checking your creditworthiness, which can affect your creditworthiness.
However, the prequalification usually has no impact on your creditworthiness, as it is not a hard credit request. You can view your pre-qualified rates from multiple personal lenders through Credible, which you can use for free – all with no impact on your creditworthiness.