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The Best Personal Loans of December 2022

Find the best personal loan for your financial needs.

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Interested in renovating your bathroom? Have some unexpected medical bills or auto repairs? Need to pay for a wedding? A personal loan could help you cover these costs. You can also use a personal loan to consolidate several high-interest debts into one monthly payment, which is helpful if your goal is to organize your finances. 

Many banks, credit unions, and online lenders offer personal loans, and these loans are typically unsecured or not backed by collateral like your home or car. Since they’re unsecured, your creditworthiness will play a major role in whether you’re approved or not and the interest rate you’ll get. 

Depending on the lender, you could get a personal loan as small as $500 or as large as $100,000. Repayment terms also vary but commonly range from 12 to 60 months. It often takes as little as one business day to disburse a personal loan, making it a good option if you need funding fast. 

If you’re considering a personal loan to cover a significant expense, there’s no shortage of lenders. To help you narrow your options, we’ve pulled together a list of our top picks for personal loan lenders.

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Best Personal Loans

Loan results will vary based on creditworthiness, loan purpose, loan amount, and other factors.

Best for Bad Credit

Upgrade

  • Loan Amount: $1,000 – $50,000
  • APR Range: 7.96% – 35.97%
  • Loan Terms: 2 – 7 years
  • Credit Score: 560 or higher

Pros
  • Soft credit check to view your rate
  • Longer-than-average repayment terms
  • No prepayment fees
  • Allows joint applicants
Cons
  • Origination fees of up to 8%
  • Credit score requirements not disclosed 

With a minimum required credit score of 560 and low borrowing amounts that start at $1,000, Upgrade is our top contender for bad credit. Upgrade allows for joint applicants, which boosts your chances of getting qualified. This loan company offers relatively fast funding and is typically four business days after your application gets the green light.

Best for Competitive Rates

LightStream

  • Loan Amount: $5,000 – $100,000
  • APR Range: 5.99% – 21.49%
  • Loan Terms: 2 – 12 years
  • Credit Score: 660 or higher

Pros
  • Low rates compared to competitors
  • Flexible terms and loan amounts
  • No origination, late or prepayment fees
Cons
  • No option to view rates with soft credit pull
  • Rates and terms vary depending on loan purpose

Founded in 2012 and headquartered in San Francisco, California, Lightstream is a financial technology platform that offers personal loans to eligible borrowers. It’s the online lending division of Truist, which resulted from the merger of SunTrust and BB&T Banks. 

Those interested in personal loans with competitive interest rates might find what they’re looking for with LightStream. It offers loan rates from 3.99% to 19.99% (with autopay), which are relatively low compared to competitors. Eligible borrowers can get approved for personal loans from $5,000 to $100,000, and loan terms range from 24-144 months. Both the rate and term you get will depend upon the specific loan purpose. For instance, you might get a better rate or longer term with a home improvement loan than you would with a medical expenses loan.

Still, Lightstream offers low rates overall, as well as a wide range of loan amounts and repayment terms, making it a good option for cost-conscious borrowers seeking flexibility. But you’ll likely need a 660 credit score to get approved for a Lightstream personal loan, and it does not offer the option to view your rate before you formally apply. 

Best for Consolidating Credit Card Debt

Happy Money

  • Loan Amount: $5,000 – $40,000
  • APR Range: 5.99% – 24.99%
  • Loan Terms: 2 – 5 years
  • Credit Score: 640 or higher

Pros
  • Direct payment to creditors
  • No prepayment or late fees
  • Borrower requirements clearly stated online
Cons
  • Origination fee
  • No co-signed or joint loans
  • Can only be used to pay off credit card debt

Formerly known as Payoff, Happy Money offers personal loans that were created to knock off credit card debt. You can borrow up to $40,000, which you can roll your high-interest credit card debt into and make a single payment.

Here’s the kicker: Consolidating your credit card debt with Happy Money can make financial sense if your credit card payments end up being more affordable in the long run, even after doing the math on your new APR and origination fee.

Best for Fast Loan Funding

Prosper

  • Loan Amount: $2,000 – $40,000
  • APR Range: 6.99% – 35.99%
  • Loan Terms: 3 – 5 years
  • Credit Score: 640 or higher

Pros
  • Allows joint applicants
  • Ability to change payment due date
  • Fast next-day funding available
Cons
  • Origination fees and late fees
  • Maximum loan amount lower than other lenders

Prosper is a peer-to-peer lender that prides itself on lighting fast funding times — as quickly as the next business day. So if you need the money in a pinch, then Prosper could be a strong contender. In terms of application speed, getting prequalified can take several minutes if you have the proper information and documentation on hand.

Best for Flexible Payment Terms

Avant

  • Loan Amount: $2,000 – $35,000
  • APR Range: 9.95% – 35.99%
  • Loan Terms: 2 – 5 years
  • Credit Score: 580 or higher

Pros
  • Flexible repayment terms
  • Can choose payment date
  • Accessible for fair credit borrowers
Cons
  • No rate discounts
  • No joint applicant or co-signer
  • High minimum APR

You’ll love Avant’s flexible repayment options if you’re nervous about missing or falling behind your personal loan payments. There’s a 10-day grace period, so you won’t get dinged with a late fee if you’re behind up to 10 days on your payments. Plus, you can give the loan company a ring if you’re struggling and want to explore options to make your loan payments more manageable. 

Best for Large Loans

SoFi

  • Loan Amount: $5,000 – $100,000
  • APR Range: 7.99% – 23.43%
  • Loan Terms: 2 – 7 years
  • Credit Score: 680 or higher

Pros
  • No origination, late or prepayment fees
  • Large loan amounts available
  • Rate discounts
  • Unemployment protection
  • Soft credit check to view your rate
Cons
  • No physical branches available
  • High minimum loan amount  

Do you need a sizable chunk of change to cover a home renovation or pay for medical debt? While most personal loans cap at $50,000 for borrowing amounts, SoFi caps at $100,000. To help you save, SoFi also offers no fee when you close, and an autopay discount of 0.25%. Plus, there’s unemployment protection should you get laid off. Under their unemployment protection, SoFi can temporarily modify your payments and may even offer services to help you land a new job.  

Best for Secured Personal Loans

Best Egg

  • Loan Amount: $2,000 – $50,000
  • APR Range: 7.99% – 35.99%
  • Loan Terms: 3 – 5 years
  • Credit Score: 600 or higher

Pros
  • Fast funding as soon as next business day
  • Simple online application
  • Secured and unsecured options
Cons
  • Origination fee
  • High maximum APR

A secured loan from Best Egg is worth considering if you’re a homeowner. While offering a high-value asset such as your car or home can feel scary, Best Egg’s Homeowners Advantage Loan is a secured loan that lets you offer built-in bookshelves, window shutters, and ceiling fans as well collateral. These items aren’t part of the home’s structure, so it’s less of a risk to you.

Best Egg boasts fast funding for personal loans — we’re talking as quickly as the next business day — and a simple online application. An added perk? Secured loans usually feature lower interest rates and credit score requirements. 

Best for Small Loans

PenFed

  • Loan Amount: $600 – $50,000
  • APR Range: 7.74% – 17.99%
  • Loan Terms: 1 – 5 years
  • Credit Score: 660 or higher

Pros
  • Small loans available
  • Soft credit check to view your rate
Cons
  • No minimum credit score disclosed
  • Membership is required to get a loan

Penfed is an established credit union founded in 1935 and headquartered in McLean, Virginia. While you will need to become a Penfed member if you decide to get a personal loan there, anyone can apply for membership and the process is quick and simple. 

Many lenders have relatively high minimum loan amounts of $1,000 or $2,000, which isn’t ideal if you’d like to borrow a small amount to cover an unexpected cost. Unlike some competitors, Penfed offers loans as small as $600 (or up to $50,000), with no origination fees and APRs ranging from 7.74% to 17.99%. Borrowers can get repayment terms as long as 60 months. 

If you’d like to view personal loan rates with Penfed, you can do so without impacting your credit score. While this lender doesn’t disclose a minimum credit score requirement, you’ll likely need a credit score in the mid-600s to get approved for a personal loan. 

Best for Thin Credit Profiles

Upstart

  • Loan Amount: $1,000 – $50,000
  • APR Range: 6.50% – 35.99%
  • Loan Terms: 3 – 5 years
  • Credit Score: 300 or higher

Pros
  • Low minimum credit score requirement
  • Soft credit check to view your rate
  • Considers factors beyond creditworthiness
Cons
  • High average APR
  • Not a direct lender
  • Origination fees can be high

Are you new to the country or have a thin credit profile for other reasons? Upstart’s got your back. Not only does the lender boast a minimum credit score of only 300, but it might also offer a loan if you don’t have a credit score. The lender is known to consider eligibility factors beyond creditworthiness, such as education, employment history, and bank account transactions. Another way you can qualify for an Upstart loan with a thin credit profile is if you have an existing loan, and make six on-time payments, you may be eligible for a second loan.  

Best for Unique Features

Marcus by Goldman Sachs

  • Loan Amount: $3,500 – $40,000
  • APR Range: 6.99% – 24.99%
  • Loan Terms: 3 – 6 years
  • Credit Score: 660 or higher

Pros
  • No origination, prepayment or late fees
  • Rate discount for autopay
  • Customizable due dates
  • Rewards for on-time payments
Cons
  • No co-signed or joint loans
  • Low loan maximum

While some of the best lenders offer a speedy online application and a fast turnaround on funding, the personal loan from Marcus by Goldman Sachs offers some unique perks and features that make it a standout. For instance, you can customize your due date, and if you make on-time payments for 12 straight months, you can defer one payment without incurring any fees or penalties. 

Average Personal Loan Rates

The current average personal loan rate varies; most can be anywhere from 6% to 36%. 
Here’s the thing: You might not qualify for the lowest rate that’s being advertised.

That’s because the loan amount and rate you get approved for depends on a handful of factors:

  • Credit score
  • Income
  • Payment history 
  • Debt-to-income ratio

Low-interest loans are for those with excellent credit scores. If you have a low credit score, expect to pay more for your personal loan. 

It’s key to prequalify for a personal loan so you can compare quotes from different lenders. That way, you’ll know you’re getting the best loan possible for your needs and situation.

What Can a Personal Loan Be Used for?

Personal loans can be used to cover a variety of large expenses, from home repairs to moving costs. You can also use them for debt consolidation, which can be helpful if you’d like to consolidate multiple high-interest debts into a single monthly payment. Here are some other common uses for personal loans:

While these loans have a variety of uses, there are also some restrictions to be aware of. For example, you generally won’t be able to use a personal loan for college tuition, a home down payment, gambling, or illegal activities. 

Pros and Cons of Personal Loans 

Pros

  • Large loan amounts available
  • Versatility (can be used for many purposes) 
  • Affordable monthly payments 
  • Speedy access to cash 
  • Can purchase big-ticket items 
  • Helps build credit 
  • Competitive rates 
  • Flexible terms and borrowing amounts

Cons 

  • Interest rates can be high
  • Fees and penalties 
  • Adds to debt burden for the long term 
  • More strict lending requirements
  • Might take on more debt than necessary  

How to Choose a Personal Loan

If a personal loan sounds like a decent option for your financial situation, it’s important to compare a few different factors as you shop around with lenders. Doing so will help you get the best possible loan for your needs at an affordable cost. Here’s what to consider as you research different loans.

Accessibility 

As you compare lenders, research if they offer loans in your state. Some lenders only issue loans in certain states, while others offer loans that are available nationwide. 

Minimum Credit Score Requirement

Lenders generally require that borrowers have at least a 620 credit score to get approved for a loan, but some have lower credit score requirements. Research these requirements as you compare lenders, especially if you’ve previously struggled with your credit. And be aware that lenders typically reserve the lowest interest rates for borrowers with the highest credit scores.

Income Requirements

Some lenders also have annual income requirements for borrowers. For example, you might need an annual income of $30,000 to get approved for a personal loan. Look into income requirements for lenders you’re considering.

Interest Rates

The interest rates will help you determine how much the loan will cost you. The lowest rates aren’t necessarily what you’re eligible for. If you have strong credit, you typically are eligible for a low interest rate. Getting prequalified will help you see the true cost of the loan.

Loan Amounts

Looking to borrow $500? How about $50,000? Not all lenders offer personal loans in these amounts. Taking the time to compare loan amounts offered by different financial institutions can help you find the best option for you.

Fees

Origination fees, or the cost to process your loan, are common with personal loans. As you shop around, consider if each lender you’re considering charges an origination fee. These fees can range from 1% to 8% of the total loan amount, and they’re often deducted from your loan proceeds. So the loan amount you get might be slightly different than the amount you applied for. 

Repayment Terms

The amount of time you’ll get to pay off your personal loan can vary based on several factors, including the lender, the amount you borrow, and more. While repayment terms of 12 to 60 months are common, you may also be able to get a shorter or longer term. Keep this in mind as you’re narrowing your options.

Special Features

Some lenders might offer unique perks, such as free financial counseling and a temporary pause on your loan payments should you lose your job. On the flip side, some might offer restrictions such as limitations on what you can spend your loan on. Be sure to check if there are any restrictions on a loan. 

Discounts

Some lenders offer a discount if you set up auto payments or become a credit union or organization member. You could possibly swoop in on a relationship discount if you’re an existing customer.

Customer Service

Should you have a question, need some guidance, or run into a snag or quandary, working with a lender with a responsive customer service team can make a huge difference. Check to see what hours the customer service crew is available and if they’re available via chat, mobile app, and can be reached via phone and email.

Ease of Use

Some lenders allow you to do everything entirely online, from applying for a loan to signing off on the loan documents to making payments. Is there a mobile app available to get your questions answered, upload documents, check the status of your loan, and make payments?

If you prefer to speak to a human in person, does the lender have brick-and-mortar locations? That can help you stay on top of your loan and make for a smoother experience.



How to Apply for a Personal Loan 

1. Figure out how much you need.

First, determine how much money you need and what you’ll use the funds from the personal loan for. This will help you gauge which lender and type of loan is best for you. If you borrow too little, you’ll fall short. But borrow too much, and you’ll be stuck with larger monthly payments and interest fees. 

2. Check your credit.

Next, do a credit check. You can get a free credit report from each of the three credit bureaus — Equifax, Experian, and TransUnion — at www.AnnualCreditReport.com. See if you can spot any inaccuracies, errors, or incomplete info on your reports. Be on the lookout for anything that could affect your credit score, such as mistakenly reported late or missed payments. 

If you spot anything wrong on your reports, file a dispute with the credit bureaus. Getting it straightened out and ensuring your credit reports are accurate can help boost your odds of getting approved for a personal loan.

3. Get pre-qualified.

When you apply to pre-qualify for a loan, the lender will analyze your financial information to figure out what loan amounts, interest rates, and repayment schedule you’re eligible for.

The beauty of pre-qualification is that you’ll get an idea of what kind of loan you can get without actually applying. Plus, the lender does a soft pull of your credit versus a hard pull. This means that your credit won’t get dinged.

4. Compare loan offers.

Once you’ve applied for prequalification and have gathered a few loan offers, do a side-by-side comparison. Look at the loan amounts, interest rate, fees, term lengths and monthly payments. Also, note how long it generally takes for your loan to get approved, and the time frame for the loan proceeds to drop into your account.

5. Choose your lender.

Now, for the fun part: Once you’ve decided on the lender and loan you want, submit an application. This includes providing basic personal information and answering questions about your financial situation.

You’ll also need to provide documentation. This documentation might include a copy of a recent pay stub, tax documents, proof of residence, or a copy of your driver’s license or government-issued ID. Gathering these documents ahead of time will help speed up the process. 

6. Close on the loan.

Once the loan company lets you know you’ve been approved for the loan, you’ll need to finalize the loan documents, accept the terms, and sign off on it. Once the loan documents are signed off, you’ll receive the loan proceeds. Getting disbursement usually takes five business days, but some lenders can deposit funds within several days.

The Bottom Line

If you need fast cash, personal loans are a flexible funding option. These loans typically have a relatively low interest rate compared to credit cards or payday loans, making them a good choice if you’re concerned about borrowing costs. While the lenders we’ve listed above offer solid options for personal loans, it’s always a good idea to compare with your specific financial situation in mind. Consider your needs and shop around to find the best option for you.


FAQs

Can I still get a personal loan if I have bad credit?

Yes, getting a personal loan is still an option if you have bad credit, as there are loans accessible to bad credit borrowers. You’ll most likely have stronger odds of getting a secured personal loan, which means offering collateral to back up the loan. Expect to probably pay a higher rate than a borrower with good credit. The lender might also require that you apply with co-signers.

How much does a personal loan cost?

The interest rates can be anywhere from 3 to 36 percent. Other fees typically tacked onto a personal loan include origination, application, and annual fees. You might also get pegged with late payment fees, and prepayment penalties. Be sure to read the fine print and understand the terms.

What’s the maximum amount I can borrow with a personal loan?

Lenders offer different amounts, and it can be anywhere from $100 to $100,000. However, you’ll usually see personal loan amounts capped at $50,000. How much you’ll be approved for depends on financial factors such as your credit score, credit history, debt-to-income, and the lender.

How is my personal loan rate determined?

The cost of a personal loan depends on your credit score and history, debt-to-income ratio, and how much you make each year. The rate might also vary depending on whether you got the loan through a bank, credit union, or online lender, which might have varying rates and slightly different lending criteria for the same amounts.

While we work hard on our research, we do not always provide a complete listing of all available offers from credit-card companies and banks. And because offers can change, we cannot guarantee that our information will always be up to date, so we encourage you to verify all the terms and conditions of any financial product before you apply.

Jess Ullrich
Jess Ullrichhttps://www.linkedin.com/in/jessicaullrich/
Jess is a freelance personal finance writer. She's been creating financial and business content for over a decade. Before venturing into freelance writing, Jess was on the editorial teams at Investopedia, The Balance, and FinanceBuzz. She's created content across several verticals, including budgeting, credit, debt, insurance, investing, loans, and side hustles. In her spare time, you can find Jess reading about money, working in her garden, or spending time with family.

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