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Contents

Best personal loans online 2020: Find the perfect loan for your credit

By Luke Edwards 05 March 2020

Compare the best personal loans online for good and bad credit, debt consolidation and home improvement.

The best personal loans online are a great way to get the funds you need. You might be looking to get a personal loan to pay off debt or major expense such as some home improvement or a wedding. It could be you simply want the extra cash to help fund something you’ve always dreamed about buying.

What ever you need the cash for, we’re here to help you find the best personal loan for your needs and circumstances. Pay your debt down on time and you could also earn a better credit score as you pay it off.

The good news is that there’s a personal loan for everyone, regardless if you have good or bad credit. While rates and charges will vary depending on many factors, the right loan could be the best way to finance your needs securely.

Despite their reputation, some loans are worth exploring if you’re planning to consolidate all your credit card debts into one loan payment at a lower rate. Others will offer a really low starting rate, if you have a great credit score.

There are lots of factors to take into account. Are you looking for the best APR, or do you need a longer-term loan? Perhaps it’s flexible repayments or payment security that you prioritize. Whatever your needs or financial situation, we’ve reviewed the best personal loan companies and summarized then for you so you can quickly and easily find the perfect online personal loan for you.

Compare personal loan rates at Credible
Credible is the perfect place to start your search for the best personal online loan rates. It gets rates from hundreds of banks and lenders for you, so you don’t have to fill out the same details again and again.

1. Marcus by Goldman Sachs: Best personal loan overall

Marcus by Goldman Sachs

Best for service

APR variable: 5.99 – 28.99% | Loan range: $3,500 – $40,000 | Min credit score: 660 | Term: 3 – 6 years

Marcus by Goldman Sachs has one of the best customer service ratings of all the personal loan companies out there, which is one of the reasons it ranks top of our list of the best online personal loan providers.

Loans come with a range of benefits like low starting rates, a lack of fees and flexible payment options. The ability to change the due date up to three times during the life of the loan is a nice feature as is the relatively low credit score required for such a low starting rate.

You can skip one payment per year and it will simply be added to the end of your loan term. The lack of hard credit pull is appealing but that’s not to say this is ideal for lower credit rating borrowers as it won’t allow co-signing and does require a minimum 660 credit score.

2. Lightstream: Best personal loan for strong credit

Lightstream

Best overall personal loan for strong credit

APR variable: 4.49 – 17.49% | Loan range: $5,000 – $100,000 | Min credit score: 660 | Term: 2 – 12 years

Lightstream personal online loans are some of the best available right now with excellent rates, a high top-end loan amount, long term options and no fees. While the application process does require a hard credit pull, this loan is only for those with a good credit score of 660 and above. If you’re worried about a rejection then you should avoid this loan company.

Rate undercutting means Lightstream will offer you 0.10% less than any other offer you get from a competitor. With up to a 12-year loan period this is ideal for anyone looking to carry out a big project that costs a lot and needs repayment spread. All that and if you’re unhappy you’ll get $100 back for your troubles if you complain within 30 days.

3. Upstart: Best personal loan for new borrowers

Upstart

Best for new borrowers and graduates

APR variable: 7.69 – 35.99% | Loan range: $1,000 – $50,000 | Min credit score: 620 | Term: 12 – 60 months

Upstart, as the name suggests, is a personal loan for those just starting out in the world of borrowing. That means both those with little or no credit history and those with poor credit ratings could find they are approved by Upstart where others have said no. This applies particularly to graduates with a coding background since this company was started by ex-Google employees. Upstart looks at more than just credit scores with a high value put on potential future income, so graduates with a good degree could do well.

The catch is that rates start a little higher than the competition and there are fees, including origination and late fees. But with super-fast funding, this is one of the best personal loan options out there, especially for graduates.

4. SoFi: Best personal loan for security

Best for security

APR variable: 5.99 – 17.67% | Loan range: $5,000 – $100,000 | Min credit score: 680 | Term: 2 – 7 years

SoFi requires a good credit score to get one of its loans but should you qualify then you can enjoy lots of benefits. The starting rate of 5.99% is decent and the top end amount of $100,000 is generous. But it’s the membership perks and security we like. That security comes in the form of a forbearance feature that will protect you should you become unemployed. This lets you pay interest-only for up to a year while you find a new job.

Membership benefits include lower rate second loans and invites to private events with business owners, career counsellors and mentors. There are no fees and total transparency on these loans but you may have to wait up to seven days for funding to come in.

5. Prosper: Best personal loan for medical fees

Prosper

Best for medical bills

APR variable: 5.99 – 36% | Loan range: $2,000 – $40,000 | Min credit score: 640 | Term: 36 – 60 months

Prosper personal online loans offer a way for those with lower credit scores of 640 to get a loan at a decent starting rate of 5.99%, but the company also specializes in medical bill payments.

This is a peer-to-peer loan meaning it comes from multiple investors. As such the top-end rates are very high at 36% and late fees and origination charges do apply. Soft credit checks won’t affect your credit rating and if you are in no rush you can get a lower APR on your loan. The specialist healthcare loans go up to a higher amount and have lower top-end rates, but require a higher credit score.

6. Lending Club: Best peer-to-peer personal loan

Lending Club

Best peer-to-peer loan for debt consolidation

APR variable: 5.99 – 34.99% | Loan range: $500 – $40,000 | Min credit score: 660 | Term: 36 – 60 months

Lending Club is the original peer-to-peer loan company that allows investors to spread money across loans meaning borrowers can get credit without going to a bank.

You’re still required to have a credit history and decent score but it is aimed at paying off debt and will even consolidate multiple credit cards for you by paying them, so you’re left with one fixed-rate loan. This starts low at 5.99% but shoots up to 34.99% at the high end. This is great for improving credit rating while clearing debt and even allows co-signing, so those with a credit score as low as 540 can be eligible for a loan. An interest-only hardship payment plan is a nice security net for those struggling to repay. But with a 1 – 6% origination fee and 5% late fee it’s not perfect.

7. Avant: Best personal loan for low credit scores

Avant

Best for low credit scores

APR variable: 9.95 – 35.99% | Loan range: $2,000 – $35,000 | Min credit score: 580 | Term: 2 – 5 years

Avant is one of the best personal loans for those with a low credit score. Not only does this only require a score of 580 but it also carries out a soft credit check first so you don’t need to risk lowering it further.

This will cost you though as even the low-end rate is 9.95% APR which climbs to a heady 35.99%. Charges are clear with both origination and late fees made obvious from the start. There are flexible payment options to help if you get into any trouble repaying this loan.

8. Regions: Best personal loan for non-US citizens

Regions

Best for non-US citizens

APR variable: 7.99 – 17.99% | Loan range: $2,000 – $35,000 | Min credit score: Undisclosed | Term: 24 – 60 months

Regions is a very rare personal loan company as the Regions Bank is willing to take applications from, and will actually fund, non-US citizens. This is also a great loan for those seeking smaller dollar amounts from their loan with flexible lines of credit.

While this onnline loan company does cater for those with less impressive credit scores, the rates can be higher in those instances, topping out at 17.99% APR. You can make some savings with deposit secured loans and by using autopay. The downsides are that you must have a Regions checking account and there are both origination and lates fees.

9. Payoff: Best personal loan for debt consolidation

Payoff

The best debt consolidation specialist

APR variable: 5.99 – 24.99% | Loan range: $5,000 – $35,000 | Min credit score: 640 | Term: 2 – 5 years

While this is a personal loan specifically for debt consolidation, it won’t pay off who you owe directly – like some competitors will. That is kind of a positive though as it fits with the company’s ethos of empowering and educating the borrower to clear their own debts and become better at handling money themselves.

This is done through a host of supportive tools including learning resources, online chat assistance and a member advocate for personal guidance. The end result should be regular, on-time payments, which help improve credit score as the loan is paid back.

Compare personal loan rates at Credible
Credible is the perfect place to start your search for the best personal online loan rates. It gets rates from hundreds of banks and lenders for you, so you don’t have to fill out the same details again and again.
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How to apply for a personal loan

Applying for a personal loan online in many cases is simple. The initial application process may only take a few minutes. Information varies from lender to lender, but you’ll most likely be asked to provide your address, employment status, estimated credit rating, Social Security number and income information.

You may also be asked to provide further supporting documentation such as proof of income and your address. This basic information helps the lender or broker determine whether you are a good candidate for a loan. Your credit will also be verified using the three major credit-reporting agencies. Many lenders run what is called a “soft credit check” that will not negatively affect your credit score.

What can you use a personal loan for?

A personal loan is one of the few types of loan with few to no restrictions on what you can use the funds for. Where mortgages must go toward a house, student loans must cover college expenses, and auto loans go toward a car, personal loans – in most cases – can be used for nearly anything you can think of, be it a personal or a household need. Typically, people use personal loans for things like moving expenses, vacations, medical emergencies, large purchases and to consolidate debt, among other things.

Still, it isn’t unheard of for lenders to set limits on what you can use the money for, even though it isn’t standard practice. A lender may specify that you cannot use your personal loan to pay for a car or to cover business or college expenses. The lesson here is to read all the fine print attached to any personal loan you are considering. That way, you won’t be blindsided by strict requirements that limit how you can spend the money you borrow.

Factors that influence your loan rate

As with most loans, your credit rating is scrutinized. Each lender has its own requirements, but you’re more likely to obtain a personal loan if you have good credit and a dependable, steady income. If you have not established credit through traditional lines, such as credit cards, a mortgage or auto loans, the lender may consider your payment history with other bills such as utilities or rent.

Interest rates can vary greatly. If you have good credit, you can likely obtain a competitive rate. If your credit is bad or marginal, you can expect to pay a much higher rate, or you may not receive an offer at all.

Lenders may also evaluate your income. Many have minimum income requirements, and these vary from lender to lender, but usually the requirement is a few thousand dollars per month, depending on the loan size and your debt-to-income ratio.

Personal loan fees to consider

The first fee to consider is the actual interest rate. Rates vary greatly. Just a few percentage points in the long run can make a huge difference, so you’ll want to shop for the best rate possible.

A second loan expense to consider is origination fees. Not all loan companies charge this fee. The origination fee is taken from the loan balance. For example, if you get a $10,000 loan but the lender charges an origination fee, your initial deposit won’t be the full $10,000 because the origination fee has been taken out.

The last fee is a check-processing fee. Most companies nowadays add an extra charge to process check payments.

Personal loan rates for good credit

Loan offers, as well as their terms and rates, vary wildly depending on your credit score. If you have a good credit score, which is considered to be any score at or above about 690, you’ll have better loan opportunities available. Additionally, if you have good credit, it’s more likely that your loan will have lower rates, more flexible terms and fewer fees, if any. This is especially true for people whose credit scores are considered to be excellent, which is above 720.

Individuals with a good credit score will also have a wider variety of lenders to choose from, be it from one of myriad online sources or from your personal bank or local credit union. If your credit score is good, we recommend taking the time to shop around for the best loan, so that you end up with one that has the best terms and conditions, fewest fees, lowest rates and, ideally, payment flexibility.

Best personal loans for bad credit

If your credit is far from excellent, don’t fret: There are likely plenty of loan options available to you. The caveat, however, is that with a bad credit score – that is, any score below about 630 – your loan’s rates are likely to be higher. You’ll find that your options are more limited and that you may also have to deal with higher monthly payments or inflexible terms.

The lenders that offer loans to people with low credit scores typically scrutinize your credit history more intensely than they would for applicants with higher scores. Before signing on to any old loan, we recommend checking out the personal loan options at your local credit union first as they have your best interest at heart and usually have a cap on the interest rate they can charge you.

If you have a really low credit score and think you might not pre-qualify for a loan, your other options are to get a co-signer for your loan, borrow against your home’s equity or ask a relative or friend to take a loan out for you in their name. Payroll advances and borrowing against your 401K or life insurance are also options, but they aren’t something we recommend, as they have steep interest rates and can end up hurting your credit in the long run.

How to get the best personal loan for you

Do your research: Though it’s tempting to grab the first loan you see, taking the time to research your options can pay off – quite literally – in the long run. Before applying for a loan, look at any requirements it may have. Does it require a co-signer or collateral? Does the lender run a soft or hard credit check? Are there better options through your bank or local credit union? Knowing the answers to these questions can help point you in the right direction.

See if you pre-qualify: Many loans give you the ability to see if you are eligible for them before formally applying. The pre-qualification process typically requires you to verify your employment, age, residency and income, and it may involve a credit check. Be sure to check whether the lender will do a soft or hard credit check, so your credit score isn’t unnecessarily impacted.

Shop around: There are thousands of loan options out there from a variety of lenders. Once you get pre-approved, taking the time to shop around gives you a better chance to find the best deal for your needs. While looking around, it’s important to keep in mind what a lender will get out of you taking out a loan through them. Many lenders are predatory, advertising a great deal while disguising sky-high interest rates and fees or ridiculous terms. Try to avoid loans with variable interest rates that flux over the life of the loan, in favor of fixed rates instead. Your best bet is a loan through your local credit union.

Apply: Before formally applying for a loan, be sure to read any fine print. Here you should be able to see all the fees, rates, terms and conditions attached to the loan. You should also be able to see any hidden fees here, including application fees, establishment fees, origination fees or early repayment fees. If you’re unsure about anything in the fine print, we recommend contacting the lender directly and asking for clarification.

Get approved: This is the easiest step! The lender will inform you that you have been approved and for how much. Note that some lenders may approve you for an amount exceeding what you needed; and though it’s tempting to accept the full amount, doing so can cost you more in the long run with fees and interest.

Receive your funds: Once you’re approved, you’ll receive your money either by direct deposit or physical check. How long it takes to get your money varies by lender. With some lenders, it may take a couple of weeks; with others, you’ll receive the money the same day that you’re approved.

Repayment: You’ll start paying back the loan according to the terms set forth by your lender. In most cases, you’ll have a set monthly payment. If you want to pay off the loan all at once, check beforehand to see if the lender allows you to do so without penalty.

Managing your loan

One of the benefits of getting an online personal loan is that it’s easier to manage than one you’d take out in person at a bank or credit union. Once you log on to your lender’s website, you should be able to view all pertinent details for your loan. In most cases, you should be able to view related documents, along with your current balance, next payment amount and due date, payment instructions, a single payment portal and lender contact information.

Good lenders will also provide you with your payment history, automatic payment setup, the ability to view and edit your account information as well as a way to review your loan’s rates, fees, terms and conditions. They’ll also have an intuitive and clearly labeled interface that makes it easy for you to view all of your pertinent information, and they won’t try to hide anything from you in confusing menus or fine print. We also like lenders that provide a mobile app so you can view your loan, its related information and even make a payment, no matter where you are. Good lenders may also include a link where you can view your FICO credit score, allowing you to manage both the loan and your credit while repaying the loan.

Your payment options? Your lender should provide you with at least two ways to make a payment on your loan. The easiest way to make a payment is to set up autopay – the amount due will be deducted from your account automatically each month. This is also the easiest way to ensure you don’t miss a payment, which can negatively impact your credit score and possibly even affect your interest rates or other loan terms. You should also be able to make a manual online payment or call the lender’s customer service number to make a payment over the phone. Depending on the lender, other repayment methods may be available as well, including mailing in a check or cash, or making a payment in-person at a brick-and-mortar branch.

We found that, in addition to offering multiple convenient payment methods, the best lenders also make it easy for you to make a payment. Whether you’re making a payment over the phone or online, they should provide step-by-step instructions for paying your bill every time. This feature is especially handy for those who haven’t made a payment through the lender before. Typically, your physical or online bill will give you instructions and provide a way for you to review extra information online.

Contact information for the lender should also be readily available and clearly listed on the bill or website portal so you can quickly get ahold of them should you have any questions about making a payment or you encounter a problem when trying to make a payment. If you call in, some lenders have an automated interactive voice response system that can help you make your payment without ever having to talk with a representative.

What happens if you default on your loan? It is fairly easy to get a personal loan – the tricky part is making payments regularly and repaying it in full. With a bank account and a decent internet connection, you can easily set up auto payments and not spend another minute worrying about the loan. But what happens if you miss a payment or end up defaulting on the loan?

Depending on factors like your loan terms, your location and the lender, you could be considered in default after missing just one payment, or it could take months of missed payments. Typically, when you default on a loan, you can expect your credit score to take a hit, and the blemish on your credit report could remain there anywhere from three to 10 years. This bad mark could even affect your chances of getting a job or buying a house down the line.

Beyond that, the lender could potentially sue you or place a lien on your assets. If that happens, you can end up on the hook for paying court or attorney fees. In court, the contract you signed with the lender saying you agreed to repay your loan will most likely be held against you. The lender could also send your debt to a collections agency, and you could have your tax refund or wages garnished or even be required to repay your overdue balance in a single, immediate lump sum.

Keep in mind, you still owe a payment even if you don’t receive a bill – mail can get stolen or lost, you may forget to change your address after you move, or the lender may put in fine print that it is a paperless company and will never send you a physical bill. Either way, it is your responsibility to contact the lender over the phone or online if you don’t know when your bill is due. Depending on the lender, you may also be able to change your payment due date.

Differences between online lenders and banks

When thinking about getting a loan, it’s worth knowing the difference between types of lenders. Though online lenders and banks both offer a similar product, that’s where the similarities end. From paperwork to loan rates, we recommend reading up on how these two lender types vary so that you can make the smartest decision for your financial needs.

Online lenders: One of the biggest benefits of shopping for a personal loan online is you can easily compare multiple loan options from several lenders at the same time. Additionally, online lenders have less stringent application processes that don’t require as many qualifications. Many don’t even require a hard check on your credit. Online lenders also boast more unsecured options, less paperwork, and quicker approval and funding times, so you can get the money you need fast.

On the other hand, it is easy to get scammed online. With so many loan options at your fingertips, it can quickly become difficult to tell which lenders are trustworthy and which only have their best interests at heart. Once you choose an online lender, you’ll also find that you have limited support options. Whether you have questions about filling out the application or about the loan itself, you’ll only have the communication tools they provide to you. This could be troubling if you don’t understand some of the terminology or their website goes down. Online loans typically also have higher APRs and more fees.

Banks: Getting a loan from a brick-and-mortar bank brings peace of mind. Banks usually offer bigger loans for cheaper, meaning lower APRs and fewer fees. And while online lenders typically only offer unsecured loans, banks usually have secured options as well. Going into a bank to get a loan also means you can get help filling out your application from someone in person. They will also be able to answer more questions and provide helpful support throughout your entire loan process.

The downsides to getting a loan from a bank aren’t many – at least not compared to online lenders. A bank may require more paperwork and have a more rigorous application process. They may pull a hard credit check and ask you to provide more extensive documentation. It usually also takes longer for your loan to get approved and funded through a bank. And you’ll have access to fewer loan options.

Differences aside, what matters most is what you bring to the table. Your qualifications, credit score and history, and total needed loan amount, are all individual factors that help shape the loan offers you quality for. It’s no secret that people with excellent credit scores and a healthy credit history have access to both more loan options and better loan options than those with a poor credit score.

Getting a personal loan through your Credit Union

If a traditional loan doesn’t seem like the perfect fit, check out the personal loan options available to you through a credit union. You can use these loans for pretty much anything, just as you would with a traditional personal loan. Since credit unions are not-for-profit organizations, you can expect to receive a lower interest rate on your loan than you would elsewhere, even if you have an average or poor credit score. Credit unions are member-owned and designed to focus on the needs of their members rather than profits, which is why they can offer lower rates and fees.

Typically, credit unions can offer you secured and unsecured personal loan options. A secured loan requires you to make a deposit as collateral, which the credit union will use to cover its losses should you default on the loan. This type of loan has lower rates than the secured option and may allow you to earn interest on your deposit. An unsecured loan doesn’t require this and is the more common option. No matter which option you choose, however, credit union loan rates are much more affordable than nearly any other option out there.

Your Rights as a consumer

Lenders are legally obligated to provide consumers certain protections. Legal documents are often confusing, and the loan process can be overwhelming. Perhaps you are unsure what questions to ask. Below is a list of your consumer rights and the questions you are entitled to ask. This isn’t a complete list. The Federal Trade Commission (FTC) website offers some helpful resources in the consumer information section of its website.

Some of your rights include the following:

  • Credit decisions cannot be based on your race, color, gender, national origin or other such identifiers. Credit decisions can, however, be based on your financial status. If you feel you have been unlawfully discriminated against, contact your state attorney general’s office.
  • You do not have to reveal your marital status if you are applying for a loan in a non-community property state.
  • Creditors are not allowed to discriminate if you receive public assistance.
  • Within 30 days of applying for a loan, you should receive notification whether you’ve been accepted or rejected.

You have the right to ask for the following:

  • If you are denied your loan request, ask why. There may be information on your credit report you may not be aware of, or there may be incorrect information. You also have the right to obtain a free copy of your credit report.
  • Inquire about the total cost of the loan, including interest, fees and other charges. While a low monthly payment may seem attractive, you may discover, on closer analysis, that it is not in your best interests. For example, some lenders charge fees for processing check payments.
  • Request clarification on any terms or legal language you do not understand. Do not sign any type of legal agreement if you do not fully understand the terms.

Avoiding personal loan scams

Loan scams are real, and you should be wary of offers that seem too good to be true. The FTC and other consumer-rights groups regularly warn consumers about loan scams. Here’s how you can protect yourself:

  • Always be suspicious of unsolicited loan offers. If you receive a phone call or mail you didn’t request, you should be careful.
  • Be wary of lenders that are not interested in your credit history. All legitimate lenders and banks will evaluate your credit history.
  • Verify that the lender you are considering is registered in your state.
  • Do not send any money to a lender that asks you to make a payment upfront before you’ve received your loan funds. Legitimate lenders will not ask you to do that.
  • If you’re using a loan broker, always verify the bank or institution. Do your research. Physical locations, P.O. boxes, etc., should be thoroughly investigated.
  • If you have bad credit and are seeking a personal loan, you’ll need to be extra cautious. That said, there are numerous legitimate lending agencies available to help those with marginal credit. In addition, each state provides free resources to those desiring to improve their credit. In many states, it is the Consumer Credit Counseling Service that can assist you.

How to monitor your credit

Keeping an eye on your credit is important even when you aren’t actively seeking out a personal loan. Monitoring your credit can help you make smarter financial decisions and potentially even help you get qualified for better loans with better rates and terms.

The better your credit is, the more likely you are to be approved for a personal loan, especially one with good rates and terms. Learning about your credit’s health and history can give you an idea of how likely you are to be approved for a loan, or if it’s even a good time for you to be applying for a loan.

There are many ways to monitor your credit, all of which are easy and cost little to nothing. The Federal Trade Commission states that you are entitled to “one free copy of your credit report every 12 months from each of the three nationwide credit reporting companies.” Additionally, most banks and credit cards provide similar services, or you can use a third-party app like Mint, Credit Karma or Wallethub.

Mint helps you track your spending and provides a credit report and education about credit scores. Apps like Credit Karma can provide you with your credit scores from TransUnion and Equifax, with regular updates. They let you view the factors that affect your credit, such as credit card utilization, open accounts, hard inquiries and payment history. These apps can even recommend credit cards and loans tailored to your credit history and help determine if you pre-qualify for them.

Should I get a co-signer for a personal loan?

If you’re applying for a personal loan and aren’t confident you’ll be approved or worry that a low credit score might leave you with a high rate, getting a co-signer can help. Having a co-signer with a higher income or better credit history improves your likelihood of being approved and can get you a better rate and terms.

When looking for a co-signer for a personal loan, you need to keep a few things in mind. First and foremost, your co-signer is a loan guarantor – they appear on all paperwork, and if you fail to make timely payments, they become liable. This means late payments don’t just affect your credit. They affect your co-signer’s credit too. Failing to make payments on time opens your co-signer to liability and could damage your relationship with that person.

Unlike student loans, most personal loans don’t have a co-signer release period. If you want to relieve your co-signer of their responsibilities later on, you need to refinance the loan to remove them as a co-signer. To do this, you need to improve your personal financial situation to the point where you can get approved solo. This means making on-time payments on all your debts, not just your personal loan. Also, improve your debt-to-income ratio by paying down other debts.

Ultimately, the decision to have a co-signer on your loan depends on their willingness to help you and open themselves to liability. If you have friends or family who are willing to help you out, make sure you stay on top of payments to ensure they aren’t left footing your bills.

A home equity loan or line of credit can be an attractive alternative to a personal loan. If you’ve owned your home for a while and have built up significant equity, you may be able to tap into it and get a better rate than you would on a personal loan. Deciding which type of loan to get depends on several factors, including your equity in your home, how much money you need and your credit score.

Typically, you can take out personal loans in amounts ranging from $10,000 to $100,000. The limit on a home equity loan depends on your home’s value and how much of the existing mortgage you’ve paid off. Most lenders only lend up to 85 percent of your available loan to value, which is the difference between your loan balance and your home’s current value. So the loan amount will be less than your total equity. If you only need a small sum of money, a personal loan may be the better option. However, you could consider a home equity line of credit – it has the flexibility of a credit card and may have better rates than a personal loan.

Another factor that may guide your decision is your credit score. Personal loans tend to have stricter credit requirements than home equity loans – a poor credit score can affect your rate, loan amount or even your approval. Typically, to get the best rate on a personal loan, you need a credit score in the 700s. Home equity lenders’ credit requirements aren’t as strict. Typically, you can get good approved and even secure a good rate if you have a score in the mid-600s.

One drawback of a home equity loan is the application process is longer than that for a personal loan. The process is similar to the one you go through to get a regular mortgage – you need to have your home appraised, and it can take up to a month to get approved.

Can I use a personal loan to pay for school?

The short answer is yes – you can use a personal loan to cover tuition and other costs associated with higher education. However, there are several reasons this may not be a good choice, especially since rates for both types of loans tend to be comparable if you have good credit.

If you need help paying for school, check with the federal government first. Fill out a FAFSA form to see what aid you’re eligible for. Your credit score isn’t used to determine whether you are eligible for a federal loan, so that isn’t an impediment. In addition, there’s no age limit on a FAFSA, so you can apply for federal aid even if you’re older and considering going to school.

Lenders consider your credit score when you apply for private student loans, and they have higher rates than federal loans. However, they’re available in larger amounts, so a private student loan may be an option if you’ve already taken out $57,500, or $31,000 if someone can claim you as a dependant, from the federal government – the max it allows. To get a good rate on a private student loan, you need a score in the 670 range or better.

It may seem like a good idea to get a personal loan in lieu of a private student loan, but student loans generally have features that make them a better choice. The primary reason to get a student loan to pay for school is you don’t have to make payments until you complete your education, and most have a six-month deferment period. With a personal loan, you need to begin making payments immediately, which can be a problem if you want to focus on your studies and not work while you are in school. Student loans also have a variety of forbearance and deferment options that aren’t available with personal loans.

The Best Business Loan and Financing Options of 2020

Update: This page has been updated to include details on a new partnership within the business loan industry.

Part of running a business is seeking funding. If you’re working on a startup, you’ll need financing to get things off the ground. If you run an established small business, you’ll need funding to expand operations at some point. Even enterprise companies sometimes need loans and investments to kick off new projects and expand. Funding can mean growth, and if you get the right loan with the right terms for your business, you can benefit highly from financing.

There are many different types of financing for small businesses. Traditional long-term loans are ideal for real estate, SBA partners offer disaster relief loans, and alternative lenders can provide fast business loans without collateral. As long as your business is stable and healthy, you’ll be able to find some form of funding.

February 2020: New research shows that accessing capital is a priority for many businesses during the first quarter of 2020. The study from Balboa Capital revealed that among small businesses that need growth capital in the first few months of the year, 25% will apply for a small business loan, 19% will apply for a business line of credit, and 13% will apply for equipment financing. Of those, 42% plan to turn to banks for the money, with 29% looking for loans from alternative lenders and 21% expecting to reach out to credit unions for an influx of capital.

Best Picks

Editor’s note: Looking for a small business loan? Fill out the questionnaire below to have our vendor partners contact you about your needs.

Reviews

What to Expect in 2020

In 2020, the number of companies that offer online and mobile lending is expected to grow. Since digital options provide extensive financing opportunities and faster approval, they are expected to be popular choices compared to traditional banks and credit unions.

In recent years, large companies like PayPal and Amazon have joined and made a big impact in the small business lending market. PayPal made $10 billion and Amazon $1 billion in loans to American small business owners over the last five years. Along with Square, they have become top loan options for small businesses.

Digital lenders’ use of personalized offers makes them more attractive to small business owners. Brands have learned to target consumers based on their specific interests, and we expect more lenders to follow suit. To provide entrepreneurs with the specialized funding they need and at the right time, we predict digital lenders, like PayPal and Amazon, will increase their personalized offers to small businesses.

Peer-to-peer lending is also projected to increase among small businesses. With peer-to-peer lending, interest rates and loan offers are based on a business’s earning potential rather than its credit score. As peer-to-peer loans become more common, the camaraderie within small business groups is likely to strengthen and grow. Transparency Market Research predicts the global peer-to-peer lending market will reach $897.85 billion by 2024.

March 2020: Traditional bank loans are difficult to secure for small businesses. However, Fifth Third Bank is hoping to bridge the gap with its new partnership with Fundation, an alternative online lender.

When banks don’t qualify for traditional bank loans, this partnership will steer business owners toward alternative options. As alternative lending becomes increasingly popular, partnerships like this are projected to grow to accommodate the financing struggles of small businesses. For companies that fall short of Fifth Third’s loan requirements, the bank will use Fundation’s tools to help them access loans that reach $10,000 to $100,000. Their partnership makes the loan process easier and gives small business owners better access to financing opportunities. It also speeds up the process by giving small business owners the ability to accept and decline loan offers and sign contracts online.

As we move through 2020, it will be interesting to see if other traditional banks follow suit and form their own partnerships with alternative lenders.

Rates and Terms

Small business loans include some form of interest, which can be either a fixed or fluctuating rate depending on your agreement. Many alternative lenders provide a fixed payback amount at the beginning of the loan. This means you make weekly or monthly fixed payments toward both the interest and the principal.

You can also sign up for loans with interest rates. Sometimes, rates are adjustable, meaning they can fluctuate over the time of the loan. Depending on your agreement, lenders often charge either simple or annual percentage rates. While a simple interest rate would be the percentage of interest paid off on the total loan, an APR is an annualized interest rate that accounts for fees as well. The total cost to you is based on your agreement and the type of interest rate, so it’s important to analyze how much the loan will cost you in total (not just per month) before you sign.

In addition to a few different kinds of interest rates, companies may charge various fees, such as origination or returned-item fees. As with any business agreement, make sure you read the fine print and understand the fees you’re being charged.

Some lenders also require collateral, which can take many forms. Banks and alternative lenders often require business or personal assets to back a loan. These assets can be liquidated in the event of a default. When you provide collateral, you’re entering into a secured loan. Unsecured loans have no collateral, but they sometimes require a personal guarantee. The personal guarantee is a legally binding statement that says you personally will pay back the loan if your business defaults on its payments.

Our Methodology

To find our best picks, we started by analyzing more than 130 lenders. We compiled this initial list by finding industry leaders, considering vendor list requests, researching other review websites and reviewing former best picks. We started by considering each company’s loans, website experience and online reputation. We also looked at whether the lender is geared toward small businesses. From this stage, we narrowed our list down to roughly 30 lenders.

We then took a more in-depth look at each lender, analyzing loan amounts, specific loan options, online transparency and deposit time. This brought our list down to about 18 companies, each of which earned a review on Business.com. We looked at each company’s loan process, requirements, individual rates, term lengths and customer reviews. We called some company’s sales teams to find out more about their loans.

After this stage, we compiled potential best picks – about six companies – and took an even deeper dive into each company’s service. We posed as small business owners and called each company’s sales teams to test its customer service and learn more about its loans. We verified online information and asked for other information that wasn’t available online. We looked at additional fees, repayment structure, other considerations and requirements for a loan, and restricted industries. Our best picks withstood each round of research and held up as the best lenders in the industry.

How to Qualify for the Right Loan for Your Business

Qualifying for a loan basically means proving to the lender that, based on your revenue and credit, your business is healthy enough to pay back the money you’re asking for with interest. Individual requirements and qualifications depend largely on what type of lender you work with. Traditional banks, for example, have higher requirements and standards than alternative lenders. However, there are a few basic principles to keep in mind when looking for a loan from any source. Lenders generally have benchmarks for credit scores and revenue. This verifies that you have a history of paying back loans and currently have a business that can support monthly payments. In general, the less stable your business, the higher the interest rate.

Some alternative lenders will give you a loan without checking your credit score. Instead, they want to get a detailed idea of your business’s cash flow so they know you can pay your loan back based on how much money you take in each month. Others give credit scores much more weight. While revenue benchmarks vary widely among lenders, credit scores are easier to quantify. You need a credit score of at least 500 to secure a loan from some companies. In general, the higher the credit score and the better the revenue, the lower the interest rates.

Documentation and Financial Statement Preparation

The required financial documentation also depends on what type of lender you’re dealing with. Almost all lenders want to at least look at your recent bank statements, so make sure you have the last six months of statements at the ready. Some lenders require tax returns or business plans. Financial documentation required for a loan varies so widely that it’s a good idea to ask your loan specialist upfront – especially if you’re looking for quick funding. They’ll be able to tell you exactly what the lender requires in your situation.

State of the Industry

There are a few different kinds of alternative lenders that provide small businesses with the funding for growth. Each has varying requirements and qualifications to get a loan. While traditional banks can be great funding resources, they will likely be the hardest to get financing from. They have strict underwriting processes and require a lot of financial documentation for a loan. You’ll also have to put up collateral with loans from traditional banks. Wells Fargo is the only traditional lender we looked at with unsecured loans. In May 2020, big banks only approved roughly 25% of the small business loan applications they received, according to Biz2Credit.

In the same month, Biz2Credit found that alternative lenders approved around 56% of their applicants. Alternative lenders provide a wider range of loans and qualifications, like unsecured loans and short-term funding. Interest rates with these lenders will likely be higher than with traditional banks, but if your business can’t meet the standards of a traditional lender, alternative lenders can be a great option. They often provide instant quotes and prequalified information online without a hard credit inquiry. This is a good way to see what kind of loan you would qualify for without committing to a loan.

In addition to traditional banks and alternative lenders, small businesses can get funding through the Small Business Administration. The SBA has a lending program that provides various types of loans for small businesses. These loans are financed by banks, like Chase or TD Bank, and the SBA incentivizes these institutions to lend to you by guaranteeing a certain percentage of the loan. As with traditional banks, getting an SBA loan may be a longer, more difficult process than going with an alternative lender, but it’s a great way to get funding from a reliable source.

Regardless of the lender, there are a few types of small business loans to know about:

  • Term loans are more traditional loans for small businesses.
  • Revolving lines of credit generally have no defined terms and can be drawn on, paid off and drawn on again.
  • Working capital loans are generally short-term loans to help manage cash flow.
  • Invoice financing is a way to get an advance on outstanding invoices. Lenders will generally provide factoring services or provide a line of credit backed by your accounts receivable for a loan.
  • Merchant cash advances are cash advances that are paid back with daily credit card sales; these loans are also ideal for quick funding needs.
  • Equipment financing loans are tied specifically to vehicle, equipment and software purchases.

Knowing about these types of loans and what your business needs can help you make the right decision when it comes time to partner with a company.

Regional Finance Personal Loans

in Personal Loans from Regional Management Corp.

Regional Finance Personal Loans

in Personal Loans from Regional Management Corp.

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Highlights

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Community Rating
Loan Amount $600 – $10,000
APR (Fixed APR) 21.99% – 99.9%
Loan Term 6 – 60 months

Regional Finance Personal Loans Review

Regional Finance Personal Loans is offered by Regional Management Corp., a direct lender founded in 1987 and based in Greer, SC. Regional Finance Personal Loans is available in 10 states across the USA.

Key takeaways

  • Fast access to cash. In some cases you can get your money within 1 business day.
  • Fair credit accepted. The credit score needed for Regional Finance Personal Loans is relatively low. Borrowers with a credit score as low as 590 may qualify for Regional Finance Personal Loans.
  • Hard credit pull required. You can’t check your rates or see if you prequalify for Regional Finance Personal Loans without a hard pull on your credit report. Most lenders give you the option of a soft pull on you credit report.
  • Short loan terms. Regional Finance Personal Loans offers loan terms as short as 6 months. Most personal loans have a minimum term of 12 to 36 months.
  • Minimum income of $25,000. You will need an annual income of at least $25,000 to apply for Regional Finance Personal Loans, which is above average for the lenders in our database.

Regional Finance Personal Loans Pros and Cons:

Pros Cons
  • $0 prepayment fee.
  • Considers applicants with poor credit.
  • Fast funding.
  • APRs as high as 99.9%.
  • Charges an origination fee of up to 10% of the loan amount.
  • Do not offer pre-approval with soft credit pull.
  • Charges a late fee .
  • No co-sign option.

What rates and terms does Regional Finance Personal Loans offer?

Regional Finance Personal Loans has higher interest rates than the average for lenders reviewed on SuperMoney.

What APR rate does Regional Finance Personal Loans offer?

Regional Finance Personal Loans offers a fixed APR personal loan product that ranges from 21.99% APR up to 99.9% APR.

Your APR can vary depending on several factors, such as your credit score. Find out what your credit score is and whether there is any false or inaccurate information in your credit history with these credit monitoring tools.

How much can you borrow via Regional Finance Personal Loans?

Loan amounts start at $600 and go up to $10,000.

What can a personal loan from Regional Finance Personal Loans be used for?

Personal loans from Regional Finance Personal Loans are typically used for special purchases, debt consolidation, weddings, unexpected expenses or similar purposes.

What is the maximum loan term you can get with Regional Finance Personal Loans?

Regional Finance Personal Loans offers personal loans with terms ranging from 6 to 60 months. Having the option of longer terms allows borrowers to take on larger loan amounts while keeping monthly payments more affordable. However, the longer the term of your loan, the more interest you will pay.

Regional Finance Personal Loans Rates & Terms

Loan Amount $600 – $10000
Loan Term 6 – 60 months
APR 21.99% – 99.9%

What fees does Regional Finance Personal Loans charge?

Does Regional Finance Personal Loans charge an origination fee?

Regional Finance Personal Loans may charge a loan origination fee of up to 10% of the loan amount.

Does Regional Finance Personal Loans charge a late fee?

Yes, Regional Finance Personal Loans may charge borrowers a late payment fee.

Does Regional Finance Personal Loans charge prepayment fees?

No, Regional Finance Personal Loans does not charge prepayment fees. This means you will not have to pay additional fees if you decide to pay the loan off early.

Regional Finance Personal Loans Fees
Origination Fee up to 10%
Prepayment Fee? No
Late Payment Fee N/A

What do you need to qualify for Regional Finance Personal Loans?

To qualify for personal loans with Regional Finance Personal Loans, applicants need a minimum annual income of $25,000 or higher. Regional Finance Personal Loans only considers borrowers who are employed and meet the minimum income requirement.

The Military Lending Act (32 C.F.R. § 232) prohibits lenders from charging service members more than 36% APR on credit extended to covered borrowers. APRs for the Regional Finance Personal Loans product fall outside of the MLA limits and as a result the product cannot be issued to these applicants. Active duty service members and their covered dependents are considered “covered borrowers” under the Military Lending Act.

U.S. citizens are, of course, eligible for the services offered by Regional Finance Personal Loans. Permanent resident / green card holders are also eligible to apply.

To qualify, applicants may need to provide the following documentation:

  • Recent pay stubs
  • Driver’s license
  • Proof of citizenship or residence permit
Regional Finance Personal Loans Eligibility Criteria
Minimum Age 18
Bank Account Required? No
Application Types Accepted
  • Individual Applications
  • Credit Score 590 – 720

    What is the estimated funding time for a personal loan via Regional Finance Personal Loans?

    Regional Finance Personal Loans will typically provide a credit approval decision in less than an hour and fund the loan within 1 business day.

    Does Regional Finance Personal Loans report your account activity to credit bureaus?

    Regional Finance Personal Loans reports your account activity to the following credit reporting agencies:

    Making regular on-time payments to a creditor that reports to one or more credit bureaus will demonstrate your financial responsibility and can help improve your credit score.

    Contact

    • Headquarters 979 B Batesville Road
      Greer, SC 29651

    Message from Regional Management Corp.

    For 30+ years, Regional Finance has been helping our neighbors by providing personal loans. We have 340+ branches in 9 states: AL, GA, NM, NC, OK, SC, TN, TX, and VA, where we serve more than 350,000 customers. We offer fixed rate, fixed term personal loans that our customers use to pay down higher interest debts, pay bills, buy new appliances, get extra cash, and build and strengthen their credit history. Regional Finance is owned and operated by Regional Management Corp.

    About Regional Finance Personal Loans

    Availability

    • Alabama
    • Missouri
    • New Mexico
    • North Carolina
    • Oklahoma
    • South Carolina
    • Tennessee
    • Texas
    • Virginia
    • Wisconsin

    Feature Breakdown

    No Prepayment Fee
    Origination Fee (%) Up to 10%
    Employment Statuses Considered
    • Employed Full-Time
    • Employed Part-Time
    • Retired
    • Self-Employed
    Immigration Status Considered
    • U.S. Citizen
    • U.S. Permanent Resident
    Joint Loan Applications Accepted Individual Applications
    Military Status
    • Non-Military
    • Veterans
    Minimum Age 18
    Minimum Annual Income $25,000
    Supported Income Types
    • 1099 Misc. Income
    • Cash
    • Direct Deposit (W2, SSA, SSDI)
    • Payroll Check or Prepaid Card
    • Tax Returns
    Verification Documents Required
    • Recent Pay Stubs
    • Driver License (or other photo ID)
    • Proof of citizenship/residence (Green Card)
    Credit Score Range 590 – 720
    Credit Bureau Reporting Equifax
    Customizable Payment Dates
    Funding Time Range 1 day
    Payment Options
    • Automatic Payments
    • Check by mail
    • Credit/Debit Card
    • Storefront

    Loan Amount $600 – $10,000
    APR (Fixed APR) 21.99% – 99.9%
    Loan Term 6 – 60 months

    Regional Finance Personal Loans Community Reviews

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    * SuperMoney is not responsible for third party products, services, sites, recommendations, endorsements, reviews, etc. All products, logos, and company names are trademarks™ or registered® trademarks of their respective holders. Their use does not signify or suggest the endorsement, affiliation, or sponsorship, of or by SuperMoney or them of us. SuperMoney.com is an independent, advertising-supported service. The owner of this website may be compensated in exchange for featured placement of certain sponsored products and services, or your clicking on links posted on this website. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). SuperMoney strives to provide a wide array of offers for our users, but our offers do not represent all financial services companies or products.

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    5 Best Unsecured Business Loans 2020

    By Dennis Shirshikov on March 19, 2020

    Fit Small Business’ authority on small business financing.

    Some business owners can’t or don’t want to pledge specific assets—personal or business—as security for a business loan. Many traditional lenders require business loans to be supported by collateral, such as real estate or equipment. The best unsecured business loans offer large amounts of funding—quickly—with easy-to-meet qualifications.

    Can you qualify for Payroll Protection Program Loans?

    Top 5 Unsecured Business Loans

    How We Evaluated Unsecured Business Loans

    In evaluating the best unsecured business loans, we considered a variety of lending options. The desire of some small business owners to access funds without providing specific business or personal assets as collateral was top of our minds. None of the providers we reviewed requires specific assets (e.g., business equipment or a home) as collateral, but most require a personal guarantee.

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    The providers we reviewed provide two basic types of unsecured business loans: small business lines of credit (LOC) and short-term business loans. With an LOC, borrowers have the flexibility of re-advancing the principal when they pay it back. With a term loan, business owners have longer to repay.

    The best unsecured business loans are:

    OnDeck: Best Overall Unsecured Business Loan

    An OnDeck unsecured business loan is best for prime borrowers (minimum 700 credit score) who might qualify for special interest rates as low as 9% to borrow up to $500,000. Plus, OnDeck is best for unsecured business loans up to $500,000 with credit scores as low as 500. OnDeck offers term loans and an unsecured business line of credit (LOC), and applicants might get both products.

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