Personal Loans in Alabama

Personal loans in Alabama are a flexible financing tool for various purposes. You can use them to consolidate high-interest credit card debt, pay for a wedding, fund IVF or adoption services, cover emergency expenses, and more. 

A personal loan is a loan you can use for almost any purpose. There’s usually no collateral required on a personal loan, and funds are delivered to you quickly. Borrowers qualify for a personal loan with their income, credit score, and debt-to-income ratio.

Personal loans are an excellent alternative to payday loans, the abuses of which are known to Alabama residents. Interest rates are better, terms allow for a reasonable payback period, and funding times can be made nearly as quickly as a payday loan.  

How to find the best personal loans in Alabama

Traditionally, personal loans are regulated through rate caps imposed by state law. Alabama state law allows payday lenders to charge $17.50 for $100 lent for a 14-day period, which equates to a 456% APR. This is one of the highest rates in the U.S. 

A personal loan is a far more affordable tool for borrowing money. Rates are capped at 36% APR in Alabama. Funding times can also be very fast for personal loans. 

Alabama does have protections through the Alabama Bureau of Loans and the Alabama State Banking Department. Lenders must follow the Small Loan Act and obtain a license from the Alabama State Banking Department to lend money to borrowers. Consumers may verify lender licenses and submit complaints through the consumer affairs division.

In our comprehensive coverage of personal loans in Alabama, we evaluated local and national lenders. At a glance, here’s what lenders in Alabama are offering: 

Lender	Rates (APR)	Max. loan amount
Credible	7.49% – 35.99%	$200,000
LightStream	7.49% – 25.49%	$100,000
SoFi	8.99% – 29.99%	$100,000
Upgrade	8.49% – 35.99%	$50,000
Happy Money	11.72% – 17.99%	$40,000
Redstone Federal Credit Union	11.39% – 18.00%	$50,000
Listerhill Credit Union	11.99% – 18.00%	Not disclosed
EVA Bank	Not disclosed	Not disclosed

Online personal loans in Alabama

You can access many online personal loan options in the Heart of Dixie, where economic landscapes vary as much as the geography. Residents across Alabama can find a loan suited to their financial circumstances. 

With the evolution of online lending, securing a personal loan, whether for consolidating debt, funding a significant purchase, or covering unexpected expenses, has become more accessible than ever. Recognizing the importance of matching borrowers with the right lender, we’ve determined the best online lenders in the state, evaluating all five and awarding each a best-for designation to guide Alabamians toward the most fitting financial solutions for their needs.

Credible – Best marketplace

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LendEDU rating: 5.0 out of 5

• Innovative online loan marketplace
• Provides prequalified loan offers from various lenders
• Empowers consumers to compare rates without affecting credit score

Credible, an online loan market platform, provides consumers with numerous prequalified loan offers from various lenders. Even better, comparing rates using Credible doesn’t affect your credit score.

This means the power to explore and contrast financial products from the comfort of your home, ensuring you lock in the best rates possible for your loans. Credible’s approach streamlines the loan comparison process and empowers Alabama residents with the information they need to make informed financial decisions.

LightStream – Best for excellent credit

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LendEDU rating: 4.8 out of 5

• Competitive interest rates
• No fees
• Loans for almost any purpose

LightStream stands out as an optimal choice for Alabama consumers with excellent credit. With its competitive interest rates and lack of fees across all loan products, LightStream appeals to good-to-excellent-credit borrowers. 

The versatility of LightStream’s loan purposes—from consolidating debts to home renovations—means there’s a loan for no matter your financial project in Alabama. 

If you have stellar credit, we’re confident you’ll find LightStream’s efficient online process and favorable terms appealing, offering a straightforward path to funding your dreams or addressing financial needs without unnecessary costs.

SoFi – Best for good credit

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LendEDU rating: 5.0 out of 5

• Unemployment protection program
• Members-only benefits, including financial planning
• Offers flexibility with loan terms

SoFi offers more than just loans; it provides a financial community. Beyond its fundamental lending services, it offers membership rewards such as financial planning and an unemployment protection program. 

Alabama residents with good credit can benefit from SoFi’s attractive benefits, such as unemployment protection and exclusive financial planning services. These features resonate in Alabama, a state that values economic resilience. 

By choosing SoFi, borrowers are not just securing a loan; they’re investing in a partnership that offers support during unemployment and empowers them with tools for financial planning.

Upgrade – Best for fair credit

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LendEDU rating: 4.9 out of 5

• Allows cosigners to increase loan approval odds
• Personalized loan offers with no impact on credit score
• Loan amounts up to $50,000

Upgrade holds its ground as an excellent option for fair-credit borrowers. By allowing cosigners, Upgrade increases the chances of loan approval for Alabamians working on building or repairing their credit. This is advantageous in a state where economic disparities can affect access to traditional financing options.

Upgrade sets itself apart with its inclusive lending practices. Its personalized loan offers, coupled with the ability to borrow up to $50,000 and to see what rates you qualify for without harming your credit score upfront, make it a valuable resource for those seeking financial flexibility and the opportunity to enhance their creditworthiness.

Happy Money – Best for credit card debt

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LendEDU rating: 4.8 out of 5

• Specializes in paying off credit card debt
• A loyal community of customers
• Online application process for ease and convenience

Perfect for those grappling with credit card debt, Happy Money leads in this niche. Its dedication to helping customers eliminate credit card debt has fostered a loyal community. 

Happy Money’s focus is pertinent in Alabama, where managing and eliminating high-interest credit card debt can be a gateway to greater financial stability. 

Its straightforward online application process removes barriers to entry, allowing residents to embark on a path to financial freedom and leaving the burden of credit card debt in the past.

Local personal loans in Alabama

You can also find personal loans from local Alabama lenders. Local credit unions or bank branches might be worth checking out if you like in-person service. Sometimes, local lenders and credit unions can offer competitive rates and potentially have more flexible credit requirements. 

If you’re not already a credit union member, you’ll need to meet eligibility requirements and join before you can take advantage of their loan products. 

Redstone Federal Credit Union – Best for no origination fees

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• No collateral required
• Loan amounts up to $50,000
• No origination fees

Redstone Federal Credit Union is the largest credit union in Alabama. You must become a Redstone Federal Credit Union member to obtain a personal loan.  

The credit union offers personal loans with APRs that range from 11.39% to 18.00% with terms of up to 72 months. Note that the top APR is only 18%, which is a requirement of credit unions but also much lower than the top APR for many lenders. Put another way, borrowers with so-so credit scores might benefit from a better APR with a local credit union. 

Personal loans require a credit check, and there is no option to prequalify for a personal loan online with RFCU; however, you can directly apply for a personal loan through your online banking account. 

Listerhill Credit Union – Best credit union + online experience

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• APR as low as 11.99%
• Highly-rated customer service and consumer-friendly technology
• No application or maintenance fees

Listerhill Credit Union offers an easy online experience with competitive rates and terms of up to 72 months. The online application is quick, but there is no option to prequalify. 

Personal loans with Listerhill Credit Union are straightforward. You’ll work with a loan officer to customize loan terms and payment options that will work for you. There are no application fees or maintenance fees. 

EVA Bank – Best for flexible credit requirements

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• Loan approval not based on credit score
• Flexible loan terms based on customer needs
• Named the top-performing bank by Business Alabama

EVA Bank’s loans stand out from many other lenders for their flexible credit requirements. The bank looks beyond your credit score and the entire financial picture in making a lending decision about you. 

Unlike many other lenders, EVA Bank doesn’t have an online preapproval or application nor disclose loan amounts or interest rates online. If you’re the type that enjoys an in-person experience at the nearest branch location, EVA Bank might be for you.

Ask the expert

Eric Kirste

CFP®

There are some considerations when choosing between online/national vs. local lenders. 1) Personal interaction: If you value personal interaction and the security of knowing who is handling your loan, applying in person might be recommended. 2) Speed of funds: If you’re looking for money quickly, an online option may be best. 3) Reputable brands: Online lenders can be as safe as loans from large or local lenders, provided the online lender is reputable. 4) Online submission of data: For online applications, you must electronically share information like your Social Security number, income, and potential access to your bank account. Online lenders take measures to keep your information secure. However, if you are uncomfortable sharing sensitive personal, financial, and account information online, applying for a loan at a physical bank or credit union may be best for you. 5) Managing your loan: Ask yourself whether you want a specific person to deal with or if online access is your bigger priority.

How to choose the best Alabama personal loan

You won’t find a single answer if you’re looking for the best personal loan. That’s because the best personal loan in Alabama is the one that gives you the best possible terms based on your unique needs and loan application. 

To get there, you’ll want to shop around. These steps can help. 

1. Understand your goals. Choosing the right lender for the best personal loan depends on what you need most out of a personal loan. Each lender is unique, and some may fit your needs better. Try asking yourself:
   • Do you need fast funding? 
   • Do you prefer to receive a decision online in minutes? 
   • Would you prefer to get a loan in person? 
   • Do you need a longer-term or a lower monthly payment? 
2. Make a short list of contenders. When you’re clear about what you need most from a loan, list lenders to check out. It’s especially helpful if the lender can pre-qualify you for a loan without a hard credit check (many online lenders do). Still, you can also visit your local bank or credit union to get an idea of their loan offer. 
3. Get prequalified. Take advantage of the lender’s prequalification tool if one is available. It’s helpful to see what interest rate, terms, and amounts you’ll qualify for to compare offers.
4. Compare offers. While most will look at the APR, you’ll also want to note the fees, term length, conditions of the loan, and other fine print details. 
5. Apply for the loan that makes the most sense. Don’t get held up by analysis paralysis. There’s no perfect loan or lender, but choose the loan that makes the most sense for you. 

If you find through the process that your credit score isn’t high enough for the lender, be sure to pull your full report from annualcreditreport.com to see what may be causing the lower score. From there, you can try to fix the issue or find a lender specializing in personal loans for borrowers with lower credit scores. 

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What can you use a personal loan for?

Ask the expert

Eric Kirste

CFP®

There are local and national lenders you may be familiar with vs. some of the online options. For extra security, ensure some unfamiliar options have a license to do business in Alabama. The Consumer Financial Protection Bureau maintains a list of state bank regulators that you can use to determine whether the lender you’re considering has a valid license.