Best Personal Loan Companies

In this guide, you can compare our choices for the best personal loan companies from our partners and find answers to some of the most common questions that borrowers have.

The best personal loans have low rates, no or low fees, and a variety of repayment terms to choose from. You can use the funds for debt consolidation, home improvements, or typically whatever else you need money for.

Personal loans are generally offered with fixed interest rates that are lower than other financing options, such as credit cards, allowing for a straightforward repayment process. Your eligibility and the rates you are offered are mostly based on your credit score.

4 Best Personal Loan Companies

Below are reviews of our picks for the top personal loan lenders from our partners. You can find information about interest rates, term lengths, fees, and more. Click a lender to jump down to its review:

• LightStream: Best for excellent to good credit, fast funding, no fees
• Upgrade: Best for fair to bad credit, loans under $5k, checking rates
• Upstart: Best for fair to bad credit, checking rates
• Payoff: Best for fair credit, paying off credit card debt

---

LightStream

Best for: Excellent to good credit, fast funding, no fees

---

Upgrade

Best for: Fair to bad credit, loans under $5k, checking rates

---

Upstart

Best for: Fair to bad credit, checking rates

---

Payoff

Best for: Fair credit, paying off credit card debt

---

How We Chose the Best Personal Loan Companies

In order to help you find a personal loan company, our Editorial Team reviewed our partner lenders for multiple data points.

We rated lenders based on interest rates, fees, term lengths, loan amounts, deposit time, soft credit pull availability, discounts, availability of cosigned or joint loans, BBB rating, Trustpilot rating, and extra benefits. You can learn more here.

What to Look for in the Best Personal Loan

In order to find the best personal loan, there are certain things you should consider. While the best loan for you will depend on your personal situation, here are some common things to watch out for:

Rates & Terms

Interest Rates: Look for personal loans with the lowest interest rates. The rate will have the biggest influence over the total cost of the loan, so it’s important to shop around for the lowest rate.

Repayment Terms: Lenders usually allow you to choose from a range of repayment terms. This is the amount of time you will have to make monthly payments for. Shorter term lengths result in higher monthly payments but more interest saved over time, and vice-versa for longer repayment terms. Make sure the lender you choose has a repayment term that will result in a monthly payment that fits your budget.

Available Discounts: Many lenders offer interest rate discounts to help reduce the total cost of the loan and to promote financially healthy behaviors. Most often, lenders will offer a rate discount (typically 0.25%) for setting up automatic payments. Other lenders may offer discounts for other things such as having a bank account with the lender.

Fees

Origination Fees: This fee is charged when you take out a personal loan and is calculated as a percentage of the total loan amount. Many of the best personal loan organizations don’t charge any origination fees, but some do. If there is one, be sure to consider it when calculating your total loan cost.

Prepayment Penalties: This fee is charged if you pay off your loan early. Like origination fees, most of the top personal loan companies don’t charge prepayment penalties. If you anticipate that you’ll want to pay off your loan faster than your term length requires, be sure to find a lender that doesn’t charge prepayment penalties.

Other Fees: Some lenders may charge other fees such as late fees or fees for paying with a check. Make sure to consider these fees before deciding on which personal loan is best for you.

Application Process

Soft Credit Check for Pre-Approval: Many lenders allow you to see interest rate quotes after they do a soft credit check. This won’t affect your credit score like a hard credit inquiry will, so you can shop around for rates without worrying about your credit taking a hit. Note that most lenders will perform a hard credit inquiry later on in the application process to determine if you are definitely eligible and what your rate will be.

If Co-Applicants/Cosigners Are Allowed: If you are not eligible for a personal loan on your own or would like to share the repayment responsibility with someone else, you should look for a lender that allows you to add a co-applicant or cosigner to your application. Check out our guides to learn more about personal loans with a co-applicant or personal loans with a cosigner.

Time to Funding: It will take each lender a different amount of time to process your application and disburse your funds to your bank account. If you need money sooner, be sure to choose a lender with a short funding time.

Other

Customer Reviews: It’s often valuable to read customer reviews and complaints on external sites like the Better Business Bureau and Trustpilot to see if there are any common issues with the companies you are considering that could negatively affect you.

When to Use a Personal Loan

Personal loans can be used for almost anything. That doesn’t mean that it’s a good idea to use them for everything, however.

You should make sure you are using the funds for something that will help you financially—such as paying off high-interest credit card debt or making improvements to your home—or something that is absolutely necessary like responding to an emergency.

You shouldn’t use personal loans for “wants” like a vacation or new clothes. While rates are typically lower than credit cards, they are still high enough that you shouldn’t go into debt unnecessarily.

Other common uses of personal loans include covering medical expenses, paying for a funeral, consolidating credit card debt, and paying for a wedding.

Before taking out a personal loan, be sure that it makes financial sense to go into debt for whatever you are planning to use it for. You should also calculate what your monthly payments will be to make sure you can afford them.

Personal Loan Interest Rates

Personal loans usually have fixed interest rates that won’t change over the life of the loan, making repayment straightforward and predictable.

Most lenders advertise annual percentage rates (APRs) for their loans. This includes all costs of the loan including both the interest rate as well as things like origination fees.

Your rate will mainly be determined by your credit history. Higher credit scores equal lower rates and vice-versa. Based on our past users and research, here are the rates you can expect based on your credit score:

• Excellent credit (781+): Under 12%
• Good credit (661-780): 12% – 16%
• Fair credit (601-660): 16% – 26%
• Poor credit (Under 600): 26%+

If you don’t have a good credit score, you may want to work on improving it before taking out a loan. This can help you secure a lower rate and reduce the amount of interest you pay over time.

Personal Loan Application Process

Applying for personal loans online has become much easier these days. With an emphasis on convenience, many of the best loan companies have focused on cutting the time required and difficulty of their applications.

Eligibility Criteria

Each lender has different eligibility criteria, but most personal loan lenders will look at your credit report and income. The higher your credit score and income, the more likely you are to get approved for a loan.

Online personal loan companies tend to approve borrowers who don’t have ideal credit scores more often than large banks and credit unions. Part of this has to do with a trend towards using additional criteria outside of credit history, including education, employment history, and free cash flow.

If you are a U.S. citizen you likely won't have an issue applying with any of these lenders, but for non-U.S. citizens there may be certain visa or green card requirements.

Information You’ll Need When Applying

When applying for personal loans, you will need to provide the lender with certain information so they can make a decision. For lenders with alternative credit models, you may need to provide more information, but in general, you will likely need the following:

• Identification. A driver’s license, Social Security card or number, passport, or other official form of identification.
• Proof of income. If you have an employer, you will need your W-2 forms and pay stubs. If you're self-employed, you will need your tax returns or bank statements.
• Proof of address. You will likely need an official piece of mail like a utility bill with your address on it or a copy of your lease or deed.

Pros & Cons of Personal Loans

Like any financial product, there are pros and cons to consider before taking out a personal loan. Here are a few of the most important to consider:

Pros

• Lower rates than alternatives. Personal loans typically have lower interest rates than credit cards and other financial products, making them a less expensive borrowing option if you have a decent credit score.
• Fixed interest rates. Most personal loans have fixed rates that make repayment predictable, unlike loans with variable rates that fluctuate with the market.
• Can be used for almost anything. Most lenders will let you use your personal loan funds however you see fit.
• No collateral required. Personal loans are typically unsecured meaning you don’t have to offer collateral like you do with a home equity loan or auto loan.
• Fast funding. Unlike home equity loans that can take weeks to receive your funds, you can usually get your personal loan funds within a few days.

Cons

• High rates for borrowers with bad credit. Borrowers with credit scores under 600 or so may only be eligible for loans with rates above 20% or 30%, which make them very expensive and possibly difficult to repay.
• Origination fees. While there are personal loans with no fees, most do have an origination fee of around 1% to 6%. These fees can increase the cost of the loan considerably.
• Many scams in the industry. There are many scammers in the personal loan industry trying to make a quick buck off unsuspecting consumers. Be sure you are dealing with a reputable lender before providing any sensitive information.

Personal Loans vs. Credit Cards

Personal loans and credit cards are two popular options for covering expenses, and there are some key differences between the two that you should know about.

To start, credit cards are a form of revolving credit, meaning that you can continually use them to pay for things even after you pay off your balance. Personal loans, on the other hand, are installment loans that give you a lump sum of money upfront that you pay off over time. Once you pay off a personal loan, you will have to take another one out if you need more money. Credit cards are typically better for smaller purchases that you can pay off within a month, while personal loans are better for large purchases that you want to spread out over time.

As mentioned above, personal loans also typically have lower rates than credit cards, unless you have a bad credit score. This makes personal loans a good option to refinance credit card debt. For example, if you pay off a credit card with a 30% interest rate with a personal loan with a 15% interest rate, you will save significant money.

---

Recap of the Best Personal Loan Companies

Personal Loan Resources

Personal Loan Types & Uses

• Good Credit Loans
• Fair Credit Loans
• Bad Credit Loans
• Debt Consolidation Loans
• Installment Loans
• Home Improvement Loans
• Medical Loans
• Online Loans
• Joint Personal Loans
• $100,000 Loans

Personal Loan Information

• How Do Personal Loans Work?
• Secured vs. Unsecured Personal Loans
• Common Personal Loan Charges and Fees
• Personal Loan Calculator