Relocation Loans: Find Money to Help with Moving Expenses

Relocation loans, aka moving loans, are funds you can borrow to pay for a move. According to “This Old House,” moving costs an average of $8,100, with moves costing almost $2,300 more than quoted.

With numbers like these, it isn’t tough to see why relocation loans are necessary. Sometimes you have to move, be it for family or work, but you may not have the cash to pay for it. In this guide, we’ll cover how much relocation loans cost, their pros and cons, and how to get one.

How does a relocation loan work? 

A relocation loan is often a personal loan that’s unsecured. Similar to other personal loans, they’re designed to help borrowers pay moving expenses. These expenses can include:

• Hiring professional movers
• Truck rentals
• Packing supplies
• Storage units
• Security deposits for a new rental
• Travel expenses (including gas and lodging)

This list is far from exhaustive but shows some of the most common moving expenses. Relocation loans might help you close on a home loan or pay for a security deposit on a new apartment. The list of possible expenses includes anything related to moving from one place to another.

However, keep in mind that if you’re moving for a new job, most lenders want your start date to be before the date of your first payment. If this isn’t a problem, you may have several options, regardless of your credit score.

Relocation loan options 

We’ve rounded up the best choices for relocation loans, their rates, loan amounts, and more.

Lender	Rates (APR)	Loan amounts
Credible	7.49% – 35.99%	$1,000 – $200,000
Upgrade	9.99% – 35.99%	$1,000 – $50,000
Upstart	7.80% – 35.99%	$1,000 – $50,000

These choices are among the best available, but not everyone will qualify for the lowest rates. 

The reviews below focus on our top choices for borrowers with fair or thin credit, meaning:

• Fair credit refers to a FICO score between 580 and 669. This range is in the middle of the scale, showing borrowers’ credit reports might have a few issues, such as late payments or high utilization. Lenders may assign higher rates and less favorable terms to people with fair credit.
• Thin credit refers to borrowers who may have few accounts and have not had them open for long. A thin credit profile can make it difficult for lenders to assess creditworthiness, which can lead to higher rates.

Fair or thin credit can limit your relocation loan options, but the borrowers we’ve selected may have options that can work for you.

Credible – Best marketplace

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LendEDU rating: 5.0 out of 5

• Comprehensive range of loan options
• Exceptional customer service
• Excellent reputation

Credible distinguishes itself through its extensive marketplace, presenting borrowers with an impressive selection of moving loan choices and lenders. This variety ensures that almost anyone can find a loan that aligns with their financial needs and circumstances. 

Credible’s commitment to outstanding customer service guarantees a seamless and supportive borrowing process. This platform provides quality options and support to its users. For those seeking a broad array of loan products and a stress-free application experience, Credible is a prime choice.

Upgrade – Best for fair credit

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LendEDU rating: 4.9 out of 5

• Competitive interest rates
• Caters to individuals with fair credit
• Transparent and straightforward application process

Upgrade is the go-to lender for individuals with fair credit, offering competitive interest rates that make the financial aspect of moving more manageable. This lender stands out for its focus on borrowers who might not have pristine credit but are still creditworthy. 

The application process with Upgrade is clear and straightforward, aiming to remove the complexity and anxiety often associated with loan applications. This approach makes Upgrade a valuable option for those who may find the borrowing landscape daunting, especially when trying to secure funds for a move with fair credit. Upgrade’s dedication to transparency and fairness makes it a standout choice for borrowers in this credit category.

Upstart – Best for thin credit

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LendEDU rating: 4.8 out of 5

• Targets borrowers with limited credit history
• Innovative underwriting process
• Fast and straightforward online application

Upstart serves individuals with thin credit histories, employing an innovative underwriting process that goes beyond traditional credit evaluation. This approach allows Upstart to offer loans to a broader range of borrowers, including those who might not qualify with other lenders due to a lack of extensive credit history. 

The speed and simplicity of Upstart’s online application process make it easy for borrowers to apply for a loan without the usual hassle. Upstart’s dedication to innovation in underwriting and its user-friendly application platform makes it a preferred choice for those new to credit or with minimal credit history seeking financial assistance for relocation.

How much will a relocation loan cost me beyond moving expenses?

Relocation loans can increase the cost of moving due to interest and other fees, such as origination fees.

Here are factors that can affect the cost of a relocation loan:

• Loan amount: How much you borrow affects the total cost. The more you borrow, the more expensive the loan will be.
• Interest rate: The annual percentage rate (APR) is the rate you will pay on an annual basis, and it includes origination fees in the calculation. A higher APR increases the cost of borrowing.
• Loan term: The loan term also affects how much you pay. A longer loan term means lower payments but more interest and a higher cost overall due to paying interest over a longer period.

If you take out a vacation loan to pay for your move, the cost is bound to be higher than paying upfront. All relocation loans come with interest, which increases the cost of the move.

For example, suppose you take out a $5,000 loan to cover the cost of your move. You qualify for the following relocation loan:

• Loan amount: $5,000
• Loan term: 3 years
• Interest rate: 12%
• Origination fee: 3%

With this loan, your monthly payment is about $166. The total interest will be $978.58 plus an origination fee of $150. The total fees on the loan come to $1,128.58, and you pay a total of $5,978.58. Also, you receive $4,850 instead of $5,000 due to the origination fee.

In the example above, borrowing the money costs $1,128.58 more than paying upfront, and you don’t get the full amount due to the origination fee. If you don’t finance the move, you avoid $978.58 in interest charges and the $150 origination fee. However, this requires you to have the money upfront.

Pros and cons of taking out loans for moving expenses

Like all forms of financing, relocation loans have pros and cons. Weigh each of them before applying.

Pros

• Relocation loans give you quick access to the money you need, so you don’t have to delay your move.

• You can use the money for a variety of moving expenses, such as movers, deposits, or storage units.

• Pay over time, so you don’t have to have the entire amount upfront.

• Making consistent on-time payments can help you build credit.

Cons

• The interest and fees on a relocation loan increase the cost of moving.

• Taking on a relocation loan increases your debt burden, which can make it more difficult to take out other loans or lines of credit in the future.

• While paying your loan on time can boost your credit score, missing payments can have the opposite effect.

• Some lenders charge extra fees, which further increase the cost of the loan.

When taking a relocation loan makes sense

Relocation loans aren’t always the best choice due to interest and fees, but they can sometimes be the right choice. For instance, they might be the best option in the following situations:

• Urgent moves: You can sometimes delay a move, especially if you’re moving by choice. However, a relocation loan might be the best option if work or your personal life won’t let you put it off.
• Low interest rate or favorable terms: Relocation loans can have low rates or favorable terms, especially compared to alternatives such as credit cards.
• Manageable monthly payments: These loans might be suitable if you can fit them into your monthly budget.

How to get a relocation loan 

Relocation loans tend to be personal loans, and the process is similar for most personal loans. Here is how it works:

1. Estimate moving expenses. Know ahead of time about how much you expect your move to cost.
2. Apply. You may need to provide proof of identity and income, employment verification, and your list of moving expenses. The lender will review your application, credit report, income, and other factors.
3. The lender determines your loan amount. The lender will determine your loan amount based on your creditworthiness, the information you provide, and its own policies.
4. Interest rate and terms. Personal loans often have fixed interest rates. Loan terms determine your repayment and can last anywhere from one to several years.
5. Funding. If the lender approves your application, it will fund your loan based on the agreed-upon loan amount, terms, and interest rate. In most cases, money is deposited into your bank account within a few business days.

After receiving the money, you’ll begin making monthly payments on the loan. These typically begin one month after the loan is disbursed. Some lenders might offer same-day funding, but this isn’t always available.

Your credit score can have a significant impact on your loan’s rate and terms. If possible, prequalify for a loan and raise your credit score, if necessary, before applying.

Alternatives to a personal loan for moving

Relocation loans are an efficient way to finance your moving costs, but we recommend considering other financial products, too. These may differ in terms of cost, immediacy, and convenience but can offer distinct advantages compared to relocation loans.

Employer relocation package

If you’re relocating for work, your employer may offer a relocation package. This is a job benefit and differs from a relocation loan because your employer bears the costs. However, not all employers offer this, and the amount varies. A relocation loan can cover all moving expenses, but an employer package might be restrictive regarding spending.

Savings

Using your personal savings is an immediate option that requires no approval process or interest payments. However, depleting savings may put you at financial risk in case of emergencies. A relocation loan carries an interest cost but allows you to keep your savings intact.

Borrow from family and friends

Financial assistance from family and friends may be cheaper and faster than a relocation loan from a lender. However, mixing personal relationships with finances holds potential risks and may strain relationships. Borrowing from family and friends may come with flexible repaying terms but lacks the formality and professionalism of a loan agreement.

0% APR credit card

A credit card with a 0% introductory rate gives you a period of interest-free borrowing, which differs from a relocation loan that accrues interest from the beginning. A credit card could provide instant funds for relocation, but it could be expensive if you don’t repay it before the 0% offer ends. A relocation loan provides a clear schedule for repayments.

Sell unwanted belongings

An alternative to borrowing, selling items you don’t want to move can generate cash and reduce the number of items you need to move, but depending on how much you have to sell, you might not earn enough funds. Consider this option to reduce the amount you borrow if it can’t offset it altogether.

FAQ 

Can I get moving loans for bad credit?

Yes, several financial institutions offer relocation loans to individuals with bad credit. Upstart, for example, states that its minimum required credit score is 300—the lowest possible. While the terms and interest rates may not be as favorable, it’s a possibility for those with less-than-perfect credit. We always recommend shopping around and comparing lenders’ offers.

Can I get loans for moving out of state?

Yes. You may use these loans to cover all types of relocation expenses, from hiring professional movers to paying for temporary housing. However, the terms and repayment conditions may vary.

Recap: Lenders offering relocation loans

Lender	Rates (APR)
Credible	7.49% – 35.99%
Upgrade	8.49% – 35.99%
Upstart	7.80% – 35.99%