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Personal Loans

No-Origination-Fee Personal Loans

An origination fee is a one-time upfront fee a lender may charge to process your personal loan application. The cost of this fee varies, but some lenders charge up to 10% of the loan amount. 

A disadvantage of this fee is that it doesn’t allow you to borrow the full loan amount. Plus, it increases your overall borrowing costs.

A few lenders offer no-origination-fee personal loans. If you can qualify for one, you might save money. To help with your search, we’ve compiled a list of lenders that don’t charge this fee.

Lenders offering personal loans with no origination fees

Taking out a no-origination fee personal loan can help you:

  • Borrow the full loan amount
  • Lower your total borrowing costs

You can get this type of personal loan from several places, including banks, online lenders and credit unions.

Below are two lenders we recommend that don’t charge origination fees. We also recommend two marketplaces that partner with some personal loan companies that don’t charge origination fees. Credible or LendingTree can help you compare multiple lenders at one time.

You’re more likely to qualify for a no-fee personal loan if you have good to excellent credit. 

Lender or marketplaceRates (APR)Loan amounts
Credible7.49%35.99%1$600 – $200,000
LendingTree5.99%35.99%$1,000 – $50,000
LightStream7.49% – 25.49%$5,000 – $100,000
SoFi8.99% – 29.99%$5,000 – $100,000

Credible – Best marketplace

LendEDU rating: 5.0 out of 5

  • Wide array of lenders
  • Real prequalified rates
  • Customized loan recommendations

Credible stands out for giving borrowers the ability to compare loan offers from various lenders in one place. It provides real prequalified rates, which include not only the interest rates but also any origination fees, giving a clearer picture of the loan’s true cost before any commitment.

 This transparency in disclosing origination fees helps borrowers avoid surprises and select the best option based on total loan cost, not just the advertised interest rate. 

Credible’s platform also personalizes loan recommendations according to your specific financial situation, taking into account factors such as potential origination fees to find the best fit.

LendingTree

LendEDU rating: 4.8 out of 5

  • Single application for multiple offers
  • Comprehensive lender reviews
  • Tools and resources for decision-making

LendingTree simplifies the loan application process, enabling borrowers to see multiple loan offers through a single application. It provides comprehensive reviews that include lender-specific origination fees, ensuring borrowers have all the information needed to make an informed decision. 

LendingTree’s resources and tools help explain how origination fees affect the overall cost of a loan, aiding in the comparison of different lenders’ offers.

LightStream – Best for excellent credit

Editorial rating: 4.8 out of 5

  • Competitive interest rates for excellent credit
  • No fees or prepayment penalties
  • Quick approval and funding process

LightStream is the go-to for borrowers with FICO scores of 740 and better. It offers competitive interest rates and stands out for its no-fees policy, which includes no origination fees. This can result in significant savings, making LightStream’s loans even more attractive to those who qualify. 

The absence of origination fees, combined with no prepayment penalties, positions LightStream as a cost-effective choice for borrowers. The quick approval and funding offer a streamlined loan experience.

SoFi – Best for good credit

LendEDU rating: 5.0 out of 5

  • Competitive interest rates for good credit
  • No fees
  • SoFi Travel gives members premium offers on flights, hotels, and rental cars

SoFi is an excellent option for borrowers with FICO credit scores of 670 and up. It offers competitive rates, and its no-fees-required policy includes origination fees. This can make a substantial difference in the total cost of the loan, rendering SoFi a more accessible and economical option.

SoFi provides additional benefits that enhance the value of its loans. Borrowers have access to referral bonuses, personalized financial planning, and travel discounts. These services benefit individuals looking to improve their financial health beyond just the immediate needs of a loan. This holistic approach to financial services, combined with competitive rates and lack of fees, makes SoFi a compelling option for those eligible for its products.

How do you know if a lender charges an origination fee? 

Most lenders disclose whether they charge origination fees on their websites. You can usually find this information at the bottom of the lender’s personal loan homepage. 

Some lenders charge origination fees on all their personal loans, while others only charge origination fees on some. Many lenders allow you to prequalify online to preview the rates and fees they might charge after you submit a complete application.

Lenders often advertise that they don’t charge origination fees as a benefit on their websites.

Why do lenders charge origination fees? 

Some lenders charge origination fees to cover the costs of processing a loan, such as underwriting and administrative expenses

Lenders charge this fee as a way to lower their risks or increase their profits from the loan. Those that don’t charge origination fees have a different business model and pay for the costs of administering the loan in other ways. Plus, they may not charge origination fees to attract potential borrowers.

How can a no-origination-fee personal loan save me money? 

No origination fee can reduce your annual percentage rate (APR) compared to a personal loan with a similar interest rate and origination fee. The APR includes interest and any upfront fees the lender charges, including origination fees. 

For example, say you prequalify for two $10,000 loans, both with a three-year term and an 8.5% interest rate. However, one has a 5% origination fee.

In that case, the loan with an origination fee would have higher total borrowing costs. The table below breaks down the cost of each loan.

Orig. feeRateTotal loan costs
No orig. fee$08.5% simple interest

8.5% APR
$11,364
With orig. fee$5008.5% simple interest

12.031% APR
$11,864.31

If the APR of a personal loan with an origination fee is lower than that of a no-origination-fee personal loan, it could be cheaper. When comparing offers, pay attention to the estimated APR.

Recap of no-origination-fee personal loans

Lender or marketplaceRates (APR)Loan amounts
Credible7.49%35.99%1$600 – $200,000
LendingTree5.99%35.99%$1,000 – $50,000
LightStream7.49% – 25.49%$5,000 – $100,000
SoFi8.99% – 29.99%$5,000 – $100,000