Personal Loans for Students
Personal loans might be an option for students who need additional funds after financial aid. The lenders below offer personal loans for students. However, before jumping in, make sure you know what you’re getting into—and what might be a better idea.
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Attending school requires funds for more than just tuition, books, and a dorm room. If you live off-campus, you may have additional living expenses for everything from rent to utilities, groceries, and much more.
After federal student loans, scholarships, grants, savings, and private student loans, many students find that they still don’t have what they need to effectively cover their costs associated with college.
If you’re finding yourself in that position after exhausting all other options, personal loans for students are an option.
On this page:
- What Students Should Know About Personal Loans
- 3 Personal Loans for Students
- Why Personal Loans May Not Make Sense for Students
- Alternatives to Personal Loans for Students
What Students Should Know About Personal Loans Before Applying
Personal loans are offered by banks, credit unions, and other types of lenders. Because they’re usually unsecured and therefore high-risk loans for the lender, they often come with higher interest rates and fees—or lower loan amount limits.
In most cases, qualifying for the best personal loans requires both a good credit score and a steady income. This shows the lender that you are likely to be able to afford to make the loan payment each month.
Most college students have a hard time meeting those requirements; they’re often not employed or don’t make enough money, and they don’t have much of a credit history built up.
The lenders below offer personal loans to students, but Boro is the only one that specializes in lending to students. In order to be eligible for the other lenders, you will likely need to add a creditworthy cosigner to your loan.
3 Personal Loans for Students
15.90% – 35.90%
$400 – $3,000
6 – 24 months
BoroCash is a personal loan created for college students and is offered through the Boro app. Funds can be used for anything you need, such as for textbooks, parking tickets, groceries, and more.
Checking your rate will not impact your credit score. Once you see your personalized rate, determine the overall cost of the loan and make sure that you can meet your repayment requirements.
BoroCash is available to current, domestic, and international students with an .edu email address. Additional requirements include:
- You must be over 18 years old
- Enrolled in a U.S. college or university or have had recently graduated
- Be a U.S. citizen, Green Card holder, or A5, C8, F1/OPT, G, H1B, J1, L1, O1 Visa holder
Age, residence state, and credit profile can all weigh on the initial approval decision.
Boro doesn’t lend in all states, but it does lend in: Arizona, Arkansas, California, Florida, Illinois, Iowa, Maryland, Michigan, Minnesota, Missouri, Nebraska, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Utah, Washington, and Wisconsin.
To get started, you’ll need to download the app and click the BoroCash tab to see how much BoroCash you qualify for.
If you’re approved, you can electronically sign your loan agreement and set up an automatic monthly payment. The proceeds from your new loan will be in your bank account within two days—sometimes the same business day.
4.37% – 35.99%1
$1,000 – $50,0002
36 or 60 months1
Upstart is an online lending platform that partners with banks to make personal loans more accessible to those with fair credit and higher. Checking your rate won’t affect your credit score and can be completed in just five minutes.3
In order to qualify for a personal loan with Upstart, you will need:
- A minimum credit score of 580
- No bankruptcies or public records on your credit report
Students considering Upstart will likely require a creditworthy cosigner to be eligible for a loan as the lender does consider employment, income, and other variables as factors.
Upstart is available in all 50 states.
Applying for a loan can be done completely online. If you are approved, you can receive your funds in as little as one business day.4
You can check your rate without impacting your credit score on its website.
7.99% – 35.97%
$1,000 – $35,000
36 or 60 months
Upgrade is a great option for borrowers with bad or fair credit, as well as those that need smaller loans. You can check rates without affecting your credit score and eligibility is based more on free cash flow as compared to other lenders.
In order to qualify for a personal loan with Upgrade, you will need:
- A minimum credit score of 620
Upgrade accepts cosigners on personal loan applications. For most students, this is recommended since approval will be based on your credit score, credit history, and other factors.
Upgrade is available nationwide, with the exception of West Virginia and Washington D.C.
Before you submit your full application, Upgrade allows potential borrowers to check their rates though a soft credit pull. If you like the rates you received, you can submit your full application online and receive your funds as soon as the next day.
Why Personal Loans May Not Make Sense for Students
Just because the option of a personal loan is available to some students doesn’t always mean it’s a good option. For most students, finding a solid lender who’s willing to offer bad credit personal loans can be extremely difficult.
Even with a cosigner—if you can get one—an unsecured personal loan can be expensive in the long term. At even an average rate of 18% APR, a $2,000 loan will cost you around $2,200 over 12 months. Most personal loans have much shorter terms than other kinds of loans; a 12-month or 24-month term is fairly standard. In a 24-month term, that $2,000 ends up costing around $2,350.
If you’re a college student who already has student loans, you may want to think twice about taking out a personal loan in addition unless you can find a loan with a good interest rate and can afford the payments, which will start immediately instead of after you finish school.
Alternatives to Personal Loans for Students
If the idea of a personal loan doesn’t sound very advantageous, you might want to look into other options first. Federal financial aid, for example, in the larger sense, is always a better option than a personal loan. Even most private student loan options will offer better rates and a more manageable repayment process.
Some schools offer grants to students who have emergency financial needs. Check with your financial aid office to see what’s available. For example, in Minnesota, some schools offer grants of $500 to $1,000 to students who are in serious financial distress, including homelessness and food insecurity.
Federal Student Loans
If you find yourself in need of money after you’ve exhausted scholarships, grants, and savings, federal loans – including Direct Loans and PLUS Loans – should be your next choice. They come with many benefits, tax advantages, and flexible repayment options, and all come with a grace period meaning that you don’t have to start repayment until six to nine months after graduation.
They also typically have the lowest interest rates of any personal loans or student loans on the market. Your parents can also take out additional student loans, in the form of Parent PLUS Loans, to help you if necessary.
Private Student Loans
The next best loan option for students are private student loans. While these private loans are offered by banks, credit unions, and lenders at typically higher interest rates (as compared to federal student loans) and with fewer benefits, they’re also somewhat comparable when it comes to loan terms and have lower interest rates than most personal loans that students may qualify for.
Some private lenders allow for interest-only payments or full deferment while borrowers are in school, and many also come with rate discounts for automatic payments or high GPAs.
In addition, many private student loan lenders have no or low loan fees which can help you save money over time. If you don’t have a good credit score or creditworthy cosigner, you can check out our guides to student loans without a cosigner and student loans for bad credit.
Getting a credit card is easy. Staying on top of the payments, however, isn’t always as simple. Various student credit cards exist, and many of them come with decent interest rates and decent rewards.
While using one of the best credit cards for everyday expenses can be tempting, they can get dangerous fast if you’re not paying your bill off each month. If you can discipline yourself to only use your card for what you can afford to purchase with cash—and then pay off you bill every month—you can see your credit rating increase quickly, which can help you become eligible for better credit offers.
Whatever choice you make, ensure that you can afford it and have a plan for repayment. The decisions you make now while in college will affect your finances for years to come; be smart, financially savvy, and reap the rewards later.
Recap of Personal Loans for Students
|Lender||Loan Amounts||Credit Score|
|Boro||$50 – $2,000||Not needed|
|Upstart||$1,000 – $50,000||580+|
|Upgrade||$1,000 – $35,000||620+|
1 The full range of available rates varies by state. The average 3-year loan offered across all lenders using the Upstart platform will have an APR of 21.98% and 36 monthly payments of $35 per $1,000 borrowed. For example, the total cost of a $10,000 loan would be $12,651 including a $626 origination fee. APR is calculated based on 3-year rates offered in the last 1 month. There is no down payment and no prepayment penalty. Your APR will be determined based on your credit, income, and certain other information provided in your loan application. Not all applicants will be approved.
2 Your loan amount will be determined based on your credit, income, and certain other information provided in your loan application. Not all applicants will qualify for the full amount. Loans are not available in West Virginia or Iowa. The minimum loan amount in MA is $7,000. The minimum loan amount in Ohio is $6,000. The minimum loan amount in NM is $5100. The minimum loan amount in GA is $3,100.
3 When you check your rate, we check your credit report. This initial (soft) inquiry will not affect your credit score. If you accept your rate and proceed with your application, we do another (hard) credit inquiry that will impact your credit score. If you take out a loan, repayment information will be reported to the credit bureaus.
4 If you accept your loan by 5pm EST (not including weekends or holidays), you will receive your funds the next business day. Loans used to fund education related expenses are subject to a 3 business day wait period between loan acceptance and funding in accordance with federal law.
Author: Dave Rathmanner