Best Personal Loan Lenders of July 2024 - NerdWallet (2024)

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Best place to get a personal loan

You can get a personal loan from online lenders, banks and credit unions. The best option is one where you can get the rate, terms and features that fit your financial situation.

Loans from online lenders

With an online lender, the process of getting a loan — from application to funding — can be completed on your own schedule without having to leave home. Online lenders typically provide the fastest funding times. Some even have same- or next-day funding.

Loans from banks

Some banks provide rate discounts and perks to existing customers. These lenders typically require borrowers to have good to excellent credit (scores of 690 or higher) to qualify for personal loans.

Loans from credit unions

To get a personal loan from a credit union, you must first be a member. Credit unions are usually more willing to lend to borrowers who have fair or bad credit (scores below 690), and federal credit unions cap interest rates at 18%.

» MORE: Online vs. in person loan: Which is better?

How to compare the best personal loan lenders

Here are things to consider as you shop for a personal loan.

Pre-qualification. Many lenders let you pre-qualify online to check your estimated interest rate and loan terms. This process involves a soft credit check, which won’t affect your credit score. It pays to pre-qualify for a loan with multiple lenders and compare offers and loan features.

Annual percentage rates. Because APRs include interest rates and fees, they offer an apples-to-apples cost comparison for borrowers deciding between personal loan offers. Use our personal loan calculator to see how APR affects monthly payments and total loan costs.

Funding time. The time it takes to get a personal loan can depend on the type of lender. Many online lenders will approve your application and send funds the same or next day after you apply. Banks and credit unions may take up to a week.

Repayment terms. Lenders may offer a wide variety of repayment terms. They typically range from two to seven years. A shorter-term loan means you’ll pay less interest while a longer term gives you lower monthly payments. Based on your budget, one may make more financial sense than the other.

Loan amount. Depending on how much money you need, certain lenders could be a better fit than others. Most lenders offer small to midsize loan amounts of $2,000 to $50,000, but some provide up to $100,000. Determining the amount you need will help you compare and decide.

Special features. See if the lender you’re considering offers any perks that could help you reach your financial goals. You may benefit from features like rate discounts for setting up autopay, financial planning or hardship assistance programs.

Explore the top personal loans and lenders in each of these categories:

Personal loan interest rates and fees

Personal loan interest rates differ by lender, and the rate you receive depends on factors like your credit score, income and debt-to-income ratio (DTI). Here’s what interest rates on personal loans look like, on average:

Some lenders charge origination fees to cover the cost of processing the loan. Lenders typically deduct the fee before sending you the funds. This one-time fee is included in the loan’s annual percentage rate, so consider this when comparing costs between lenders.

Some lenders also charge late payment fees and nonsufficient funds fees, which are charged when you don’t have enough in your bank account to cover the loan’s monthly payment.

Pros and cons of personal loans

Depending on your financial situation and the loan’s purpose, a personal loan can be the right move or one you should sidestep.

Pros

Lower starting APRs than credit cards. For borrowers with strong credit, personal loans typically have lower APRs than credit cards. While some credit cards offer 0% interest during an introductory period, the rates are generally higher after the period ends.

Fixed rates and monthly payments. Personal loans have fixed rates and monthly payments over a set term, so you always know what you owe and for how long. Other financing options like home equity lines of credit have variable rates, meaning the monthly payments fluctuate.

Flexible loan amounts. Depending on the lender and your creditworthiness, you may have access to personal loan amounts of $1,000 to $100,000. This range meets a wide variety of expenses, from small emergencies to large home improvement projects.

No collateral. Unlike home equity loans that require you to secure the loan with your house, unsecured personal loans don’t require collateral. You risk hurting your credit if you can’t repay, but you won't lose any assets.

Cons

Maximum APRs can be high. If you have a low credit score, APRs on personal loans can be higher than credit card APRs.

Possible fees. Borrowers may have to pay fees — like origination or late fees — along with their loan payments.

Increase in debt. Taking a personal loan adds debt to your budget, so it's important to factor in the additional obligation and feel comfortable about paying it off.

How to get a personal loan

Frequently asked questions

Next step: Pre-qualify for a personal loan

You can pre-qualify on NerdWallet and see rates from lenders that partner with us. Pre-qualifying triggers a soft credit check, which doesn't impact your score.

Last updated on June 3, 2024

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