Best Medical Loans in 2024

A medical loan might help relieve the stress that comes with out-of-pocket medical costs.

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Written by Carol Pope | Edited by Jessica Sain-Baird | Updated July 19, 2024

Medical loan lenders at a glance

Upstart: Best for borrowers with bad or no credit

7.80% - 35.99%

36 or 60 months

$1,000 - $50,000

300

0.00% - 12.00%

Pros

  • Offers medical loans for bad credit
  • Might not need credit to qualify
  • Low rates for excellent credit

Cons

  • Could pay a high upfront fee (origination fee)
  • Only two loan terms to choose from
  • High maximum APR

What to know

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Upstart, a loan marketplace, may approve you even if you have bad (or no) credit. It only requires a minimum credit score of 300. And if you have at least an associates degree from an accredited school, Upstart might waive its credit requirements. The same may apply for those currently enrolled in and working toward an associates or higher.

Getting a medical loan with bad credit has its downsides, though. Your loan could come with a hefty origination fee and a relatively high annual percentage rate (APR).

Read our full Upstart personal loan review.

How to qualify

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Upstart’s credit requirements are looser than some, but it doesn’t approve everyone. To be eligible, you must have:

  • A U.S. address and Social Security number
  • A valid email account and bank account
  • A full-time job, job offer or verifiable source of income
  • No bankruptcies within the last year
  • No current delinquencies
  • An acceptable debt-to-income (DTI) ratio
  • Fewer than six credit inquiries in the last six months

PenFed Credit Union: Best for borrowers with excellent credit

8.99% - 17.99%

12 to 60 months

$600 - $50,000

Not specified

None

Pros

  • Offers loans as small as $600
  • Can apply with a second person
  • Credit union membership is open to anyone

Cons

  • Have to join credit union
  • Lackluster mobile app reviews

What to know

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PenFed Credit Union could be a solid choice if you need a small loan (maybe to cover an unexpected deductible). With PenFed, you can borrow as little as $600. Since it’s a credit union, you have to be a member to borrow, but anyone is welcome to join.

PenFed offers joint loans. Adding a second person to your application might help you get approved.

Read our full PenFed personal loan review.

How to qualify

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PenFed doesn’t specify many of its borrower requirements. You can prequalify and apply as a nonmember, but you’ll need to join to borrow.

Joining PenFed is simple: Fill out an application and open a savings account with a deposit of at least $5.

Upgrade: Best for borrowers with fair credit

8.49% - 35.99% (with discounts)

24 to 84 months

$1,000 - $50,000

580

1.85% - 9.99%

Pros

  • Accepts fair credit
  • Collateral could help Upgrade approve you
  • Joint loans available

Cons

  • Lowest rates require autopay and debt consolidation
  • Mandatory origination fee
  • Charges $10 late payment fee

What to know

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Fair credit won’t automatically disqualify you from online lending platform Upgrade. You can also get a secured loan and use your car as collateral. Secured loans are easier to qualify for, although you’ll lose your car if you don’t make your payments.

Beyond that, Upgrade has a few drawbacks, namely an origination fee that applies to every loan. Also, Upgrade only gives its lowest rates on debt consolidation loans.

Read our full Upgrade personal loan review.

How to qualify

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Upgrade will review your factors like your credit score, credit usage and payment history to determine your eligibility. You must also:

  • Be a U.S. citizen or permanent resident, or live in the U.S. with a valid visa
  • Be at least 18 (or the age of majority in your state)
  • Have a verifiable bank account and email address

SoFi: Best for fast medical loans

8.99% - 29.99% (with discounts)

Pricing Disclosure

Fixed rates from 8.99% APR to 29.99% APR reflect the 0.25% autopay interest rate discount and a 0.25% direct deposit interest rate discount. SoFi rate ranges are current as of 02/06/2024 and are subject to change without notice. The average of SoFi Personal Loans funded in 2022 was around $30K. Not all applicants qualify for the lowest rate. Lowest rates reserved for the most creditworthy borrowers. Your actual rate will be within the range of rates listed and will depend on the term you select, evaluation of your creditworthiness, income, and a variety of other factors. Loan amounts range from $5,000– $100,000. The APR is the cost of credit as a yearly rate and reflects both your interest rate and an origination fee of 0%-7%, which will be deducted from any loan proceeds you receive. Autopay: The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. Autopay is not required to receive a loan from SoFi. Direct Deposit Discount: To be eligible to potentially receive an additional (0.25%) interest rate reduction for setting up direct deposit with a SoFi Checking and Savings account offered by SoFi Bank, N.A. or eligible cash management account offered by SoFi Securities, LLC (“Direct Deposit Account”), you must have an open Direct Deposit Account within 30 days of the funding of your Loan. Once eligible, you will receive this discount during periods in which you have enabled payroll direct deposits of at least $1,000/month to a Direct Deposit Account in accordance with SoFi’s reasonable procedures and requirements to be determined at SoFi’s sole discretion. This discount will be lost during periods in which SoFi determines you have turned off direct deposits to your Direct Deposit Account. You are not required to enroll in direct deposits to receive a Loan.

24 to 84 months

$5,000 - $100,000

680

0.00% - 7.00% (optional)

Pros

  • Might get your loan the same day you apply
  • Offers a free consultation with a financial planner
  • Customer support available via live chat

Cons

  • Must pay optional origination fee for the lowest rates
  • High minimum loan amount
  • Won’t qualify with bad credit

What to know

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Emergency loans can be a lifesaver if you’ve been hurt in an accident or diagnosed with a surprise illness. That’s where SoFi might help. It states that, from 2022-2023, 82% of SoFi borrowers got same-day funds (excluding debt consolidation and refinance loans). However, you have to apply before 7 p.m. EST on a weekday.

SoFi loans start at $5,000, so it won’t work for everyone. And although its APRs are competitive, you have to pay an origination fee in exchange for the lowest rate.

Read our full SoFi personal loan review.

How to qualify

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In addition to a credit score of at least 680, SoFi requires borrowers to fit certain criteria:

  • You must be the age of majority in your state (usually 18 years old)
  • Only U.S. citizens or eligible residents can borrow
  • You must have sufficient income (either through employment or another source)
  • If you don’t have a job, you must have a job offer to start within 90 days

LightStream: Best for no fees

9.49% - 25.49% (with autopay)

24 to 84 months

Loan Term Disclosure

Your loan terms, including APR, may differ based on loan purpose, amount, term length, and your credit profile. Excellent credit is required to qualify for lowest rates. Rate is quoted with AutoPay discount. AutoPay discount is only available prior to loan funding. Rates without AutoPay are 0.50% points higher. Subject to credit approval. Conditions and limitations apply. Advertised rates and terms are subject to change without notice. Payment example: Monthly payments for a $25,000 loan at 7.49% APR with a term of 3 years would result in 36 monthly payments of $777.54. © 2024 Truist Financial Corporation. Truist, LightStream and the LightStream logo are service marks of Truist Financial Corporation. All other trademarks are the property of their respective owners. Lending services provided by Truist Bank.

$5,000 - $100,000

Not specified

None

Pros

  • No fees whatsoever
  • Has a rate matching program
  • Lower maximum APR

Cons

  • Must have good to excellent credit
  • Only offers large loans
  • Can’t check rates without hurting credit score

What to know

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LightStream offers fee-free medical loans. It also has a rate matching program called Rate Beat. If you get a better rate while you’re shopping around, LightStream might beat it by 0.10 percentage points (stipulations apply).

LightStream only lends to borrowers with good credit or better. And since it doesn’t offer prequalification, you have to take a hard credit hit to check your eligibility.

Read our full LightStream personal loan review.

How to qualify

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LightStream doesn’t provide concrete borrower requirements, but most of the applicants it approves have:

  • Five or more years of credit history, with a mix of accounts
  • Retirement, investment, savings and checking accounts
  • An acceptable DTI ratio
  • An excellent payment history with no delinquencies

BHG Money: Best for large medical loans

11.96% - 24.91%

36 to 120 months

$20,000 - $200,000

660

3.00% - 4.00%

Pros

  • Loans of up $200,000 available
  • Don’t need perfect credit to qualify
  • Extra-long loan terms

Cons

  • Will pay an origination fee
  • Must have an annual income of at least $100,000
  • May need to wait up to five days for funds

What to know

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If you’re looking for medical loans for surgery (or another big medical expense), consider BHG Money. This lender offers large loans and long repayment terms to match. Plus, it accepts fair credit (although a lower score will likely impact how much you can borrow).

Note that if you plan on getting a large loan, BHG Money’s origination fee could be steep. For instance, if you get a $200,000 loan, your origination fee would be $8,000, assuming you have a fee of 4.00%.

Read our full BHG Money personal loan review.

How to qualify

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BHG Money doesn’t shed much light into its borrower requirements. You must have a credit score of at least 660, and you must make a minimum of $100,000 a year. You can also check rates and eligibility with no impact to your credit.

What is a medical loan?

A medical loan is a personal loan that you use for medical-related expenses. A personal loan gives you a lump sum of money that you’ll pay back in monthly installments, including interest. People often turn to medical loans to pay for:

  • Hospital and rehab bills
  • Illnesses and injuries
  • IVF
  • Elective surgeries
  • Lasik
  • Dental work
  • Deductibles, copays and prescriptions
  • Living expenses after a medical procedure

Most loans for medical bills have fixed interest rates, which means your payment will be the same each month. This could help make budgeting easier (and may help you pay less overall interest when inflation is high).

Wondering if medical bills can affect your credit?

Prior to July 2022, unpaid medical debt could impact your credit if left unpaid for six months. Thanks to changes in credit reporting, you now have a one-year grace period before this debt will show on your report. Once you’ve paid your medical debt, the delinquency will be removed from your credit report, like it never happened.

Additionally, in April 2023, Equifax, Experian and Transunion agreed to remove unpaid medical debt under $500 from credit reports.

That said, it’s always a good idea to periodically check your credit report for errors. Disputing credit reporting errors can take some time, but the work may be worthwhile.

You can get one free report a week by visiting AnnualCreditReport.com.

Pros and cons of medical loans

Medical loans can get you out of a bind, but they aren’t a good idea for everyone. It’s essential to weigh the pros and cons before taking on any sort of debt.

ProsCons

 Peace of mind. A medical loan can alleviate financial pressure during a stressful time.

 Predictable billing. Unlike with credit cards, your medical loan payments will be the same each month.

 Lower rates. Medical loans often carry lower rates than cards for people with excellent credit.

 Interest. Medical loans don’t have a 0% APR introductory period.

 Not everyone qualifies. It can be hard to get a medical loan if you have bad or no credit.

 Might not work for small procedures. Most lenders have a minimum loan amount starting at $1,000 (or higher).

Where to find medical loans

Banks: You might find a medical loan at your bank. You may even get an APR discount for banking and borrowing. However, many banks in the U.S. no longer offer medical loans, including Chase and Bank of America. Bank loans typically require at least good credit.

Credit unions: Per federal law, credit unions are not allowed to charge APRs higher than 18.00%. Also, as nonprofits, some credit unions may be willing to help members get loans, even with so-so credit. But you must be a member to borrow, and some credit unions have strict membership requirements.

Online lenders: Online loans can be a good choice whether you have good or bad credit. Rates are generally competitive for borrowers with excellent credit. And if you have bad credit, some online lenders have looser eligibility requirements. However, online loans can come with higher fees.

How to apply for a medical loan

Applying for a medical loan follows the same process as applying for a personal loan. Here’s what you can do:

  1. Review your budget. Missing payments on your loan can cause your credit score to tumble. Look at your expenses and make sure that you can handle another monthly payment.
  2. Check your credit score. Use LendingTree Spring to get your credit score for free. You’ll need it to know which lenders you might qualify for (and if their rates are competitive).
  3. Prequalify for several loans. When you prequalify for a personal loan, you’re checking your eligibility without taking a hard credit hit. You can usually prequalify online at the lender’s website. You could also use LendingTree’s personal loan marketplace — we’ll help you check rates for free.
  4. Compare your offers. APRs are important, but also be sure to check loan terms. One loan might seem cheaper than another because it has a lower monthly payment. In reality, it may just have a longer loan term.
  5. Fill out a loan application. When applying for a medical loan, you may need to provide bank statements or W2s, as well as your ID. If the lender approves you, it will give you instructions on how and when you’ll receive your money.

How to compare medical loans

APR: Your annual percentage rate measures the total cost of your loan, including interest and fees. The higher the APR, the more expensive the loan. Lenders reserve their lowest rates for people with the highest credit scores.

Loan terms: A loan term represents how long you have to pay back what you borrowed. Typically, the longer your term, the lower your monthly payment. At the same time, a longer loan term usually means more overall interest. Choose the shortest loan term you can reasonably manage.

Loan amounts: Request a loan big enough to cover your expenses. You can’t borrow from the same loan more than once. If you need more money, you’ll have to get another loan.

Funding timeline: If you need money fast, target lenders that offer same- or next-day funds. Otherwise, you may need to wait several business days (or longer) before your loan is available.

Fees: Medical loans can come with fees, the most common being an origination fee. If a lender charges an origination fee, it will keep a portion of your loan before sending it to you. Origination fees are usually a percentage of your loan.

Lender reputation: Most lenders are legitimate, but it may be wise to do some research. Check the Consumer Protection Finance Bureau (CFPB) complaint database to get a feel for a lender’s customer service.

Medical loans for bad credit

Many lenders require good credit or better to get a medical loan (so a FICO score of at least 670). If you fall short, you may want to take time to improve your credit score before applying.

However, if you don’t have the luxury of time, the strategies below could help.

Apply for a bad-credit medical loan: Some lenders specialize in bad-credit medical loans. These come with higher interest rates, and in many cases, more fees. If you’re in dire need of a loan, the extra expense might be worth it.

Add a cosigner: You could add a second person to your application and take out a joint loan. Keep in mind, though, that both your and your cosigner’s credit will take a hit if you fall behind on your payments.

Choose a secured loan: A secured loan requires collateral, usually a valuable piece of property (like your car). Because the lender can repossess your collateral if you stop paying, it might be more willing to offer you a loan.

Alternatives to medical loans

Medical loans aren’t the only way to tackle medical bills. One of the alternatives below could be a better fit.

Consider CareCredit™

CareCredit™ could make sense if you’ll need money on a continual basis. CareCredit™ is a credit card specifically for medical, dental and vet expenses. It comes with an interest-free financing option for between six and 24 months.

However, CareCredit™ also has deferred interest. If you don’t pay your balance in full by the end of the promotional period, you’ll be on the hook for interest from the time you made the charge.

Review your bill for errors

Medical coding is complicated, and billing departments make mistakes. According to the Centers for Medicaid Services (CMS), 7.38% of Medicare payments were coded incorrectly in 2023. This led to more than $31 billion in improper payments.

Before you pay a bill, review it to make sure there aren’t any coding or clerical errors. You might consider a third-party service that will review your bill, such as Alight, but those services may cost you.

Set up a payment plan

Your hospital’s billing department may be willing to negotiate a no-interest payment plan for your medical debt. These may be available without any eligibility requirement. Even if you don’t qualify for bill reduction, you may be able to set up a payment plan.

Ask about charity care

The Affordable Care Act requires all nonprofit hospitals to provide financial assistance to those who qualify. This is called charity care. Each hospital sets its own eligibility requirements, but typically, you must be low income to qualify.

Your hospital’s billing department or a social worker may be able to help you navigate charity care.

How we chose the best medical loans

We reviewed more than 30 lenders to determine the overall best six medical loans. To make our list, lenders must offer medical loans with competitive APRs. From there, we prioritize lenders based on the following factors:

  • Accessibility: Lenders are ranked higher if their personal loans are available to more people and require fewer conditions. This may include lower credit requirements, wider geographic availability, faster funding and easier and more transparent prequalification and application processes.
  • Rates and terms: We prioritize lenders with more competitive fixed rates, fewer fees and greater options for repayment terms, loan amounts and APR discounts.
  • Repayment experience: For starters, we consider each lender’s reputation and business practices. We also favor lenders that report to all major credit bureaus, offer reliable customer service and provide any unique perks to customers, like free wealth coaching.

Frequently asked questions

It can be, but it depends on the lender. Some lenders have a high minimum credit score requirement. Others, like Upstart, are willing to work with people who have bad or no credit.

Medical loans can help or hurt your credit. Applying for a loan almost always requires a hard credit pull. This may drop your score by a few points. If you make late payments (or miss them altogether), your credit score will also suffer.
 
However, making on-time payments can have a positive impact (your payment history makes up 35% of your FICO score). Also, taking out a loan when you don’t already have one can improve your credit mix, which can also have a positive effect.

Terms on medical loans usually span from 12 to 84 months, sometimes longer (see BHG Money).

One of the most important factors mortgage companies review when you apply is your DTI ratio. This measures the amount of money you bring in compared to how much you owe. Your DTI ratio does not include medical debt.
 
Additionally, your medical debt will not impact your eligibility for an FHA loan, a USDA loan and in some cases, a VA loan.