Personal Loans
Personal Loan Requirements and How to Meet Them
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Why we like it: Navy Federal Credit Union offers the smallest loans on our list, starting at $250. A small loan through this lender may be ideal for consumers looking to borrow under $1,000.
Overview: With a loan range of $250 – $50,000, Navy Federal Credit Union offers some of the most flexible loan amounts on our list.
Navy Federal offers personal expense loans (which can be used for expenses such as vehicle repairs, traveling and weddings), home improvement loans and debt consolidation loans.
While Navy Federal does not charge borrowers origination fees, it does charge a $29 late fee if you’re unable to keep up with payments.
Because Navy Federal is a credit union, its APR is capped at 18% since credit unions are prohibited from charging interest rates higher than 18%. This may be good news to consumers with lower credit scores as other lenders have interest rates as high as nearly 36%.
| Pros | Cons |
|---|---|
Does not charge an origination fee Flexible borrowing amounts ranging from $250 Allows you to apply with a co-borrower APRs capped at 18% | High minimum for home improvement loans ($25,000 or $30,000) $29 late payment fee Must have connection to armed forces to become a member |
Eligibility requirements: If you want to get a personal loan through Navy Federal, you’ll have to become a member. Navy Federal only serves active duty or retired service members, veterans and their family and household members.
Why we like it: At $600, this lender offers the second lowest loan amount on our list. Similar to Navy Federal Credit Union, this lender may be best for consumers who need under $1,000.
Overview: Despite not offering exact credit score criteria for borrowers, PenFed Credit Union may be a good option for those looking to find lower interest rates (especially if their credit needs some work), since the interest rates at credit unions are capped at 18%.
PenFed does not charge an origination fee and also offers a short funding timeline, disbursing your funds within one to two business days after loan approval. In contrast, other lenders may take several days before you receive funds.
If you have a low credit score, PenFed also allows consumers to apply for a personal loan with a co-borrower, which can increase your chances of getting approved. Keep in mind that your co-borrower will be on the hook for repaying the loan if you’re unable to keep up with payments.
| Pros | Cons |
|---|---|
Does not charge an origination fee Can receive your funds within one to two days of approval Cannot charge interest over 18% Allows co-borrowers | Charges late payment fee of $29 Must be a member of PenFed to receive loan funds Lack of transparency around credit score criteria |
Eligibility requirements: PenFed Credit Union requires that you become a member before you can receive your loan. Unlike Navy Federal Credit Union, however, you do not need to be a military member or be related to one. To become eligible, you’ll have to open a savings account with PenFed with a $5 deposit.
Why we like it: This lender offers a quick turnaround time for consumers, with borrowers receiving their funds within 24 hours of loan approval.
Overview: LendingClub loans start at just $1,000, although this lender does charge origination fees — ranging from 2% to 6% of your entire balance — which is taken out of the lump sum you receive.
One of LendingClub’s highlights, however, is the option to apply for a personal loan with a co-borrower. This can make it easier for those with lower credit scores to qualify, since two people are taking responsibility for the loan instead of just one.
LendingClub loans can be used for just about any purpose, including debt consolidation, major purchases and home improvement projects. You cannot use a LendingClub unsecured loan for post-secondary education, investments or illegal activity.
| Pros | Cons |
|---|---|
Allows consumers to apply with a co-borrower Most borrowers receive funds within 24 hours Can prequalify for a loan without impacting your credit score | Limited choices in loan length of 36 or 60 months Charges origination fees (2% to 6%) Does not offer loans to residents in Iowa or U.S. territories |
Eligibility requirements: LendingClub requires that you are at least 18 years old and a U.S. citizen in order to be approved for a loan. This lender also takes the following factors into consideration:
Why we like it: PNC Bank may be a good choice for you if you prefer in-person banking and want to put a friendly face to your personal loan application experience.
Overview: With more than 2,600 locations across the U.S., this lender offers small personal loans starting at $1,000.
Because PNC Bank is a brick-and-mortar business, however, you may have to visit a branch in person to get a loan.
PNC Bank offers fixed rates and charges no prepayment or origination fees. On top of that, if you have a checking account with this lender, you may receive a rate discount.
Keep in mind that the interest rates and terms you may be offered from PNC Bank may depend on where you live.
| Pros | Cons |
|---|---|
Allows for co-applicants on loans Rate discount if you have a PNC Bank checking account Does not charge origination fees or prepayment penalties | Eligibility requirements are unclear May charge late fees Rates may vary depending on location |
Eligibility requirements: To receive a PNC Bank loan, here’s what you’ll need to apply:
Why we like it: Upgrade offers extensive loan lengths of up to 24 to 84 months on top of providing fast funding (within one business day).
Overview: With its unsecured loans, Upgrade specifically focuses on credit card refinancing, debt consolidation, home improvement expenses and major purchases.
Borrowers may receive their funds from Upgrade as quickly as one business day after approval, and they can pay off their loan early without having to worry about prepayment penalties.
Keep in mind, however, that Upgrade charges an origination fee on each loan, which ranges from 1.85% to 8%. This fee will come out of the total balance that you receive, so you’ll want to factor that added cost into your budget.
| Pros | Cons |
|---|---|
No prepayment penalties May receive loan as quickly as one business day after approval Offers autopay discount | Charges a 1.85% to 8% origination fee Potentially high interest rates (as high as 35.97%) Charges $10 late fees |
Eligibility requirements: Aside from its minimum credit score criteria, Upgrade requires that have the following qualifications:
Why we like it: With Upstart’s low credit score threshold, prequalification services and fast funding, this may be a good choice for borrowers with low credit scores who need money quickly.
Overview: While Upstart limits borrowers to offer two loan terms (36 or 60 months), applicants can prequalify to check their rates and may receive their funds within one business day.
Upstart also charges an origination fee as high as 8%, which is a bit higher than what other competitors may charge for this type of fee.
While consumers can use their loans for a wide variety of purposes, Upstart prohibits borrowers from putting their unsecured loans toward:
| Pros | Cons |
|---|---|
Borrowers may receive funds in one business day Offers prequalification so consumers can check their rates Low credit score requirement (600) | Charges origination fee as high as 8% Limited options on loan lengths (36 or 60 months) No option for co-borrowing or secured loans |
Eligibility requirements: To qualify for an unsecured loan with Upstart, you’ll need to meet the following criteria:
Why we like it: Not only does OneMain Financial offer unsecured personal loans, but it also has secured loans, which may benefit those with low credit scores.
Overview: Loans with OneMain Financial are smaller overall than most other lenders on our list, with a loan range of $1,500 – $20,000. However, this lender charges an origination fee that runs from 1% to 10%, one of the highest maximum rates on our list.
Unlike many lenders on the list, OneMain Financial offers secured loans in addition to its traditional unsecured loan. If you want to receive lower rates or don’t qualify for a loan otherwise, you can put down valuable collateral, such as a vehicle.
Personal loans with this lender can be used toward debt consolidation, home projects, major purchases or life events, like recreation or purchasing vehicles.
| Pros | Cons |
|---|---|
Option to change your due date May receive funds as soon as next business day after approval Offers secured and unsecured loans | Higher interest rates than competitors Charges late fees — $5 to $30 or a percentage of your payment Small maximum amount you can borrow |
Eligibility requirements: OneMain Financial takes the following personal details into consideration when approving loans:
Why we like it: Best Egg’s competitive interest rates may make it a good option for those with good or excellent credit.
Overview: Best Egg offers some of the most competitive interest rates on our list. However, if you want to access Best Egg’s lowest interest rates, you’ll need an income of at least $100,000 and a minimum credit score of 700.
This lender offers a flexible range of loan amounts, from $2,000, as well as quick funding. Best Egg customers can receive their loan funds within one to three business days.
Best Egg does not offer loans in Iowa, Vermont, West Virginia, the District of Columbia or any U.S. territories.
| Pros | Cons |
|---|---|
May receive funds as soon as one business day Flexible loan amounts ($2,000 - $50,000) No prepayment penalties | Limited loan terms (36 or 60 months) Charges an origination fee of 0.99% to 5.99% Does not offer loans in several states |
Eligibility requirements: To be eligible for a loan with Best Egg, you’ll need to meet the following requirements:
Why we like it: LendingPoint offers quick funding as well as a wide range of flexible loan terms.
Overview: LendingPoint has one of the lowest credit score requirements on our list, making it easier for consumers with poor credit to qualify for a personal loan. However, you will have to have an annual income of at least $35,000 to qualify.
LendingPoint also offers flexible loan lengths and no prepayment penalties, making it an attractive option.
However, keep in mind that if you take out a loan with LendingPoint, you may have to pay an origination fee (0% to 7%), and residents living in Nevada and West Virginia will not be eligible for loans.
| Pros | Cons |
|---|---|
Flexible loan terms of 24 to 72 months No prepayment penalties Low minimum credit score of 620 | Low maximum loan amount of $2,000 - $36,500 Not offered in Nevada or West Virginia Charges origination fee of 0% to 7% |
Eligibility requirements: LendingPoint requires that you fall into the following categories in order to qualify for a loan:
Why we like it: Unlike most other personal loan lenders, Prosper offers a unique approach to lending with peer-to-peer loans.
Overview: Prosper is a peer-to-peer lender; instead of Prosper providing loan funding, this lender facilitates the opportunity for investors to fund your loan through its platform.
While Prosper does charge an origination fee — ranging from 2.41% to 5% — it is much lower than some of its competitors. However, Prosper also has a high maximum APR and limited loan terms.
On the other hand, borrowers with low credit scores can apply for a loan through Prosper with a co-borrower and boost their chances of getting approved.
Prosper does not offer loans in Iowa or West Virginia.
| Pros | Cons |
|---|---|
Receive funds within one business day after approval No prepayment penalties Option to apply with co-borrower | Limited loan lengths to choose from (36 or 60 months) Charges origination fee of 2.41% to 5% High maximum APR of 35.99% |
Eligibility requirements: Prosper will take the following details into account when considering your loan application:
Unsecured, meaning you do not have to put up collateral
Can be quick and easy to get
Paid back over two or three years
Low interest rates for those with good credit
Improve your credit score with on-time payments
While applying for a personal loan may not be the most exciting process, it doesn’t have to be stressful. Here are the steps you’ll follow when seeking a small personal loan:
It’s always a smart idea to receive several loan offers when shopping for a personal loan. Once you have multiple offers in hand, consider the following factors to decide which offer is best for you:
Unfortunately, if you have a low credit score, it can be challenging to find a lender that’s willing to work with you. In the eyes of lenders, the lower your credit score, the riskier you are as a borrower. Lenders use credit scores to evaluate how likely you are to repay your loan.
If your credit score needs work but you need a personal loan, here are a few strategies that may improve your chances:
While there are many trustworthy small personal loan lenders out there, it’s important to be cautious and research lenders before signing the contract. Here are a few red flags to look out for and avoid:
No credit checks: No credit checks may sound like a dream come true if you have bad credit and are in need of some extra cash. However, any credible lenders will require a credit check to ensure that you can afford to repay a loan. Payday loan lenders, for example, don’t require credit checks and should be avoided.
Require access to checking or savings accounts: Some predatory lenders may require you to provide your checking or savings account information. Once you do, these lenders are able to withdraw money from your account to repay your loan, even if it overdrafts your account and costs you bank fees.
Lack of transparency: If a lender isn’t upfront about its fees and interest rates, you may want to rethink getting a loan with them. A trustworthy lender will make that information readily available on its website or during the application process.
Sky-high fees and interest rates: Some loans, such as payday loans, come with interest rates as high as 400%, which can make it challenging to repay that debt. Many borrowers end up having to take out more loans to pay off their original loan, trapping them in a cycle of debt.
Repayment lengths: The length of time you have to repay a loan can also be an indicator of a predatory lender. Predatory lenders sometimes offer only two to four weeks for a borrower to repay a loan. This short repayment period can make it difficult to keep up with payments.
If you’re in need of extra funds, a small personal loan isn’t the only option on the table. Here are a few other alternatives to explore:
To avoid paying interest, you can apply for a 0% intro APR credit card. During the introductory period, your balance does not accrue interest, and every payment you make goes directly to the principal.
Once that promotional period ends, however, you’ll have to pay interest on the remaining balance. These promotions can last anywhere from 12 to 21 months. If you’re certain you can pay off your balance before the end of the introductory period, these cards can be a great option.
Since many retailers offer buy now, pay later (BNPL) services, you may be able to get a mini loan through a service such as Affirm or Klarna.
The most common form of buy now, pay later financing is a Pay in 4 plan. Your balance is split into four payments repaid over six weeks, with a payment due every two weeks. In many cases, these BNPL plans do not charge interest. Other common BNPL financing includes monthly installments or Pay in 30 days, though these plans sometimes come with interest charges.
If you need emergency cash, you can use a credit card to get cash quickly. This is known as a cash advance.
You can withdraw funds by going to your bank’s branch, visiting an ATM or getting a convenience check in the mail. Keep in mind, however, that cash advances typically have fees attached, as well as interest rates that can be much higher than your typical credit card APR.
If you have a loved one with the financial flexibility to offer you a loan, receiving a family loan and signing a loan agreement may be a good way to avoid fees and high interest rates.
However, when borrowing from a friend or family member, be aware that the loan could impact your relationship. According to a 2021 LendingTree study, nearly half of the people who are owed money from a loved one reported that they regretted lending it in the first place. About 1 in 6 claimed that money had ruined a relationship.
We looked at 20 lenders that offer personal loans below $2,000 to determine the 10 best lenders for consumers who are looking for small loans. By offering a detailed and objective account of each lender’s rates and terms, LendingTree’s goal is to provide you with all the information you need to make a financially sound decision specific to your situation.
Here’s the criteria we assessed to choose the best small personal loan lenders:
How much you’ll pay overall on a $5,000 will be determined by your interest rate and the length of your loan. Typically, the longer your loan, the more you’ll pay in interest.
For instance, if you take out a $5,000 loan with a 10% interest rate over a period of five years, you’ll pay $106.24 a month and $6,374.11 overall. On the other hand, if you borrow the same amount but pay 15% interest over three years, your payments will be $173.33 a month, but you’ll only pay $6,239.76 overall.
Use a personal loan calculator to estimate how much your $5,000 loan could cost you.
Small loans typically range between $1,000 and $5,000, though some loans can be as low as $100. With especially small loans, it’s important to read the fine print, as some lenders (such as payday lenders) may charge larger fees and interest rates.
Small loans can lower your credit score, but the effect is usually temporary. When lenders run hard-credit pulls to approve you for financing, the pull puts a small dent in your score, but the effect usually disappears within two years. Small personal loans can also negatively impact your credit score if you fall behind on payments or default on your loan.
Personal loans can help build your credit as you make on-time payments and eventually pay off the balance. Other ways you can improve your credit score include the following: