Best Personal Loans for 2022
Personal loans are a flexible financing option that offers short to medium repayment terms and fixed interest rates. Personal loans can be used to finance a new business, consolidate debt, pay medical bills, home improvement and many other uses. The best personal loans depend on the interest rate, repayment terms, fees, credit requirements and the reason the borrower needs the loan.
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5 Best Personal Loans
- SoFi: Best for good to excellent credit
- Avant: Best for bad credit
- Payoff: Best for credit card consolidation
- Rocket Loans: Best for quick funding
- LightStream: Best for home improvement
SoFi – Low Rates With No Hidden Fees
With no fees and low-interest rates, SoFi is the best personal loans choice for people with good to excellent credit. Customers can borrow up to $100,000 at an APR between 5.99% and 20.69% with a minimum credit score of 680. The lack of fees means that customers with excellent credit only need to pay the 5.99% interest rate. As such, this is a great low-cost option for people with good enough credit.
Avant – Credit Scores As Low As 550
Because Avant accepts credit scores as low as 550, this is the best personal loans option for borrowers who have bad credit. Loans are available for amounts between $2,000 and $35,000 at an APR of 9.95% to 35.99%. Funds are available as soon as the day after approval. The low credit requirements make it possible for people with damaged credit to obtain a personal loan and rebuild their credit by paying on time. Because borrowers can find out if they qualify without impacting their credit score, it is a low-risk way to shop for credit without further damaging one’s credit.
Payoff – Consolidate Multiple Credit Card Payments
The Payoff Loan™ makes it possible for customers to consolidate multiple high-interest credit card payments into one lower-rate monthly payment. Customers can borrow between $5,000 and $40,000. APRs range from 5.99% to 24.99% and it requires a minimum credit score of 640. This service offers fixed monthly payments and no late fees and claims paying off credit cards with its loan can boost credit scores by 40+ points. These loans are specifically designed to be the best personal loans to help people pay off their high-interest credit card debt and for customers with good credit, the lower interest rates may significantly reduce interest payments. Additionally, they allow borrowers to make one fixed payment for all of their debt.
Rocket Loans – Same-Day Funding
Customers applying for a loan through Rocket Loans can be pre-approved in seconds and may be able to receive funds the same day they apply, making this the best personal loans option for people who need cash fast. The company offers loans up to $45,000 with an APR of 7.16% to 29.99% with a minimum credit score requirement of 580. The loans feature no pre-payment penalties or hidden fees. The credit requirements for these loans are not as high as some of the other lenders, but the main draw is how fast borrowers can get their money, making this an attractive option for people who need immediate funds to cover emergency expenses.
LightStream – Low APR for Home Improvement Loans
LightStream offers home improvement loans with rates from 3.99% to 16.99% with AutoPay. There are no fees and no home equity requirements. Customers can receive funds as early as the same day they apply and repay them in two to 12 years. It requires a minimum credit score of 660. The low APRs make this the best personal loans option for customers with good to excellent credit who need a home improvement loan.
What This Means for You
The best personal loans product for you depends on what you want to use the loan for, how fast you need the money and what kind of credit you have. Customers with good to excellent credit should go with the lenders who offer the lowest interest rates and best perks. However, customers with specific needs or poor credit may need to exchange higher rates for lower credit requirements or faster speed.
Some lenders will approve and fund loans on the same or next day, while others can take as long as a week.
Personal loans are offered by brick-and-mortar banks and credit unions as well as online lenders.
Lenders have different credit score requirements. Even lenders catering to borrowers with poor credit usually won’t lend to people with extremely low scores, but options are available for most borrowers.
If you’re looking for a loan to consolidate credit card debt you can find our guide here.