10 Best Personal Loans in September 2024

Personal loans can be used for a wide range of expenses—some of the most popular are to consolidate debt and to fund major purchases. Personal loans have lower average interest rates than credit cards, which can make them a more attractive option for debt, especially when you need months or years to pay it off. They also tend to offer loan amounts larger than the limit on most credit cards—up to $100,000 or more, if you can qualify.

We'll cover the top lenders to consider for different needs and what to expect when it comes to interest rates. If you decide a personal loan isn't right for you, we've got your back with a few alternatives.

Compare current personal loan rates in September 2024

Best personal loan lenders

The following lenders offer some of the best personal loan rates or the best personal loans for a variety of purposes, including home improvement, debt consolidation, credit card refinancing, fair credit, fast funding, and more. 

1. SoFi: Best overall
2. Upgrade: Best for fair credit
3. Discover: Best for no origination fees and low rates
4. Universal Credit: Best debt consolidation loans for bad credit
5. Splash Financial: Best quick loans for good credit
6. LightStream: Best for home improvement loans and low rates
7. Best Egg: High approval rates if prequalified
8. BHG Financial: Best for large personal loans
9. OneMain Financial: Best bad-credit personal loans
10. Upstart: Best fast personal loans (for all credit types)

SoFi: Best overall

Upgrade: Best for fair credit

Discover Personal Loans: Best for no origination fees (and low rates)

Universal Credit: Best debt consolidation loans for bad credit

Splash: Best quick loans for good credit

LightStream: Best home improvement loans and low rates

Best Egg: Best for high close rates if pre-approved

BHG Financial: Best for large personal loans

OneMain Financial: Best bad credit personal loans

Upstart: Best fast personal loans for all credit types

Methodology

All the lenders on this list are partners of Buy Side from WSJ. We evaluated the best personal loans based on rates, fees, repayment terms, available loan amounts, qualification criteria, time to fund, discounts, whether secured loans are available, whether cosigned loans are available, customer service options, and more. We also considered how widely available each lender's loans are nationwide.

We evaluated 24 lenders to identify our picks. Our team of experts gathered information from lender websites, customer service departments, directly from our partners, and via email support. Each data point was verified by a separate party to make sure it was accurate and up to date.

How to choose the best personal loan

When comparing personal loans, consider the following factors.

• Eligibility requirements: Each lender has its own loan use restrictions and borrower requirements. Eliminate any options you can't qualify for based on your credit score, income, loan purpose, and location.
• Loan amounts: Make sure the lender offers the loan amount you need. Most lenders offer personal loans up to $50,000, but some borrowers may qualify for a loan of up to $200,000. Some lenders may have minimums as well, and you should never borrow more than you need.
• Rates and fees: If you prequalify with a few different lenders, you can compare the estimated APR of different loan options. The APR accounts for both the interest rate and upfront fees, so you can use it to compare the annual cost of borrowing apples to apples. You should also check the lender's fee schedule to understand what late fees or check return fees you may owe—some lenders don't charge any fees.
• Repayment terms and monthly payment: Lenders may offer multiple repayment terms. Shorter terms cost less over time, but you'll also want to make sure you can afford the monthly payment.
• Funding time: Most lenders fund personal loans within a week, but some offer same-day funding for borrowers who sign their documents in time. If you need an to cover an emergency expense, the funding speed could make all the difference.
• Customer support: You can get a sense of how the lender fares in terms of customer satisfaction by checking reviews on third-party websites like Trustpilot. Check the lender's customer support options to make sure it will be convenient to reach out if you need help.

Check Out: Best Emergency Loans

• Loan options: If you want to apply with your spouse or a cosigner, or if you're looking to secure the loan with collateral, make sure the lender allows for those options. If you want to be able to manage your loan from your phone, check app reviews.
• Perks and discounts: Some lenders offer savings opportunities, like Autopay discounts or relationship discounts. Some also offer online tools and resources. Some debt consolidation lenders offer to pay your creditors directly. If any of these features are important to you, they could help break a tie.

Types of personal loans

Secured vs unsecured loans

Most personal loans are unsecured, which means the borrower is not required to put forth an asset as collateral. Secured loans require collateral, which the lender can take if the borrower fails to repay the loan. That gives the lender recourse and lowers their risk, which allows the lender to offer a lower interest rate if the loan is secured. Secured loans may also be easier to qualify for with credit issues. Both loan types can damage your credit if you miss a payment.

Fixed vs variable interest rate loans

Most personal loans are fixed-rate loans, which means the interest rate stays the same over the life of the loan, and the monthly payments are predictable. With a variable interest rate loan, the interest rate is pegged to an index rate, such as the prime rate, and varies periodically according to changes in the index rate. That can cause your monthly payment to vary.

Many credit card agreements have a variable-rate APR. Credit card rates are relatively high in 2024 because the federal funds rate is high, and the prime rate follows the federal funds rate. Currently, credit cards have an average interest rate of 21.59%, according to the Fed. The average 2-year personal loan interest rate is much lower, at 12.49%.

Common uses for personal loans

Personal loans can be used for almost any legal expense, though some lenders may prohibit borrowers from using the funds to pay for postsecondary education, real estate, investments, or business expenses.

Some common ways to use a personal loan include:

• Debt consolidation
• Emergency expenses
• Medical bills
• Home repairs and remodeling
• Large purchases
• Moving expenses
• Planning a wedding or starting a family
• Buying a vehicle

How to apply for a personal loan

1. Prequalify: After narrowing down your options based on the factors above, prequalify with a handful of lenders. Prequalification allows you to get an estimate of your APR with each lender for the sake of comparison. It won't hurt your credit. To prequalify with multiple lenders at once, use a personal loan marketplace.
2. Choose a loan offer: Compare the rates and terms of each loan offer, keeping in mind other factors, such as customer support and discounts. Choose the option that best meets your needs.
3. Formally apply: To continue with the loan offer of your choice, you'll likely need to authorize a hard credit check, which will cause your credit score to dip slightly. You'll need to upload your driver's license or passport to prove your identity. You'll also need to provide the lender with additional information about your employment situation and documents that prove your income.
4. Sign your loan agreement: If you're approved, review your final rate, which may differ slightly from your estimated rate. Read your loan documents and make sure you understand the terms. Then, e-sign your loan agreement to initiate the deposit into your bank account.

Related: How To Get a Personal Loan

Tips to improve your chances of approval

If you have a low income or credit issues, getting approved for a personal loan may prove challenging, but there are a few ways to increase your approval odds.

• Work on your credit: You're more likely to qualify with a higher credit score, so if you can wait to take out a loan, it's worth building credit first. Making on-time payments and paying down debt will help. If you pay your rent and utilities on time, you can also use a tool like Experian Boost or StellarFi to potentially improve your score.
• Compare lenders: Some personal loans are geared toward borrowers with less-than-perfect credit. Do your research to determine which lenders you're eligible for before prequalifying.
• Apply with a cosigner or co-applicant: If you have a friend or family member with good credit, applying with them may help you get approved. Look for lenders that allow cosigners or joint applicants. Make sure you can afford the loan—your cosigner or co-applicant will be on the hook for the balance if you fail to repay.
• Secure the loan: Some lenders offer the option to secure a personal loan with an asset such as your vehicle. Securing the loan may help you get approved, but you'll also risk losing the asset if you default, so make sure you have room in your budget for repayment.

Average interest rates for personal loans

The chart below shows the average interest rate borrowers qualify for in each credit tier. Note that shorter terms tend to correspond with lower interest rates. The loan amount you apply for can also impact your interest rate.

Where are interest rates headed?

Personal loan rates are higher, on average, than they were a decade ago. But several factors impact whether rates trend upward or downward in the future:

• Lenders tend to charge higher interest rates during periods of high inflation to adjust for the reduced purchasing power of fixed-interest income from loans.
• The Federal Reserve uses monetary policy to combat inflation, raising the federal funds rate to discourage economic activity. A high federal funds rate makes it more costly for banks to borrow from one another in the short term, and banks pass those costs onto consumers in the form of higher interest rates on personal loans and other credit products.
• Lenders may increase interest rates when demand for personal loans is high because they have a limited supply of money to lend.

The Federal Open Market Committee left the federal funds rate steady at its last meeting, but at least one rate cut is expected in 2024. Positive personal consumption expenditures data and a surprisingly weak July jobs report have paved the way for a rate cut as soon as September.

Based on the analysis of experts and the Fed's statement, it's unlikely that average personal loan rates will change significantly in 2024.

Best personal loans for different needs

FAQ

What are the best personal loan options for different credit scores?

Borrowers with excellent credit generally have their pick of the best personal loans and should choose a lender with low rates and no fees. Fair and poor credit borrowers will find it challenging to find a low interest rate personal loan, and may have better luck applying with a co-applicant or opting for a secured personal loan. No matter your credit score, you should prequalify with several lenders to ensure you get the lowest rate.

How can I improve my chances of getting a personal loan?

If you have a low income or credit issues, you can improve your chances of getting a personal loan by applying with a co-applicant or securing the loan with collateral.

What documents do I need to apply for a personal loan?

When applying for a personal loan, you may need to provide documents that prove your identity, income, and employment status. For example, you may need to upload a photo of your driver's license, your paystubs, and last year's tax returns.

Are there any hidden fees or charges with personal loans?

Personal loan lenders may charge fees beyond the interest rate, but they're required to disclose those fees under the Truth in Lending Act. The disclosure must include the APR, which is the annual borrowing cost, including interest and upfront fees, as well as late fees, prepayment penalties, and service charges.

How long does it take to get approved for a personal loan?

Approval times for personal loans range from a few minutes to several days. Some online lenders can approve and fund your loan as soon as the same day you submit your application. Banks and credit unions can take longer, depending on whether you already have an account.

What are some alternative loan options if I can't get approved for a personal loan?

If you can't get approved for a personal loan, you might want to consider alternatives that don't require a credit check, such as a 401(k) loan, payday alternative loan from a credit union, or cash advance app. You can also borrow from friends or family or speak with a nonprofit credit counselor if you're having ongoing money troubles.

Can I get a personal loan with a co-signer?

Very few personal loan lenders allow cosigners, but several lenders allow co-applicants. A co-applicant with good credit may help you get approved at a lower rate. Like a cosigner, a co-applicant takes responsibility for the loan if you fail to repay. The only difference is that a co-borrower has access to the loan funds, unlike a cosigner.

What should I consider when choosing a personal loan lender?

When choosing a lender, consider what rate and term options you're eligible for, the amounts offered, the lender's reputation for customer service, how quickly you'll receive the funds, and any restrictions.

Read More:

• How To Get a $10,000 Loan
• How To Get a $20,000 Loan
• How To Get a Personal Loan With a 500 Credit Score
• Best No-Credit-History Loans
• Best Loans for Bad Credit
• Best Personal Loans for Fair Credit
• Best Personal Loans for a 600 Credit Score
• Best Personal Loans for the Self-Employed
• Best Auto Repair Loans
• Home Improvement Loans