Loan details:
What to know: If you have a credit score of at least 580 and a personal annual income of more than $100,000, you may qualify for Best Egg’s lowest APR rates. This lender charges an origination fee of 0.99% - 8.99% but won’t penalize you with a fee if you prepay your loan. With Best Egg, you can also get quick results by finding out whether you qualify for a loan within just a few minutes and receive your funds in one to three days.
To learn more, read our full Best Egg review.
Loan details:
What to know: According to its website, Happy Money offers loans specifically (and only) to help borrowers pay off high-interest credit cards. While Happy Money does charge borrowers an origination fee (0.00% - 5.00%) for its unsecured personal loans, the company does not charge application or late payment fees. In order to qualify for a Happy Money unsecured loan, you’ll need to have a credit score of at least 640, a credit history of at least three years, a 50% or less debt-to-income ratio and no unresolved payment delinquencies.
To learn more, read our full Happy Money review.
Loan details:
What to know: With a $1,000 minumim, LendingClub offers one of the lowest borrowing limits on our list. Borrowers may receive their loan disbursement within 24 hours of approval and can also skip application and prepayment fees. Many of LendingClub’s applicants find out whether they are preapproved for an unsecured personal loan within minutes. Keep in mind, however, that LendingClub does charge borrowers an origination fee (2.00% - 6.00%).
To learn more, read our full LendingClub review.
Loan details:
What to know: With some of the lowest APR rates on the market, there are many advantages to getting an unsecured loan through LightStream, including its unusually high maximum loan amount of $100,000. (Keep in mind that these low rates are typically reserved for those with excellent credit scores.)
This lender charges zero fees — that means no origination fees, prepayment fees or late fees. However, one downside of LightStream is that the company does not offer preapproval services, so you’ll have to go through a hard-credit check to see what rates and terms you may qualify for.
To learn more, read our full LightStream review.
Loan details:
What to know: Unsecured loans from Old National Bank are capped at 25% APR, whereas some lenders have APRs that can go as high as 36%. On top of that, this lender also offers a 0.25 point discount on the interest rate if borrowers sign up for autopay with an Old National Bank checking account. Old National Bank does charge a $50 processing fee, however, which is incorporated into the loan.
To learn more, read our full Old National Bank review.
Loan details:
What to know: While PenFed Credit Union lets borrowers avoid prepayment, application and origination fees, the company does charge a $29 late payment fee. Once you’re approved for an unsecured personal loan, borrowers can expect to receive their funds within one to two business days via direct deposit. While you don’t have to become a PenFed member to apply for a loan, you will have to join if you accept a loan.
To learn more, read our full PenFed Credit Union review.
Loan details:
What to know: SoFi is another lender that charges no required fees. However, unlike LightStream, SoFi does offer soft-credit inquiries so you can see what rates and terms you qualify for without putting a dent in your credit score. This company not only extends unemployment protection to borrowers so you can temporarily modify your loan payments, it also offers same-day funding once you’re approved for a loan.
To learn more, read our full SoFi review.
Loan details:
What to know: Upgrade not only has loan repayment terms of up to 24 to 84 months, borrowers can also receive funding in as little as one day. While this lender doesn’t charge any prepayment fees, Upgrade borrowers will have to shell out for an origination fee (1.85% - 8.99%) as well as late payment penalties. Upgrade offers loans to refinance credit cards, debt consolidation, home improvement projects and other large purchases.
To learn more, read our full Upgrade review.
Loan details:
What to know: This lender provides a quick, easy online process for you to check whether you prequalify for an unsecured personal loan. Like many companies, Upstart does not charge prepayment fees; however, borrowers will have to budget for an origination fee (0.00% - 10.00%) that will be taken out of their total loan lump sum. Another positive to Upstart is that borrowers can receive their funds within one business day after they’re approved.
To learn more, read our full Upstart review.
Loan details:
What to know: Not only do Wells Fargo Bank customers get to skip out on origination, closing and prepayment fees, but you may also get your funds as early as the same day you’re approved for an unsecured personal loan. However, Wells Fargo Bank may charge you late or returned payment fees, and they have a high minimum loan amount. This company is among a handful of lenders on this list that offer funds up to $100,000, and offers loan terms up to 12 to 84 months.
To learn more, read our full Wells Fargo Bank review.
Unsecured loans don’t require collateral, such as a home, vehicle or savings account, to back the loan. Instead, they are backed only by the borrower’s creditworthiness and promise to repay the loan. A common type of unsecured loan is a personal loan.
Unsecured personal loans generally range from about $1,000 to $50,000. They’re typically repaid in fixed monthly payments over a set period of time, typically two to five years. They’re offered by banks, credit unions and online lenders.
Every lender will have their own qualifications you’ll be required to meet in order to be approved for a loan. However, there are several common threads that many lenders typically follow.
Interest rates on unsecured personal loans can vary widely depending on the credit rating of the borrower as well as the loan terms, such as loan amount and length.
Most unsecured personal loan lenders require borrowers to have good or excellent credit (defined as a FICO score of 670 or above, or a VantageScore of 661 or higher). Your chances of qualifying for a loan will be much lower if you have fair or poor credit, or a history of missed payments, debt collections or charge-offs by lenders for debt you were unable to pay.
It’s possible for consumers with good or excellent credit to get a personal loan with a low interest rate, but bad-credit applicants will have a hard time qualifying for an affordable personal loan — if they receive any offers at all. Although, you still may be able to find a reputable provider for a personal loan with bad credit.
Be on the lookout for lenders advertising unsecured loans for bad credit or unsecured loans with no credit check — these often aren’t standard personal loans. Most likely, they are payday loans, which are often predatory and come with short repayment terms and high interest rates.
An unsecured loan can be a good option for many consumers, but they may be best for the following types of borrowers:
While personal loan requirements vary from lender to lender, to evaluate your creditworthiness, lenders will typically take your credit profile, income and debt-to-income ratio into consideration.
Your credit score, usage and history are some of the largest determining factors during the unsecured loan approval process. These details will also impact the loan amounts, terms and rates that lenders may offer you. If you have a low credit score, it may be wise to work on improving your credit score before applying for an unsecured loan. You can check your credit score for free with LendingTree.
Checking your credit profile is also an important part of maintaining your credit score. Your credit score is calculated based on activity on your credit profile, so checking your credit profile and disputing any errors can impact your credit score. You can review your credit profile at AnnualCreditReport.com.
When evaluating your unsecured loan application, lenders want to be sure that you’ll be able to repay the loan. That’s why your income level is important to disclose. Your income may determine what kind of rates you are eligible for. For example, Best Egg reserves its lowest rates for borrowers who have a credit score of at least 700 and an income of over $100,000.
Your income may also play a role in determining how much some lenders are willing to let you borrow. For instance, larger personal loans may require you to have a larger income, depending on the lender.
Not only may your income be evaluated for an unsecured loan, but your level of debt compared to your income will also be taken into consideration. This is known as debt-to-income ratio (DTI). The lower your DTI ratio is, the better you look in the eyes of lenders. Some lenders, like Happy Money, require that your DTI ratio be below 50% before approving you for a loan.
While unsecured loans are a popular form of personal loans, it’s not the only type of loan available to consumers. For instance, you may want to consider a secured vs. unsecured loan. Here’s how unsecured loans compare to secured and payday loans.
| Unsecured loans | Secured loans | Payday loans | |
|---|---|---|---|
| Loan amount | $1,000 to $50,000 | $500 to $500,000 | Up to $500 |
| Loan length | Three to 7 years | 12 to 84 months | Two to four weeks |
| APR | 6% to 36% APR | 5% to 36% APR | ~400% APR |
| Credit check | Yes | Yes | No |
| Collateral required | No | Yes | No |
| Best for… | Borrowers with good credit and a steady income | Borrowers with poor credit that have valuable collateral | Borrowers who need quick cash and can afford to repay quickly |
| Bottom line | If you’re considering a home improvement project or debt consolidation, an unsecured loan may be a good option if you have good credit and can afford to repay it. | While secured loans are not without their risks, this may be a good alternative for someone trying to build their credit. Keep in mind that you’ll lose your collateral if you can’t repay. | Payday loans tend to be predatory and have exorbitant fees and interest rates (sometimes up to 400%). These types of loans are best avoided. |
While unsecured loans may offer some borrowers financial relief, it’s not a one-size-fits-all solution. If you’re unsure whether an unsecured loan is the best financial choice for you, you may want to consider a few alternative options.
A personal line of credit is a type of revolving credit account that allows you to borrow a sum of money (up to a certain amount) and pay it off over time. Unlike a loan, you do not have to borrow the entire lump sum all at once. You can choose how much you want to borrow at a given time, and interest will only be charged on the amount of money you borrow. A personal line of credit does not come with fixed rates like personal loans do, so your payments may vary month to month.
When you use a credit card, you’ll typically have to pay interest if you don’t pay off the balance before the payment due date arrives. However, some companies offer 0% intro credit card promotions to help borrowers avoid interest charges. With this approach, customers can avoid paying interest on their purchases even when the payment due date arrives. However, the 0% APR generally only lasts for a certain period of time, often 12 to 21 months.
Like a personal line of credit, a home equity line of credit (HELOC) is also a type of credit account that revolves. The difference is that a HELOC is dependent on the borrower’s home equity. When you buy a house, you’ll garner equity as you pay it off (or if the value of your home increases). With a HELOC, you can borrow against that equity up to a determined amount. Like a personal line of credit, a HELOC typically does not come with fixed rates. Instead, these rates tend to rise and fall with the financial market.
By offering a detailed and objective account of each lender’s rates and terms, LendingTree’s goal is provide you with all the information you need to make a financially sound decision specific to your situation. Our team of experts thoroughly vets and weighs each option — recommendations are not based on advertisers but rather an honest review of each lender’s offerings. By providing a full picture of what each lender has, we hope to leave you with peace of mind about your financial future. Lenders were chosen based on factors such as APR rates, loan amounts, terms, fees and credit requirements.
Unsecured debt isn’t backed by a form of collateral. For example, your typical credit card debt is unsecured — if you default, nothing is seized. Mortgage debt, on the other hand, is secured debt. If you default, you could lose your home.
Unsecured loans can come in many shapes and sizes and are not limited to one type of credit. Some common examples of unsecured loans are student loans, most credit cards and personal loans. These types of loans rely more on your creditworthiness than other financial factors.
Personal loans can be secured or unsecured, but they’re typically unsecured. Secured personal loans require some kind of collateral, such as a vehicle or savings account.
If you default on an unsecured personal loan, your credit score will take a major hit. Lenders might sell your debt to a third-party collection agency in an attempt to recover some of it, alert credit bureaus to the default or take you to court. These actions could negatively impact your credit for years.
Some payday lenders will advertise unsecured loans with guaranteed approval. This is a risky path to take, these loans come with short terms and often exceptionally high interest rates. It’s best to avoid unsecured loans with no credit check or guaranteed approval.