Just a word of caution, a personal loan can only be taken when all other options, such as borrowing money from your friends, relative and co-workers is not possible. You do not have enough home equity. You can’t loan from your retirement saving account. You also do not qualify for a 0% intro APR balance transfer credit cards, where you can put all your credit card debt and use your borrowing power to meet your cash need at 0% APR. Personal loans from banks cost high interest.
To me, the best personal loan is the one you get from your friends or relative, probably at no interest. We listed some ways to arrange for quick money when there is a sudden need. When personal loans are the best option, you should try to explore all your offers. Presenting the best offers available today for your consideration.
On readers’ request linking the best option on the top – Personalloans.com is the loan broker, where you can opt for multiple providers at one attempt. Compare the offers on their APR, fees, and maximum loan amount, to decide where you want to go.
Ground work before application for best personal loan
All options mentioned in this article, cost sufficiently high-interest rates, but, they are the best in the market right now.
There are three main things that you should take notice of when applying for a personal loan:
Will the loan amount meet your needs,
The interest % (APR), and
If there are any fees attached to the loan.
If you figure that you need $20,000, then you want to be sure that your financial institution will lend out that much money to an individual. If they do not, then you are simply wasting your time with the loan application.
The interest rate is very important and should be carefully reviewed. Ideally, you want this percent to be as low as possible given your credit rating. When comparing institutions, compare the rates second.
Finally, be sure to avoid all fees when signing up for a personal loan. Some institutions will try even try to sneak the fee into your overall loan amount. Be aware of this and negotiate your way out of fees or simply take your business elsewhere.
If the loan amount is large enough, the interest rate is generally lower, and there are no fees, be certain that you can afford the monthly payment. If you typically have an extra $500 at the end of each month, accept a loan with a payment amount of no more than $250. You will have emergencies and you want to be certain that you can always make the monthly payment.
Important – Now, bring copies of your pay stubs, tax return document or W2 (if applicable) and social security number. Continue reading the article and click on the links to finish your application process. Almost all lenders will need to check credit report and verify income before extending you a loan. And since having credit inquiry on your account makes your score go down, you want to have all the inquiries made in a short span, for personal loans, possibly in one day, so that all credit inquiries from all banks are treated as a single inquiry. Good luck!
Below are the companies providing best personal loans
Top 10 Personal Loan Option
After thorough research, our team has come up with an initial list of 10. Now it has been revised as of 2/18/2016, based on current rating and customer satisfaction.
1) Personalloans.com – They are the aggregator, they go out to different lenders to find the best rate for you. They get rave reviews from customers and they have a starting low rate of 6.35%, the rate will go up depending on your credit report and income. You can get a loan up to $35,000 if you have a good score. If I need a personal loan, I would go with PersonalLoans. Majority of our readers got the cheapest rate from personalloans.com
2) Upstart Loans – Upstart is rapidly rising to the top. Last year, they were not even in top 10. This is the place to check your eligibility second, because of their fast and superior service with lowest loan rate in the market, which start at just, yes just 4.67%. They say you are more than your credit score. They consider your education and work experience while determining your loan APR. Get your funds in the bank in just 3 days. Many borrowers reported getting less than 10% APR on their loan. One unique feature about them is fund disbursement in a day. Yes! in a day, you can expect to receive fund in your checking account.
The below lines are from an existing Upstart borrower. Isn’t this very exciting? “I was a little skeptical at first because of the low rates and the easy/online application process… I thought for sure there would be hidden costs and that it was too good to be true. So I researched online and read all these other great reviews and decided to go for it. I applied, got an awesome rate, verified my info online and over the phone, and saw the funds deposited this morning”.
3) Prosper– Known for their best customer service and quick disbursement. We’d suggest you don’t finalize a loan without checking with Prosper.com once. This company is a peer-to-peer lending operation. So, having a lower cost on the source of money (as they pay lesser interest to individual lenders, as opposed to big banks) they can afford to extend personal loan at a lower interest. With a good credit, you can get a rate as low as 6.68%.
I recently visited Prosper.com as I have an investment account with them (I lend money to borrowers there). They had a nice 6.73% APR personal loan offer for me. Your mileage may vary, depending on your credit history.
4) Avant – We consider Avant, the best direct loan provider. They have the least median interest rate, meaning, you’re expected to get lowest interest rate from Avant, compared to other places if your credit score is not among the best. Their interest rate starts from 9.95%. Avant (previously known as Avant Credit) has served more than 150,000 borrowers since 2012. They have received great customer reviews lately and they offer quite a wide variety of loan amounts – between $1,000 and $35,000.
5) Lending Club – APR starts from 6.78%. You simply enter your name, address, age, and your yearly income and the system will generate your rate. At this point, you can simply accept the offer and continue with the steps to complete the process. If funding is quick, you could receive your money in less than a week.
Before Seriously Considering Options 6-10….
Options 1-5 on this list can often be a cheaper option than your local bank or credit union, and the service can be quite good too! But, if you cannot get approved by these first five institutions, then I would say it is time to explore your local banks and credit unions. As those are really your next best option for getting some quick money in terms of a personal loan.
Their interest rates are often in between 10-15% on a personal loan and they might be simpler to work with since they are in the local area. You can just drive by at a local branch and talk to the loan officer. You may finish entire application process and receive loan approval while being in the branch. But I do encourage you to check the rates online first before you venture into the banks physically. And don’t let the loan officer talk you into a pricey personal loan.
If, however, you cannot get approved for a loan by options 1-5 or by your local bank (or credit union), then remaining options might be the right choice for you.
6) Trusted Personal Loans – Trusted Loan network is a fairly new and smaller operation than the others. You can get a quote on your loan just like any other financial institution, but if you think the quoted APR% was unfair you can typically get a hold of someone that holds a high position in the company. They’ll ask you a few questions about what you intend to do with the money and your plans to repay and if they like your answers, they might just reduce the interest rate for you. Compared to the other banks and credit unions, this might just be the breath of fresh air that you need. Loan disbursed ranges from $500 to $10,000.
7) LendUp – The process is very easy at LendUp, and they are great at getting you your money fast to fulfill your one-time cash needs. They supply funds up to $250 and require you to pay back the amount plus interest within 30 days. Because of the short time frame and quick nature of the loan, the interest rate percent is often astronomical (often 200% or more). But, if you need a couple hundred bucks now and can’t get it elsewhere, then this is probably your best option.
8) Lending Tree – This is a new company which actually broker your loan and forward to other institution for competitive quotes. They offer low-interest rate and very easy application process. Since they are new, I put them at 4th place. over the time lending tree has potential to move up to top position. Worth looking in to.
9) 100 Day Loans – This company does exactly what their name states – they offer 100-day loans, typically for $1,000 and at a rate of about 36%. So, if you are looking to borrow from this company, you’d better have a plan together when you owe your $1,300 back to the company at the hundred day mark.
10) Net Credit – The typical APR% is 36% or more and they offer upwards of $10,000. This company is quite reputable and according to the reviews, they pay quickly and respond to any concerns that you might have. If you are going to borrow the full $10,000, realize that you will need to come up with nearly $14,000 if your term is a full year. The rates are not ideal, but if you need the money this is, at least, a reputable option.
Now that you short listed your lender, time to secure the best rate from your lender. How to do that? It’s by shopping smart and making sure your credit report is accurate and error free.
How to loan shop smartly?
The best way is to start working on your computer, we are tech savvy generation. Transacting online is safer than doing it in brick and mortar branches.
Visit the loan providers listed above, fill out the forms and note the interest rate and amount of loan you are approved for.
At the end, you have your lowest price and the amount you need as a loan. You should now finish the formalities by signing the paper works and sending over documents if needed.
So here’s the list of tasks towards cheapest personal loan
Check for rates online, price shop rates, note the lowest quote (if you want to stop here, you can, then apply online) Check with your current bankers, often they have loyalty program with lower interest rate Some local banks or credit unions often lure customers to open banking relationship with them by extending a low-interest loan Get competitive quotes from various institutions or banks Only apply for loans where there’s a chance of qualifying if you know the minimum credit requirement, and you don’t meet that, do not apply.
The Personal Loan Trap
At times, it can be necessary to reach out for a personal loan, which is why I am advising you of the options above, but I urge you not to make a habit of taking out loans and living your life on payments.
When you start living life on payments (a payment on your house, your car, the furniture, the washer and dryer, and maybe even your pets), your cash flow begins to dwindle, so much so that at the end of the month you might have only $50 left. No one should ever be living this tight and it is certainly not the best practice for getting ahead in life.
The wealthy often state that the best way to grow wealth is by first getting out of debt. If you wish to be wealthy, take loans out only when you absolutely have to. And, be diligent in your search to get only the very best rates. Once you pay off the loan, make it a practice not to jump into another form of debt, but instead put your additional money into savings – or better yet, an investment.
Personal loans are almost always better option than spending on high-interest credit cards. If you need to buy a major item or need to pay a high medical bill, go for a personal loan instead of buying on a credit card. Best of luck to you and your future decisions.