Who is most likely to get approved for personal loan?
Borrowers with multiple credit cards, a mortgage, or an auto loan showing regular on-time payments may be more likely to qualify. Debt-to-income ratio: Lenders seek borrowers who make enough money to meet their current monthly financial obligations, plus loan payments.
In general, people who have a FICO® Score 8 or FICO® Score 9 of at least 670 or a VantageScore 3.0 or VantageScore 4.0 of at least 661 are considered to have good credit or excellent credit, which means they may find it easier to qualify for a personal loan.
Tip: A stable income, high credit score and low DTI ratio increase the odds you'll be approved for a personal loan. However, some personal loan lenders will consider other criteria, such as your educational background or employment history, when reviewing your application.
| Company | Forbes Advisor Rating | APR range |
|---|---|---|
| Universal Credit | 3.5 | 11.69% to 35.99% |
| Upstart | 3.5 | 7.8% to 35.99% |
| Avant | 3.5 | 9.95% to 35.99% |
| LendingClub | 3.5 | 9.57% to 35.99% |
You are almost certain to be approved by at least some lenders for a personal loan if you have good credit, make enough money to easily repay your loan, have been at your job for a while, and your debt-to-income ratio is below 35% -- even when factoring in the payment on the loan you're applying for.
Requirements for a $20,000 Personal Loan
Requirements vary by lender, but most lenders require borrowers to have a credit score in the good to excellent range — meaning a score of at least 670. Some lenders state they require stable, consistent income, while others list a minimum income requirement.
- Check the accuracy of your credit report. ...
- Improve your credit score. ...
- Prequalify before formally applying. ...
- Work on reducing your debt. ...
- Find ways to increase your income. ...
- Don't apply for too much money. ...
- Adding a cosigner or a co-borrower.
Some of the easiest loans to get approved for if you have bad credit include payday loans, no-credit-check loans, and pawnshop loans. Personal loans with essentially no approval requirements typically charge the highest interest rates and loan fees.
The most common reasons for rejection include a low credit score or bad credit history, a high debt-to-income ratio, unstable employment history, too low of income for the desired loan amount, or missing important information or paperwork within your application.
| APR range | Minimum credit score requirement | |
|---|---|---|
| Best Egg | 8.99%-35.99% | 600 |
| LightStream | 7.49% to 25.49%* with Autopay | 695 |
| Upgrade | 8.49%-35.99% | 600 |
| SoFi | 8.99%-29.49% | 680 |
How hard is it to get a $5,000 personal loan?
You will almost certainly have no problems qualifying for a $5,000 personal loan if you have a strong income and good credit. However, you may struggle to get approved if your income is inconsistent, you have a low credit score, or you have a considerable amount of debt already.
Your credit score can make or break your ability to get a $10,000 loan. Generally, it can be hard to meet personal loan requirements if your credit score is below 640.
Requirements for a $5,000 Personal Loan
Some lenders may have a strict minimum credit score requirement, while others may be willing to approve you with a lower credit score. You will also need to have a source of income and a history of paying bills and past debts on time.
Requirements will vary across lenders. However, qualifying for a $10,000 personal loan typically requires a credit score that exceeds 640, an active checking account, and a steady, verifiable income, among other factors.
Most lenders require a credit score that is at least in the mid-600s. Scores between 670 and 739 are considered "good." Lenders may also review your credit history for any potential issues such as previous bankruptcies, maxed-out credit cards, multiple new lines of credit, or a history of late payments.
The best way to increase your chances of getting a personal loan is to work on improving your credit score, maintain a checking account, have a steady income, and provide all the information that the lender needs during the application process.
| Loan Amount | Loan Term (Years) | Estimated Fixed Monthly Payment* |
|---|---|---|
| $20,000 | 5 | $415.07 |
| $25,000 | 3 | $771.81 |
| $25,000 | 5 | $518.84 |
| $30,000 | 3 | $926.18 |
The monthly payment on a $20,000 loan ranges from $273 to $2,009, depending on the APR and how long the loan lasts. For example, if you take out a $20,000 loan for one year with an APR of 36%, your monthly payment will be $2,009.
While a $2,000 personal loan is relatively easy to get, interest rates and fees vary widely depending on your credit history and personal finances.
- Being prepared.
- Having good knowledge of your file.
- Ensuring your application is complete and up to date.
- Presenting realistic figures (draw comparisons with competitors, ask that they be verified by an expert…)
- Being realistic!
Why is it so hard to get a personal loan now?
This is likely in part due to the fact that lenders tend to tighten their credit requirements during tough economic times to mitigate risks, which in turn makes it harder to get approved for a loan. Luckily, there are a few steps you can take to improve your approval odds, even in a tough economy.
The first week of the month is the best time to apply for a loan because lenders typically use this time to process new loan applications. If you apply at the end of the month, you might find that there are delays in obtaining financing.
The easiest banks to get a personal loan from are USAA and Wells Fargo. USAA does not disclose a minimum credit score requirement, but their website indicates they consider people with scores below 640, so even people with bad credit may be able to qualify.
| Best For | Average Origination Fee | |
|---|---|---|
| Upstart | Best for Low Minimum Credit Requirement | 0.00%–12.00% |
| Achieve | Best for Debt Consolidation | 1.99% - 6.99% |
| LendingPoint | Best for Repayment Terms | 0.00% - 10.00% |
| Patelco Credit Union | Best With a Co-Signer | 0.00% |
- Improve Your Credit Score. One of the best ways to ensure your qualification for a personal loan is to improve your credit score. ...
- Ask Someone To Co-Sign. ...
- Compare Lenders. ...
- Prequalify For A Personal Loan.
