Consolidate credit cards
Replace several high-APR balances with one fixed payment and a payoff date.
Personal loans, with the real cost up front.
A personal loan gives you a lump sum that you repay in equal monthly payments over a set term. See how it works, what it costs at different APRs, and what lenders check before they say yes.
- Fixed payment. The same amount every month until the loan is paid off.
- Usually no collateral. Lenders decide mainly on credit and income.
- Compare by APR. It includes fees, so it shows the true yearly cost.
Written by the Lendli Editorial Team under our editorial policy. Last reviewed .
Check your loan options
Tell us what you need and see what lenders may offer you.
- 1Choose an amount
- 2Add your details
- 3Review offers
Submitting this form shares your information with third-party lenders or lending networks so they can respond. Lendli is not a lender. See our advertiser disclosure and privacy policy.
$1K–$50KCommon loan amounts; some lenders go higher
12–84 moTypical repayment terms
FixedMost personal loans have a fixed rate
How a personal loan works
You borrow a fixed amount and receive it in one payment, usually by direct deposit. You then repay it in equal monthly installments over a set term. Each payment covers that month's interest first; the rest reduces what you owe.
Because the balance shrinks every month, the interest part of each payment shrinks too, and more of your money goes to principal. That is called amortization, and it is why paying extra early saves the most interest.
In the chart
- Month 1: $108.25 interest, $228.64 principal
- Month 12: $79.50 interest, $257.39 principal
- Month 36: $3.61 interest, $333.28 principal
What people use personal loans for
Lenders allow most personal, family and household purposes. Many do not allow tuition, business costs, investing or gambling, so check the loan agreement.
Home repairs and upgrades
Fix a roof, replace a water heater or update a kitchen without using home equity.
Medical and dental bills
Spread an unexpected bill over months; ask the provider about a payment plan first.
Moving and relocation
Cover deposits, movers and travel when a new job or home comes up.
Weddings and big events
Fund a planned expense with a fixed budget and a clear end date.
Urgent expenses
Car repairs or travel emergencies when savings fall short.
Loan payment calculator
Estimated monthly payment
$336.89
Principal $10,000
Total interest $2,128
Total repaid $12,128
Estimates only, for fixed-rate installment loans with payments made on time. Your actual rate, fees and payment depend on the lender's review of your credit and income.
What a personal loan really costs
Three things set the total: the APR, the term and any fees. Move the sliders to see how each one changes your payment and the interest you pay overall.
Payment = P × r ÷ (1 − (1 + r)−n)
Origination fees are often deducted from the money you receive, which raises the APR above the interest rate. Prepayment penalties are uncommon on personal loans, but check before you sign.
Rule of thumb: pick the shortest term whose payment fits your budget comfortably.
Payments by loan amount and term
How much you borrow and for how long matter as much as the rate. Here is what common loan sizes cost at 12.99% APR.
| Amount | 24 months | 36 months | 60 months |
|---|---|---|---|
| $5,000 | $237.69$704 interest | $168.45$1,064 interest | $113.74$1,824 interest |
| $10,000 | $475.37$1,409 interest | $336.89$2,128 interest | $227.48$3,649 interest |
| $20,000 | $950.74$2,818 interest | $673.78$4,256 interest | $454.96$7,298 interest |
| $35,000 | $1,663.80$4,931 interest | $1,179.12$7,448 interest | $796.18$12,771 interest |
Calculated with the standard amortization formula, assuming no fees and on-time payments. To compare different APRs, see the APR table on our homepage.
What lenders check before they approve you
Every lender sets its own rules, but almost all of them weigh the same four things.
Credit score and history
Most lenders look for fair-to-good credit; the best rates usually go to scores of 740+.
Steady income
Pay stubs, tax returns or bank statements that show you can repay.
Debt-to-income ratio
Monthly debts ÷ gross monthly income. Under about 36% is a common target.
Identity and residency
Government ID, Social Security number or ITIN, and a U.S. address.
A co-signer with stronger credit can help you qualify or get a lower rate, but they become legally responsible for the debt.
Before you apply
- Pull free reports at AnnualCreditReport.com and dispute errors
- Pay card balances down to lower your utilization
- Prequalify with soft checks at several lenders
Pros and cons of personal loans
A personal loan is a strong tool for a planned expense with a clear budget. It is a poor fit if the payment would stretch you or the rate is higher than your other options.
Pros
- Fixed payment, fixed end dateYou know the exact payment and payoff month from day one.
- No collateralMost personal loans are unsecured, so your car or home is not on the line.
- Often cheaper than cardsWith good credit, APRs can be well below typical credit card rates.
- Fast fundingMoney often arrives within a few business days of approval.
Cons
- High rates with weaker creditFair or poor credit can mean APRs above 25%.
- Origination feesSome lenders deduct a fee, so you receive less than you borrow.
- Credit impactA hard inquiry and new account can dip your score briefly.
- Missed payments cost moreLate fees and credit damage follow a missed payment.
How to compare personal loan offers
Two offers with the same payment can differ by hundreds of dollars in total cost. Run every offer through these five checks.
Prequalify
Get rate estimates from several lenders with soft credit checks.
Line up APRs
Compare APR, not the interest rate, since APR includes required fees.
Check total cost
Find the total of payments in each Truth in Lending disclosure.
Read the fees
Is the origination fee deducted? What are late fees? Any prepayment penalty?
Choose and autopay
Accept the best offer and set up autopay; some lenders discount for it.
Alternatives to a personal loan
Depending on the amount and your situation, one of these may cost less.
| Option | How it works | Worth considering when |
|---|---|---|
| 0% intro APR credit card | No interest during a promotional period, then the regular APR applies | The amount is small and you can repay it before the promotion ends |
| Credit union loan | Federal credit unions cap most loan APRs at 18% | You can join a credit union and want a lower-cost lender |
| Home equity loan or HELOC | Borrow against your home at lower rates, with the home as collateral | You have equity and a large, planned project |
| Provider payment plan | Pay a hospital, dentist or contractor in installments, sometimes interest-free | The provider offers a plan with no or low interest |
Personal loan questions, answered
The questions we hear most from people weighing a personal loan.
What is a personal loan?
A personal loan is an installment loan: you borrow a fixed amount, receive it as a lump sum, and repay it in equal monthly payments over a set term, usually one to seven years. Most are unsecured, so no collateral is required.
How much can I borrow with a personal loan?
Many lenders offer $1,000 to $50,000, and some go higher for borrowers with strong credit and income. The amount you are offered depends on your credit, income and existing debts.
Can I get a personal loan with fair credit?
Often yes. Some lenders work with scores in the fair range, roughly 580 to 669 on the FICO scale, but the APR will usually be higher. Compare total cost carefully and avoid lenders that ask for fees before funding.
Do I need a co-signer for a personal loan?
Not usually. A co-signer can help if your credit or income is limited, and may get you a lower rate, but they become legally responsible for the loan if you do not pay.
Are there secured personal loans?
Yes. Some banks and credit unions offer loans secured by a savings account, certificate of deposit or vehicle. They can be easier to qualify for and cheaper, but you risk the collateral.
Is personal loan interest tax-deductible?
Generally not when the money is used for personal expenses. A tax professional can advise on your situation.
Ready to see what you could get?
Check your options in a few minutes. You are never obligated to accept an offer.