We are an independent, advertising-supported comparison service. Our goal is to help you make smarter financial decisions by providing you with interactive tools and financial calculators, publishing original and objective content, by enabling you to conduct research and compare information for free - so that you can make financial decisions with confidence.
Bankrate has partnerships with issuers including, but not limited to, American Express, Bank of America, Capital One, Chase, Citi and Discover.
The offers that appear on this site are from companies that compensate us. This compensation may impact how and where products appear on this site, including, for example, the order in which they may appear within the listing categories, except where prohibited by law for our mortgage, home equity and other home lending products. But this compensation does not influence the information we publish, or the reviews that you see on this site. We do not include the universe of companies or financial offers that may be available to you.
Checkmark Expert verified
Bankrate logoHow is this page expert verified?
At Bankrate, we take the accuracy of our content seriously.
“Expert verified” means that our Financial Review Board thoroughly evaluated the article for accuracy and clarity. The Review Board comprises a panel of financial experts whose objective is to ensure that our content is always objective and balanced.
Their reviews hold us accountable for publishing high-quality and trustworthy content.
Quick citation guide Select a citation to automatically copy to clipboard.APA: Ceizyk, D. (2024, September 17). How to get a personal loan in 9 steps. Bankrate. Retrieved September 17, 2024, from https://www.bankrate.com/loans/personal-loans/how-to-get-personal-loan/
Copied to clipboard!MLA: Ceizyk, Denny. "How to get a personal loan in 9 steps." Bankrate. 17 September 2024, https://www.bankrate.com/loans/personal-loans/how-to-get-personal-loan/.
Copied to clipboard!Chicago: Ceizyk, Denny. "How to get a personal loan in 9 steps." Bankrate. September 17, 2024. https://www.bankrate.com/loans/personal-loans/how-to-get-personal-loan/.
Copied to clipboard!
Written by
Denny Ceizyk
Denny Ceizyk joined the Bankrate Loans team as a Senior Writer in 2023, providing 30 years of insight from his experience in loan sales and as a personal finance writer to help consumers navigate the lending landscape on their financial journeys.
Edited by
Pippin Wilbers
Pippin Wilbers is a Bankrate editor specializing in personal and auto loans. Pippin is passionate about demystifying complex topics, such as car financing, and helping borrowers stay up-to-date in a changing and challenging borrower environment.
Reviewed by
Thomas Brock
Thomas is a well-rounded financial professional, with over 20 years of experience in investments, corporate finance, and accounting. His investment experience includes oversight of a $4 billion portfolio for an insurance group. Varied finance and accounting work includes the preparation of financial statements and budgets, the development of multiyear financial forecasts, credit analyses, and the evaluation of capital budgeting proposals. In a consulting capacity, he has assisted individuals and businesses of all sizes with accounting, financial planning and investing matters; lent his financial expertise to a few well-known websites; and tutored students via a few virtual forums.
Bankrate logoAt Bankrate we strive to help you make smarter financial decisions. While we adhere to strict editorial integrity , this post may contain references to products from our partners. Here's an explanation for how we make money .
Bankrate logoFounded in 1976, Bankrate has a long track record of helping people make smart financial choices. We’ve maintained this reputation for over four decades by demystifying the financial decision-making process and giving people confidence in which actions to take next.
Bankrate follows a strict editorial policy, so you can trust that we’re putting your interests first. All of our content is authored by highly qualified professionals and edited by subject matter experts, who ensure everything we publish is objective, accurate and trustworthy.
Our loans reporters and editors focus on the points consumers care about most — the different types of lending options, the best rates, the best lenders, how to pay off debt and more — so you can feel confident when investing your money.
Bankrate logoBankrate follows a strict editorial policy, so you can trust that we’re putting your interests first. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions.
We value your trust. Our mission is to provide readers with accurate and unbiased information, and we have editorial standards in place to ensure that happens. Our editors and reporters thoroughly fact-check editorial content to ensure the information you’re reading is accurate. We maintain a firewall between our advertisers and our editorial team. Our editorial team does not receive direct compensation from our advertisers.
Bankrate’s editorial team writes on behalf of YOU – the reader. Our goal is to give you the best advice to help you make smart personal finance decisions. We follow strict guidelines to ensure that our editorial content is not influenced by advertisers. Our editorial team receives no direct compensation from advertisers, and our content is thoroughly fact-checked to ensure accuracy. So, whether you’re reading an article or a review, you can trust that you’re getting credible and dependable information.
Bankrate logoYou have money questions. Bankrate has answers. Our experts have been helping you master your money for over four decades. We continually strive to provide consumers with the expert advice and tools needed to succeed throughout life’s financial journey.
Bankrate follows a strict editorial policy, so you can trust that our content is honest and accurate. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions. The content created by our editorial staff is objective, factual, and not influenced by our advertisers.
We’re transparent about how we are able to bring quality content, competitive rates, and useful tools to you by explaining how we make money.
Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for placement of sponsored products and services, or by you clicking on certain links posted on our site. Therefore, this compensation may impact how, where and in what order products appear within listing categories, except where prohibited by law for our mortgage, home equity and other home lending products. Other factors, such as our own proprietary website rules and whether a product is offered in your area or at your self-selected credit score range, can also impact how and where products appear on this site. While we strive to provide a wide range of offers, Bankrate does not include information about every financial or credit product or service.
Bankrate analyst Jared Wilder decided the best way for him to pay off high-interest-rate credit cards was to take out a personal loan. Before he decided on a lender, he spent a few hours reading up on different loan amounts and terms associated with personal loans.
“One of my main concerns was finding out what the ‘catch’ was,” Wilder explains. “Why is some bank going to hand me 25 grand? What are the rules about how I can and can’t use it?” Once Wilder had a grasp on what he would be getting into, he knew what requirements to look for.
If you have similar borrowing needs, you might wonder how to get a personal loan. In most cases, you just need a good credit score and proof of income to get a personal loan. Although getting a personal loan is relatively simple, there are some steps you can take to choose the right personal loan and increase your approval chances. The steps may vary depending on whether you’re looking for debt consolidation loans, home improvement loans, medical loans or wedding loans.
Consumers often choose personal loans because they provide fast access to cash for a variety of needs. Whether you need money to pay for an unexpected hospital bill, an emergency car repair or to finance some much-needed home renovations, knowing how to get approved for a personal loan will help make the application process as smooth as possible.
See related: The top 9 reasons for personal loansCheck your credit score before you start crunching any numbers. Personal loan annual percentage rates (APRs) can range from just below 8 percent all the way up to 35.99 percent, depending mostly on your credit score. A score of 800 or higher puts in the excellent-credit personal loan rate category, while a score of 580 or below is typically categorized as bad.
It’s more difficult to get approved for a loan with bad credit. Higher APRs mean higher payments. Lenders may not be willing to lend you as much, or they may require you to pay the loan off faster.
On the other hand, a high credit score gives you the best chance at a low personal loan rate and a larger loan amount. You’re also more likely to be eligible for repayment terms as long as seven years, versus the standard five-year term offered to lower credit score borrowers.
Next stepsBefore you get a loan, decide exactly how much you need to borrow. This will have an impact on the interest rate you’re offered, your monthly payment and the total amount of origination fees the lender charges.
Some personal loan lenders charge origination fees over 10 percent of the amount you borrow, and the cost is typically deducted from your loan funds. Padding your loan amount before you apply may help you avoid reapplying for more to cover the costs later.
Once you’ve zeroed in on your loan amount, run some numbers using a personal loan calculator. Experiment with longer terms if you want to keep your payment lower or shorter terms if you want to pay the balance off quickly.
“I wanted a slightly longer loan term, so I looked for a loan that would last for seven years. This made the monthly payment a bit lower than a five-year loan, and since I’m planning to pay it off early, the hypothetical additional interest from 24 extra months of interest charged didn’t bother me.” — Jared Wilder, Bankrate analystNext steps
Check the websites of some personal loan lenders to get an idea of the rates and terms they offer. You should also check their rates and use them with a personal loan calculator to get the most accurate idea of what your monthly payment will be.
Once you decide on the amount you want to borrow, you need to know what it will take to get approved by a personal loan lender. Each lender may set different approval requirements and collect a variety of documents to decide whether to take a risk on you as a borrower.
Your credit score, income and debt are usually evaluated by personal loan lenders to see if you qualify. Some lenders may also consider your work history or education.
Researching lender requirements ahead of time will help you choose loans you have the best chance of getting approved for.
You’ll need to provide documentation as part of the personal loan approval process to verify the information you provided on your application. Some lenders may be able to verify this information electronically, but most will ask you to provide:
Most lenders have websites with secure portals you can use to upload requested documents.
Next stepsBe prepared to take pictures or scan your documents and make sure the images are legible. Lenders won’t accept documents they can’t read.
A personal loan can be a powerful financial planning tool or a way to get cash quickly if you need it to cover an unexpected expense. Before you start researching personal loan types, think about how you can use the funds to improve your financial situation.
One major benefit of personal loans is they can be funded quickly — sometimes as soon as one business day. If you’re facing a large unexpected expense like a car repair or an air conditioner replacement in your home, personal loans can get you needed funds fast.
On the other hand, maybe you’re planning to buy a house in the future and want to simplify your expenses and improve your credit score. You could use a personal loan for debt consolidation to replace variable-rate credit cards with a fixed rate and payment. The future perk is your credit score could improve, allowing you to get a lower mortgage rate when you find your new home.
Most personal loan terms range between one and seven years. A longer term will result in a lower monthly payment. However, lenders typically charge higher rates for longer terms, which leaves you paying more interest in the long run.
Personal loan lenders typically charge lower rates for shorter terms, but the payments are much higher. Make sure your budget can handle the higher payment, and avoid short terms if you earn income from commissions or self-employment.
One of the best ways to improve your credit score is to pay off revolving debt like credit cards. If you don’t have the cash to pay them off, a personal loan is a great alternative to convert multiple credit card debts into one installment loan.
Funds from a personal loan are received all at once, and your monthly payment is the same for the term of the loan. That may be a shock if you’re used to making minimum payments on a credit card.
Also, if you don’t need the funds right away, a personal loan might not be the best fit because it locks you into a monthly payment whether you need the funds now or not. For example, if you’re planning some home improvement projects but plan to spread them out over the next year or two, a home equity line of credit (HELOC) allows you to use as much as you need for each project and the payment is only based on the credit balance you access.
If your credit score is low because you have a lot of maxed-out credit cards, a personal loan for bad credit could help you pay those debts off and reduce your credit utilization ratio. Your scores could improve to the point where you can refinance to a better rate later, which will help reduce your overall monthly payments.
Next stepsDouble-check your budget to make sure you can afford a fixed payment, and avoid short-term loans if your income varies.
Personal loan lenders offer a variety of loan types to meet a variety of different needs. While some lenders are flexible in how you use the funds, others may only allow the money to be used for specific purposes. Before applying, check to make sure you can use the funds for what you need.
Likewise, depending on the type of loan you get, you may get different terms and interest rates. For instance, home improvement loans tend to come with longer repayment terms than emergency loans, and debt consolidation loans tend to have lower starting APRs than general purpose loans.
To make the most informed decision on what’s best for your finances, consider every type of personal loan available.
Search the Bankrate personal loan marketplace to find the most competitive loan that best meets your borrowing needs.
Shop around and only apply with lenders that clearly list personal and financial approval requirements that meet your needs. Compare several lenders and loan types to get an idea of what you qualify for. Avoid settling for the first offer you receive.
If you’ve been a longtime account holder with your bank or credit union, see if it’s willing to give you a better rate or offer you any perks or discounts.
Shop around and only apply with lenders that clearly list personal and financial approval requirements that meet your needs. Most personal loan lenders allow you to check your predicted interest rates and eligibility odds before officially applying through a process called “prequalification.”
This process doesn’t require a hard credit inquiry, which limits the overall negative impact to your credit. If you can’t prequalify and the minimum eligibility criteria aren’t listed on the website, you may want to try to contact the lender directly to get the information before applying to avoid damaging your credit with multiple hard inquiries.
Compare several lenders and loan types to get an idea of what you qualify for. Avoid settling for the first offer you receive. If you’ve been a longtime account holder with your bank or credit union, see if it’s willing to give you a better rate or offer you any perks or discounts.
Next stepsReview the rates and terms you’re offered and check the fine print for any limitations on how you can use the money. Watch for prepayment penalties and fees to pick the best option for you.
Once you’ve picked the lender with the best offer for your needs, you’ll start the application process.
You may be able to do the entire application process online. Alternatively, you may have to apply in person at your local bank or credit union branch. You’ll typically need to provide basic personal information and your income and employment information.
Most lenders require that you state your intended loan purpose during the application process as well. Keep in mind the terms of your offer could change depending on the documents you provide. Ask the lender to explain any changes to your interest rate or loan amount after your initial application.
How Jared decided on his debt consolidation lenderUltimately, Jared chose a lender because it was a good fit for his financial profile and allowed him to pay off his credit card debt balances directly with the loan funds. “Their credit score requirement was slightly lower than most, and with my subpar credit score, that made a big difference,” he adds.
Every lender will have different paperwork requirements and once you submit your application, you may be asked to provide additional documentation. Be prepared to provide additional documents alongside the ones you prepared so the lender can verify information you provided on your application. Doing so can help avoid delays.
Next stepsWatch for changes to your terms that are a direct result of the documents you provided. Ask your lender to explain any differences in your rate, loan term or loan amount if they change after your prequalification offer.
After the lender reviews your documents and notifies you that you’ve been approved, you’ll then finalize your loan documents by accepting the terms. Once you sign off on the loan agreement, you’ll typically get your funds within a week, although some online lenders get it to you within one or two business days.
Keep track of when your payments are due, and consider setting up automatic payments to streamline the process. Some lenders even offer interest rate discounts if you use autopay.
Also, consider paying extra each month, even if it’s only a small amount. While personal loans are often cheaper than credit cards, you’ll still save money on interest by paying the loan off early.
Next stepsAlways make your monthly payments on time and try to make extra payments whenever possible. To make the process easier, enroll in automatic payments or set a due date reminder on your calendar.
Getting approved for a personal loan is a simple process. You can increase your chances of approval by taking some steps ahead of time. Simple steps like knowing your credit score and understanding lender requirements could make the difference between a green light for financing or a loan denial. Take the time to research and compare lenders to find the best rates and terms for your specific financial situation.
Wilder suggests understanding the fine print before you sign to avoid getting a loan that’s not a good fit. “You really should read up before you apply so you don’t get stuck in a situation that doesn’t actually fit your needs.”
Denny Ceizyk joined the Bankrate Loans team as a Senior Writer in 2023, providing 30 years of insight from his experience in loan sales and as a personal finance writer to help consumers navigate the lending landscape on their financial journeys.
