• Best personal loan for debt consolidation: Citi® Personal Loan. With the highest interest rate coming in under 20%, it represents a good way to get rid of high-interest debt.
• Best personal loan for emergency situations: Upstart. Very few lenders offer loans as small as $1,000.

Citi Personal Loan Review

• Credit score of 750 or more
• Minimum annual income of $30,000
• Age 18 or older (21 or older in Puerto Rico)
• Social Security number
• Verifiable bank account
• U.S. citizen or permanent resident

SoFi Loan Review

• Have a credit score of at least 680
• Be 18 years of age or older
• Be employed or provide evidence of imminent employment
• If not employed, have a reliable source of income
• Be a U.S. citizen, permanent resident, or non-permanent resident

Upstart Personal Loan Review

• Be 18 years of age or older
• Have a valid Social Security number
• Have an active bank account
• Have an annual income of at least $12,000
• Be a U.S. citizen or permanent resident
• Not be a resident of Iowa or West Virginia

Lightstream Loan Review

LightStream personal loans are available from $5,000 - $100,000, with no origination fees or prepayment penalties. Applicants need a score of Good credit or greater, but LightStream does allow co-applicants. Loan terms range from 24-144 months (varies by loan purpose). If an applicant has been approved for a personal loan with the same terms by another lender, LightStream will beat that lender's rate by 0.1%.

• Have a valid Social Security number
• Have a clear plan for what you want to do with the borrowed funds
• Be able to provide evidence of any available assets

Happy Money Loan Review

• Be 18 years of age or older
• Have a valid Social Security number
• Have an active checking account
• Not live in Massachusetts or Nevada
• Have a credit score of 640 or higher
• Have no current account delinquencies

Avant Lending Review

• Have a monthly income of at least $1,200 (can include alimony, child support, or other maintenance)
• Have a credit history that includes at least one account
• Be able to apply on their own (no joint applications or co-signers are accepted)
• Live in any state except for Hawaii, Iowa, Maine, New York, Vermont, or West Virginia

Achieve Personal Loan Review

• Must be 18 years of age or older in most states; must be at least 19 in Alabama or Nebraska
• Must be a U.S. citizen or permanent resident
• Must have a Social Security number
• Must provide proof of income
• Must have a verified bank account

Best Egg Loan Review

Best Egg borrowers can apply for $2,000 to $50,000. However, the loan will not be cheap. In addition, the only applicants offered the lowest rate must have a FICO® Score of at least 700 and earn a minimum of $100,000 annually. The high end of the rate will be prohibitively expensive for many borrowers. Best Egg also charges an origination fee of 0.99% - 8.99%, another factor that can make its loans expensive. Loan terms range from 36 - 60 months.

• Must have a minimum credit score of 550
• Proof of income is required
• Must have a U.S. address
• Must have a valid Social Security number
• Debt-to-income (DTI) ratio (including mortgage) must be 65% or less
• Must live in any U.S. state except: Iowa, Vermont, West Virginia, or U.S. territories

Discover Personal Loan Review

• Minimum credit score of 660 is required
• Applicant must earn at least $25,000 annually
• Must be 18 years of age or older
• Must be a U.S. citizen or permanent resident

What to look for with the best personal loans

The lower the interest rate, the more money you save in paying back the loan. A great loan is one carrying a low interest rate. The interest on a loan is calculated as a percent of the total you borrow.

Look for your personal loan term sweet spot, the shortest term with the most affordable payment. The best loans fit your budget and timeline. The "loan term" is the period of time you have to repay a loan in full. Some people opt for a longer loan term because it keeps their monthly payments low. However, the longer you carry a loan, the more interest you pay in total.

The best personal loan lenders don't charge an origination fee. Other expenses -- like prepayment and late fees -- are kept to a minimum. Another key trait of a great personal loan is that it has no fees or very low fees. Fees can be sneaky. Say a lender offers you a low interest personal loan, but piles on fees. That loan may end up costing more than a loan with a slightly higher interest rate but no fees.

How to get the best personal loan rates

1. Maintain a high credit score. A FICO® Score of at least 720 is normally enough to qualify for the lowest personal loan interest rates.
2. Get a cosigner. If your credit score is not high enough to qualify for a good interest rate, a personal loan cosigner with an excellent credit score can help you get a better interest rate.
3. Shop around for the best rate. Consider looking at traditional banks, credit unions, or even online personal loans. Do your research to find a lender that is offering the best personal loan rates. Many have an online prequalification tool that will give you a rate without hurting your credit score. In some cases, lenders will offer promotions and limited-time discounts.

When is a personal loan the best option?

Do interest rates matter?

Let's compare personal loan rates. Say you need to borrow $20,000 to replace the roof of your house, and you plan to get a loan with a five-year term. You're considering two options: Lender A and Lender B. Below, we've summarized these two imaginary lenders and how their interest rates would impact the cost of your loan.

Even a small percentage change can result in significant savings. It's clear that the lender offering the lower interest rate can save you money over the life of the loan. These are funds you can use in some other way, like investing for your future.

You may only pay an extra $13 per month for a loan from Lender B, but that small difference costs you $780 more over the life of the loan. For help finding low interest personal loans, check out our guide to good interest rates for personal loans.

What if I have bad credit?

You will likely pay a higher interest rate for a personal loan. If this is your situation, you have two options: You can take steps to raise your score and wait until it's in better shape before applying for a loan. The second option is to get a loan now, then refinance your personal loan later (when your credit score is higher and you can get a better rate).

What should personal loans be used for?

• Debt consolidation: Credit cards generally have higher interest rates. A personal loan can be used to consolidate your higher-interest debt to a lower-interest loan.
• Home renovations: Certain home renovations can increase the value of your home. If you have equity in your home, a home equity line of credit (HELOC) may be a better financing option.
• Career advancement: Paying for professional certifications, education, and training can boost your career prospects and opportunities for promotion or a higher-paying job.
• Unexpected expenses: People should have an emergency savings account that has three to six months of expenses. If you don't, a personal loan can help cover a family emergency or help you recover from unexpected and expensive inconveniences.

What should personal loans not be used for?

• Extravagant vacations: A short-term trip can lead to long-term consequences. A personal loan should not be used to fund an elaborate vacation if the loan can't be paid back.
• Celebrations (weddings/birthdays/graduations): If you can't afford to pay the loan back, you shouldn't get a personal loan for events that only last a day. Celebrations generally are planned in advance, so it is better to save up for it.
• Extra spending money: Taking out a personal loan to raise your standard of living is not a good idea. You should avoid a lifestyle your current finances can't support.

How to get a personal loan

Gather documents

• Proof of identification
• Proof of address
• List of monthly expenses
• Evidence of how much your collateral is worth (if you're applying for a secured personal loan)

Shop lenders

Take the time to shop for the best lender. Lenders make loan decisions based on a "soft" credit check, which has no impact on your credit score. This soft credit check gives the personal loan lender a sense of your credit history, including credit card debt and other debt (like an outstanding installment loan). If your credit score is not quite perfect, look for lenders that specialize in personal loans for fair credit or personal loans for bad credit.

Compare loan offers

• The lowest annual percentage rate
• A repayment term that fits your budget
• Loan amounts that match your borrowing needs
• Lowest loan fees (ideally, you'll find a loan with no origination fee or prepayment penalty)
• Perks like loan deferment when you're unemployed

Commit to a lender

A hard credit check is a deeper dive into your credit history, and it helps the personal loan provider make sure a borrower meets its minimum credit score requirement and has paid bills on time. Although the hard credit check may decrease your credit score, it's typically by less than five points. After a few months of regular payments, your score should rebound to its pre-loan level.

Note: If a low credit score means you don't receive a loan offer that works for you, consider taking time to improve your credit score. Boosting your score can only help you in the long run. Small changes like reducing your credit utilization, paying bills on time, and only applying for credit when needed can help raise your FICO® Score.

Sign loan documents

Whether you're working with an online lender or a brick-and-mortar financial institution, most lenders allow you to sign documents electronically. Read through the documents thoroughly before signing. Once you've signed, you're legally committed to whatever is written inside the four corners of the contract.

Wait for loan funding

What happens if your personal loan application is not approved?

What are the alternatives to personal loans?

Credit cards

A credit card can provide fast cash in an urgent situation. If you qualify for a 0% APR credit card, you have time (typically 12 to 18 months) to pay off the debt with no interest.

Secured line of credit

A secured line of credit can help you snag the best rates for personal loans. When you take out a secured line of credit or secured personal loan, you typically pay a lower interest rate because you put up something of value as collateral. This may be anything of value, such as a car, home, boat, or jewelry.

How to pay off your personal loan

Since personal loans typically have higher interest rates, you want to pay them off as fast as you can. You will pay less interest and have more peace of mind if you don't have potentially tens of thousands of dollars to pay back. Here are some simple tips to help you pay back your personal loan faster without breaking the bank. Make sure you check with your lender to see if there are any penalties for paying off your personal loan early.

1. Make bi-weekly payments. Most loans require you to make monthly payments. Instead, make a half-payment every two weeks. By doing this, your payments will be applied to the principal more often, so you end up paying less interest over time. Also, by making payments on your personal loan every two weeks, you will be making 26 total payments per year. This translates to one whole extra payment a year. This can shorten your loan payoff by months and in some cases years.
   
2. Make an extra payment. If your lender will not allow you to split your loan payments, make an extra payment every year. Use a bonus, tax refund, or additional income for the extra payment. If the amount is too much to pay it at once, divide it by 12 and add it to your monthly payment to spread it out over time. The more money you are able to pay toward the loan, the faster you can pay it off. Consider getting a side hustle, selling things you don't need, or cutting your expenses to put extra money toward the loan.
   
3. Round up your monthly payment. Round up your loan to the nearest $50 dollars. For example, if your loan payment is $230, round up to $250. For an even bigger impact, you could round up to the nearest $100. In this case, it would be $300. The extra amount may be small enough to not impact your budget, but it would help you pay down your personal loan sooner.
   
4. Refinance your loan. If you have a high interest rate on your loan, look to refinance to get a better rate. Your credit score may have improved since you got the loan. Shop around to find the best rates.

Other personal loans to compare

• LendingPoint: Good for people with low credit scores
• Upgrade: Good for debt consolidation and people with fair credit
• Wells Fargo Personal Loans: Good for low APRs for Wells Fargo customers