How we chose the best personal loans
Our team of consumer lending experts follows an objective and robust methodology to rate lenders and pick the best.
35+
Lenders reviewed
We review over 35 lenders, including major banks, top credit unions, leading digital platforms, and high interest installment lenders operating across multiple states.
25+
Categories assessed
Each lender is evaluated across five weighted categories and 27 subcategories, covering affordability, eligibility, consumer experience, flexibility, and application process.
70+
Data points analyzed
Our team tracks and reassesses hundreds of data points annually, including APR ranges, fees, credit requirements, and borrower tools, ensuring up to date, accurate comparisons.
Star rating categories
We evaluate more categories than competitors and carefully weigh how each factor impacts your experience.
We review lenders’ annual percentage rate offerings at least twice per year and the competitiveness of each lenders’ APR range. We also assess whether a lender charges an origination fee and any opportunity for borrowers to receive a rate discount.
We consider the experience of the consumer trying to manage a personal loan, which means accessibility of customer service representatives, whether borrowers can choose and change their payment due date, and the ability to track their loan on a mobile app.
Underwriting and eligibility
We consider the rigorousness of each lender’s underwriting practices and how widely available their loans are. This category includes whether a lender does a hard credit check before providing a loan, the range of credit profiles they accept and how many states their loans are offered in.
We assess how flexible lenders can be with borrowers, including whether they offer multiple loan types, personal loan amounts and repayment term options and whether they offer direct payment to creditors on debt consolidation loans.
We consider the lender’s full application process, including a borrower’s ability to preview their loan offer via pre-qualification, whether basic loan information such as APR range and repayment terms are available and easy to find online and how quickly a loan can be funded after approval.
NerdWallet’s review process evaluates and rates personal loan products from more than 35 financial technology companies and financial institutions. We collect over 70 data points and cross-check company websites, earnings reports and other public documents to confirm product details. We may also go through a lender’s pre-qualification flow and follow up with company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
Our star ratings award points to lenders that offer consumer-friendly features, including: soft credit checks to pre-qualify, competitive interest rates and no fees, transparency of rates and terms, flexible payment options, fast funding times, accessible customer service, reporting of payments to credit bureaus and financial education. Our ratings award fewer points to lenders with practices that may make a loan difficult to repay on time, such as charging high annual percentage rates (above 36%), underwriting that does not adequately assess consumers’ ability to repay and lack of credit-building help. We also consider regulatory actions filed by agencies like the Consumer Financial Protection Bureau. We weigh these factors based on our assessment of which are the most important to consumers and how meaningfully they impact consumers’ experiences.
What is an auto repair loan?
Auto repair loans are personal loans that are used to pay costly auto repair bills. Personal loan amounts are typically $1,000 to $50,000, though some lenders offer smaller or larger loans. Annual percentage rates, which represent the full cost of borrowing, are fixed and usually range from 6 to 36%. Since you can use a personal loan for almost any expense, you can use one to pay an auto repair bill if you don’t have the money on hand. Most personal loans are unsecured, meaning they don’t require collateral, and lenders qualify borrowers based on their credit, income and existing debts. Borrowers with good to excellent credit (a score in the mid-600s or higher) have the best chances of qualifying and getting a low APR.
Most auto insurance policies don't cover routine repairs or maintenance, but if your vehicle was damaged due to an accident or weather event, your insurance may cover those repairs. Check your policy or vehicle warranty plan before you borrow. How long does it take to get an auto repair loan?
You can get a personal loan for an auto repair from a bank, credit union or online lender, but online lenders tend to be the fastest.
Here’s a breakdown of approval and funding time for our top picks for auto repair loans:
Lender | Approval time | Funding time |
|---|
| Instant. | Same-day, for borrowers who sign their loan documents before 1 p.m. ET Monday through Friday. |
| Instant. | One business day. |
| Instant. | One business day. |
| Instant. | One business day. |
| Within two hours, on average. | One business day. |
| One to a few days. | One day. |
| One to a few days. | One business day. |
To speed up the process, make sure you supply all required documentation in your loan application, including proof of employment and income, like a paystub or tax return.
How to get an auto repair loan
Follow these steps to get a loan to cover auto repair costs.
Determine how much you’ll need to borrow. You’ll need a solid cost estimate to know what size loan to ask for. Get multiple quotes to find the best deal, but keep in mind that some mechanics charge a diagnostic fee to determine the scope of the work. Consider factors like the time it’ll take to complete the repairs, the reputation of the repair shop and the distance if you need to tow the vehicle to a shop.
Pre-qualify with multiple lenders. Once you know how much you need to borrow, pre-qualify for a personal loan to preview the rate, monthly payment amount and loan term. It is free and typically involves a soft credit pull, which doesn’t affect your credit score. Pre-qualify with multiple lenders and compare loan offers with other financing options to find the best deal. Complete a formal loan application. Gather documents like your driver’s license, pay stubs and tax returns, because many lenders require proof of identification and income on a loan application. The lender will conduct a hard credit inquiry when you apply for a personal loan, causing a temporary dip in your credit score.
If you’re approved for the loan, the lender will likely disburse funds within a few days. Your first loan payment will be due in about 30 days, and the monthly payment amount will be the same for the loan term.
Consider enrolling in automatic payments or setting calendar reminders to ensure you make payments on time. Missed payments can result in late fees, and most lenders report payments that are more than 30 days late to the credit bureaus.
Alternative financing options
Repair shop financing: The dealership or repair shop may offer in-house financing through a third-party lender. For example, Jiffy Lube and Midas both offer credit cards. These financing options may include a low- or no-interest introductory period, but be sure to check the regular interest rate and terms. If you can’t pay the repair off during the promotional period, you may be charged interest retroactively.
Buy now, pay later: “Buy now, pay later” companies, such as Affirm, Afterpay and Klarna, offer payment plans that can help break up an auto repair or car-related purchase, like new tires. These plans may be available directly at the repair shop or dealer, or you can download a BNPL mobile app and search for the store or repair shop in the app’s directory. The most popular plan is called a pay-in-four, in which payments are spread out across six weeks for no interest. Zero-interest credit card: Some credit cards have no-interest promotional periods — generally the first 15 or 21 months — for new account holders. Qualifying for a zero-interest credit card usually requires good or excellent credit. These cards generally don’t charge retroactive interest, so if you don’t pay the card off during the promotional period, you’ll begin paying the regular interest rate once it ends. Family loan: Borrowing money from a loved one helps you avoid a formal application process and may be an interest-free financing option. Sign a loan agreement to keep both parties on the same page about how the family loan will be repaid. Financial assistance from a local nonprofit: Some local charities and nonprofit organizations help people in need with bills they can’t afford. Assistance may be based on your household income. A good place to start is 211.org. Avoid predatory car repair loans
Approach payday loans and title loans with caution, because while they provide borrowers with fast, easy money, their high rates and short repayment periods make them difficult to repay. Most personal finance experts consider loans to be affordable if interest rates are 36% or lower. Payday and title lenders often charge triple-digit rates. Those who are unable to repay these loans may need to borrow again, creating a cycle of debt.
