Summary of Online Loans: Compare Your Options and Apply Today
|Lender||Est. APR||Min. Credit Score||Learn More|
4.99 - 16.79%
5.99 - 18.64%
Marcus by Goldman Sachs
6.99 - 28.99%
5.99 - 24.99%
9.95 - 35.99%
18.00 - 35.99%
7.99 - 35.97%
6.18 - 35.99%
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Our picks for
Online loans for good credit
Our picks for
Online loans for debt consolidation
These lenders offer loans that help borrowers stay disciplined and pay off debt.
Our picks for
Online loans for bad credit
These lenders are available for borrowers with bad credit, offering flexibility and fast funding.
Our picks for
Online loans for fair credit
These lenders offer loans to borrowers with at least a 620 credit score.
The pros and cons of online personal loans
Lending experiences vary by lender and loan, but you’ll generally encounter these pros and cons with online loans:
- Convenience: With online loans, you can complete the entire loan process — from pre-qualification to signing — from your computer or, in many cases, your phone. Some banks offer an online loan option, but you must visit a branch to complete the application.
- No-risk estimates: Most online lenders allow you to pre-qualify and see estimated rates without committing to a loan or affecting your credit score. Banks and credit unions typically require a hard check for this preliminary step. (All lenders, whether online or brick-and-mortar, typically require a hard credit check before you finalize a loan.)
- Credit plus more: Online lenders look at more than your credit score and credit report when making an approval decision — they may consider your education or occupation, or ask to scan your bank account transactions to assess your financial behavior. This can improve your chances of getting a loan if you’re new to credit or have a low score.
- Quick, simple shopping: It’s easy to compare rates from multiple lenders: Online pre-qualification takes a few minutes, and comparison sites allow borrowers to see loan offers from multiple lenders after filling out a single application form. You can do this on NerdWallet’s lender marketplace.
- Debt help: Some online lenders allow borrowers who take a loan to consolidate debt the option to send money directly to creditors, improving the chances of successfully paying off debt.
- Costlier than credit unions: On average, loans from online lenders are not as cheap as those from credit unions. Since each online lender uses its own underwriting formula, you may get different rates from each one. It’s essential to compare rates from multiple lenders before you take an online loan.
- Sometimes not so simple: The application process for some types of personal loans — including secured and co-sign loans — can be more complex than that for unsecured personal loans, where approval is based largely on income and credit history.
- Large loans only: Loans under $500 may be hard to find at rates below 36%. Most online lenders have loan minimums of $2,000. A local credit union, while not as immediate, is usually the best place to look for small loans.
- Predators lurk: Reputable online lenders compete alongside predatory online lenders. Reputable lenders check your credit and ability to repay the loan, with annual percentage rates that top out at 36%. Predatory lenders advertise that they don’t look at credit. You pay the cost of this added risk, in the form of APRs that can top 400%.
Online personal loans vs. payday loans
Payday loans are quick ways to get a small amount of cash — usually less than $1,000 — and you don't need good credit to get one. But payday loans are expensive, and the companies that offer them usually prioritize their own profits over consumers’ interests, charging triple-digit interest rates and fees for late payments.
Many payday loans have repayment periods of two weeks to a month. If you fail to pay the loan back on time, the lender may withdraw money directly from your account, potentially incurring overdraft charges on top of the lender's late fee.
If you’re looking for a small loan, online personal loans are less expensive, even if your credit is bad. Many can fund a loan for as little as $1,000 on the same business day that you apply for it.
How much will an online loan cost?
As with most credit products, the rate you receive on an online loan depends a lot on your credit score. The better your score, the lower your rate and the less interest you’ll pay over the life of the loan. The interest rate also affects your total monthly payment, as does the term length; a longer term means lower monthly payments, but more interest.
Use our personal loan calculator to estimate your monthly payments based on your credit score.
How to shop for a loan online
Here are a few questions to ask as you search for online loans:
How's your credit? Many online lenders consider additional factors, such as your education history or profession, but in conjunction with your credit score and credit history. If your score is average or poor, it's worth taking steps to build your credit.
Is the APR below 36%? The sum of the interest rate and all fees is known as the annual percentage rate, and the APR you receive largely depends on your credit. Financial experts and consumer advocates agree that 36% APR is the acceptable limit for a loan to be affordable to a borrower. If an online lender offers rates above 36%, that’s a sign the loan is unaffordable, even if the monthly payment fits your budget.
Is your documentation ready? You can easily get rate quotes by providing your name, date of birth, the last four digits of your Social Security number and other information you enter from memory, but once you decide to move forward with an application, lenders will require documentation, including a form of identification and proof of income, such as a pay stub or W-2. You’ll upload the documentation electronically; many lenders accept screenshots or phone photos in addition to scanned documents or PDFs.
Next step: Pre-qualify on NerdWallet
Pre-qualifying with multiple lenders allows you to compare rates, terms and loan features, and choose the online loan that best fits your budget and financial goals. You can pre-qualify on NerdWallet with lenders that partner with us. Doing so won't affect your credit score.
Last updated on March 16, 2020
To recap our selections...
NerdWallet's Online Loans: Compare Your Options and Apply Today
- LightStream: Best for Online loans for good credit
- SoFi: Best for Online loans for good credit
- Marcus by Goldman Sachs: Best for Online loans for debt consolidation
- Payoff: Best for Online loans for debt consolidation
- Avant: Best for Online loans for bad credit
- OneMain Financial : Best for Online loans for bad credit
- Upgrade: Best for Online loans for fair credit
- Upstart: Best for Online loans for fair credit
Frequently asked questions
The best online loan helps you reach a financial goal, such as consolidating existing debt or covering expenses, without creating unmanageable debt. Interest rates are typically based on your income and credit, so the best online loan for a borrower with poor credit might not be the best loan for a good-credit borrower.
Some lenders do offer no-credit-check loans, which sound like a good idea if you have a low credit score or no credit history. If you take out a no-credit-check loan, though, you may end up paying back much more in interest than the original loan amount. Credit unions and some online lenders offer loans to borrowers with low credit scores.
Reputable online lenders take precautions to ensure that your information is secure. Lenders are required by law to tell you how they collect and share your information, as well as how they keep it private. Many have privacy policies on their website, or a number you can call to learn more.