Best Unsecured Personal Loans of December 2023
Unsecured loans don’t require collateral and can be used for just about any purpose. Compare loans from multiple lenders that offer unsecured personal loans.
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An unsecured loan is a loan that doesn’t require you to pledge an asset, such as a house or car, as collateral. Instead, approval is based primarily on your credit score and finances.
Unsecured loans can be used for almost any purpose. If you’re considering an unsecured personal loan, compare potentially cheaper options, and make sure the monthly payments don’t stress your budget.
Why trust NerdWallet? The personal loans editorial team at NerdWallet has objectively reviewed and compared more than 35 technology companies and financial institutions to find the best unsecured personal loans. Our picks feature a variety of loan purposes, loan amounts and credit requirements. See our full methodology at the bottom of this page.
SoFi offers prime borrowers competitive rates, no fees and rate discounts. Its perks include fast funding, a wide range of loan amounts, plus financial advice.
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Best Unsecured Personal Loans
| Learn more | |||||
|---|---|---|---|---|---|
 Upstart Go To Lender Siteon Upstart's website on Upstart's website Check Rateon NerdWallet on NerdWallet | 4.5 /5 | 6.40-35.99% | $1,000-$50,000 | None | Go To Lender Siteon Upstart's website on Upstart's website Check Rateon NerdWallet on NerdWallet |
 Upgrade Go To Lender Siteon Upgrade's website on Upgrade's website Check Rateon NerdWallet on NerdWallet | 5.0 /5 | 8.49-35.99% | $1,000-$50,000 | 560 | Go To Lender Siteon Upgrade's website on Upgrade's website Check Rateon NerdWallet on NerdWallet |
 LightStream Go To Lender Siteon LightStream's website on LightStream's website Check Rateon NerdWallet on NerdWallet | 4.5 /5 | 8.49-25.49% | $5,000-$100,000 | 660 | Go To Lender Siteon LightStream's website on LightStream's website Check Rateon NerdWallet on NerdWallet |
 SoFi Personal Loan Go To Lender Siteon SoFi's website on SoFi's website Check Rateon NerdWallet on NerdWallet | 🏆 Top 3 most visited 5.0 /5Rate discount | 8.99-25.81% | $5,000-$100,000 | None | Go To Lender Siteon SoFi's website on SoFi's website Check Rateon NerdWallet on NerdWallet |
 Best Egg Go To Lender Siteon Best Egg's website on Best Egg's website Check Rateon NerdWallet on NerdWallet | 4.5 /5 | 8.99-35.99% | $2,000-$50,000 | 600 | Go To Lender Siteon Best Egg's website on Best Egg's website Check Rateon NerdWallet on NerdWallet |
 Achieve Personal Loans Go To Lender Siteon Achieve's website on Achieve's website Check Rateon NerdWallet on NerdWallet | 4.5 /5 | 8.99-35.99% | $5,000-$50,000 | 620 | Go To Lender Siteon Achieve's website on Achieve's website Check Rateon NerdWallet on NerdWallet |
 Discover® Personal Loans Go To Lender Siteon Discover's website on Discover's website Check Rateon NerdWallet on NerdWallet | 5.0 /5 | 7.99-24.99% | $2,500-$40,000 | 660 | Go To Lender Siteon Discover's website on Discover's website Check Rateon NerdWallet on NerdWallet |
 Happy Money Go To Lender Siteon Happy Money's website on Happy Money's website Check Rateon NerdWallet on NerdWallet | 4.5 /5 | 11.72-24.67% | $5,000-$40,000 | 640 | Go To Lender Siteon Happy Money's website on Happy Money's website Check Rateon NerdWallet on NerdWallet |
4.5 /5 | 6.99-35.99% | $2,000-$50,000 | 560 | Check Rateon NerdWallet on NerdWallet | |
4.5 /5 | 9.57-35.99% | $1,000-$40,000 | 600 | Check Rateon NerdWallet on NerdWallet | |
4.0 /5 | 8.99-24.25% | $5,000-$45,000 | 660 | Check Rateon NerdWallet on NerdWallet | |
 Universal Credit Go To Lender Siteon Universal Credit's website on Universal Credit's website Check Rateon NerdWallet on NerdWallet | 4.0 /5 | 11.69-35.99% | $1,000-$50,000 | 560 | Go To Lender Siteon Universal Credit's website on Universal Credit's website Check Rateon NerdWallet on NerdWallet |
Our pick for
Home improvement loans
These lenders offer low rates for borrowers looking to make home renovations.
SoFi Personal Loan
8.99-25.81%
$5,000-$100,000
None
Our pick for
Debt consolidation loans
These lenders offer consumer-friendly features for those looking to combine debts.
Achieve Personal Loans
8.99-35.99%
$5,000-$50,000
620
Discover® Personal Loans
7.99-24.99%
$2,500-$40,000
660
Our pick for
Medical loans
An unsecured loan from these lenders can be used for dental, cosmetic and medical procedures.
Our pick for
Wedding loans
An unsecured loan from one of these lenders can help cover the cost of a wedding.
Laurel Road Personal Loan
8.99-24.25%
$5,000-$45,000
660
Our pick for
Bad credit loans
These lenders offer unsecured personal loans to borrowers with low credit scores.
Universal Credit
11.69-35.99%
$1,000-$50,000
560
What is an unsecured personal loan?
An unsecured personal loan is a loan from an online lender, a bank or a credit union that doesn’t require collateral to guarantee the loan. Loan amounts range from $1,000 to $100,000 and are paid back monthly in terms typically ranging from two to seven years.
The best use of an unsecured loan is one that improves your finances. This could mean getting a loan for debt consolidation, which can reduce your debt and help you pay it off faster, or for a home improvement project, which can increase the value of your home.
What is the difference between secured and unsecured loans?
A secured loan requires you to offer collateral as part of the loan agreement. Examples of collateral include your car, your house or a savings or retirement account.
Because secured loans are backed by an asset, borrowers who have lower credit scores may qualify for a better interest rate or higher loan amount compared with an unsecured loan. But there’s a catch — if you fail to repay a secured loan, the lender can seize your collateral.
With an unsecured loan, you don’t risk collateral, but it may be harder to qualify. Lenders look at credit score, credit history, income and existing debt when deciding whether to approve you. If you fail to repay an unsecured loan, your credit will take a hit.
Pros and cons of secured and unsecured loans
Pros | Cons | |
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Secured loans |
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Unsecured loans |
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How do unsecured loans work?
To get an unsecured loan, you’ll need to apply with a bank, a credit union or an online lender that offers personal loans.
If you’re approved, you’ll receive the money in a lump sum in your account. You’ll then repay the loan in monthly installments spread out over a set repayment term.
Monthly payments are typically fixed, meaning they won’t change over the life of the loan.
What is the interest rate on an unsecured personal loan?
The interest rate on an unsecured personal loan typically ranges from 6% to 36%. It’s expressed as an annual percentage rate (APR) and includes interest and any fees associated with the loan.
For example, if you apply for a $7,000 unsecured personal loan at 15% APR and choose a two-year repayment term, you’ll make monthly payments of $339. The loan will cost $1,146 in total interest.
Nerdy Tip
You can use NerdWallet’s personal loan calculator to plug in your potential loan amount, repayment term and APR to see what your monthly personal loan payments would be.
Here’s a look at average personal loan interest rates, based on your credit bracket.
Borrower credit rating | Score range | Estimated APR |
Excellent | 720-850. | 13.32%. |
Good | 690-719. | 15.32%. |
Fair | 630-689. | 18.12%. |
Bad | 300-629. | 20.88%. |
Source: Average rates are based on aggregate, anonymized offer data from users who pre-qualified in NerdWallet’s lender marketplace from Nov. 1, 2023, through Nov. 30, 2023. Rates are estimates only and not specific to any lender. The lowest credit scores — usually below 500 — are unlikely to qualify. Information in this table applies only to lenders with maximum APRs below 36%.
Common uses for unsecured personal loans
Though an unsecured personal loan can be used for almost any purpose, NerdWallet recommends using one when it can improve your finances. Debt consolidation and home improvement are two common examples.
Unsecured personal loans for debt consolidation
Debt consolidation involves combining debt from multiple sources into a single monthly payment, ideally at a lower interest rate. Using an unsecured personal loan to consolidate debts can save money on interest and give you an end date to work toward.
» COMPARE: Best debt consolidation loans
Unsecured personal loans for home improvement
Using an unsecured personal loan for home improvement is an option if you don’t have a lot of equity in your home or want to avoid using your home to secure the loan. By financing important repairs or updates, you can potentially increase the value of your home.
» COMPARE: Best home improvement loans
Other ways to use unsecured personal loans
You can use an unsecured personal loan to pay for medical expenses that aren’t covered by insurance or savings. However, it can be an expensive way to finance health-related costs, and you may have cheaper options, so shop around before you apply.
You can also use an unsecured loan to fund a one-time, big expense like a move, wedding or vacation, though we recommend paying with savings whenever possible to avoid finance charges.
How to get an unsecured personal loan
Lenders may have different qualification requirements, but there are some general factors that help you qualify for low rates.
Good credit: Good- and excellent-credit borrowers (690 credit score or higher) typically get the lowest APR on a personal loan. Some lenders cater to fair- and bad-credit borrowers (689 credit score or lower), but the best terms and rates are reserved for those with high credit scores.
» COMPARE: Best personal loans for bad credit
Low debt-to-income ratio: Many lenders check whether your debt-to-income ratio is low enough to support monthly repayments. Some say borrowers need a 45% DTI or lower to qualify, but others have higher limits.
Stable credit history: Lenders favor borrowers who can show that they’ve consistently made on-time payments across multiple accounts — which can be credit cards, auto loans or other installment loans — over a number of years. Aim for at least two or three years of credit history across two or three accounts.
Steady income: Having a steady income can signal to a lender that you'll have the funds available to repay your loan.
How to apply for an unsecured personal loan
Pre-qualify: Make sure to shop around for the best unsecured personal loan. An easy way to do this is by pre-qualifying with multiple lenders, which allows you to see your potential loan amount and rate without affecting your credit score. Though not all lenders offer pre-qualification, most online lenders do.
Apply: Once you’ve chosen a lender, it’s time to apply for the loan. Many applications are completely online and require you to submit personal details, such as your name, address, contact details and Social Security number.
You’ll also need to submit documentation — usually proof of identity, employment and income.
Get funded: Once you’re approved, funding time can vary by lender. But in some cases, your loan can be funded the same or next business day after you’re approved.
Plan for monthly payments: Your first payment generally comes due 30 days after closing your loan. Take time to adjust your budget to ensure on-time monthly payments. This can help you avoid late fees and hits to your credit.
Unsecured personal loan alternatives
You may want to consider alternatives along with a personal loan, depending on what you're financing.
0% APR credit card: These cards work well if you need to finance a major expense, repay medical bills or consolidate debt. You need good or excellent credit to qualify and debt small enough to be repaid in the card's interest-free promotional period, which can extend up to 21 months.
Home equity loans and HELOCs: These are good options for home renovations if you're comfortable using your home as collateral and have enough equity to qualify. A home equity loan can give you a longer repayment term and typically a lower rate than a personal loan. A home equity line of credit (HELOC) lets you use funds as needed, and you only pay interest on what you use.
Last updated on December 1, 2023
Methodology
NerdWallet’s review process evaluates and rates personal loan products from more than 35 technology companies and financial institutions. We collect over 50 data points from each lender 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.
NerdWallet does not receive compensation for our star ratings. Read more about our ratings methodologies for personal loans and our editorial guidelines.
NerdWallet's Best Unsecured Personal Loans of December 2023
- LightStream: Best for Home improvement loans
- SoFi Personal Loan: Best for Home improvement loans
- Best Egg: Best for Home improvement loans
- Achieve Personal Loans: Best for Debt consolidation loans
- Discover® Personal Loans: Best for Debt consolidation loans
- Happy Money: Best for Debt consolidation loans
- Upstart: Best for Medical loans
- Prosper: Best for Medical loans
- LendingClub: Best for Wedding loans
- Laurel Road Personal Loan: Best for Wedding loans
- Upgrade: Best for Bad credit loans
- Universal Credit: Best for Bad credit loans
Frequently asked questions
- What does it mean when a loan is unsecured?
A loan that's unsecured is one you don't need collateral, like a car or savings account, to secure. Instead, a lender considers your credit score, existing debts, income and other factors about you on a personal loan application.
- How do I qualify for an unsecured personal loan?
Lenders vary in their requirements for borrowers. A good credit score (690 or higher), a low debt-to-income ratio and a credit history of at least a few years will help you qualify in most cases. Some lenders tailor their loans to bad- and fair-credit borrowers, so you may have options even with less-than-desirable credit. You can pre-qualify to see what loan rates and terms you could qualify for.
- Do unsecured loans affect your credit?
If you borrow an unsecured loan, your credit will be affected in two ways. When you formally apply for the loan (which is different from pre-qualifying), the lender will do a hard credit inquiry, which causes a temporary dip in your credit score. The lender will also report your monthly payments to the credit bureaus, which can help you build credit with on-time payments.
- Are unsecured loans safe?
Unsecured loans are safe when they come from reputable lenders. A lender should check your ability to repay the loan, be transparent about the loan's overall cost and help you build credit.
