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Discover Personal Loans: 2018 Review

Loans, Personal Loans, Personal Loans Reviews
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5.0 stars out of 5

NerdWallet rating: 5.0 / 5.0
Good for: Good credit, debt consolidation

Discover lends to good-credit borrowers who want to consolidate debt.

discover loans

The online financial company is a good fit for those who:

  • Have good credit scores. The lender’s minimum requirement is 660, but its borrowers’ average is 747.
  • Need discipline paying off debt. Discover can pay off your creditors directly; not all lenders offer that. You have to provide details about your creditors once you’re approved and use at least 70% of your loan toward paying off debt.
  • Want to track their credit score. The lender gives everyone free access to their FICO credit score, and personal loan borrowers can track their credit scores and see a snapshot of their credit history online.

Discover at a glance

Typical APR6.99% to 24.99%
Loan amount$2,500 to $35,000
Time to fundingNext day, up to a week
Origination feeNone
Soft credit check with application?Yes

Click “Compare Rates” to see estimated rates from multiple lenders on NerdWallet.

Discover personal loan review

To review Discover, NerdWallet collected more than 30 data points from the lender, interviewed company executives, completed the online loan application process with sample data, and compared the lender with others that seek the same customer or offer a similar personal loan product. Loan terms and fees may vary by state.

Americans who are struggling to pay down debt are the core of Discover’s personal loans business, says Dan Matysik, vice president of the company’s personal loans division.

While Discover loans can be used for other purposes, such as paying for a vacation or financing a big purchase, the company provides free tools to manage debt and estimate monthly payments on its personal loans website.

The minimum household income requirement is $25,000, but borrowers usually make more, Matysik says.

Discover is among a small number of online lenders that don’t charge an origination fee. The company also allows payment flexibility:

  • Borrowers can change their payment due date twice during the lifetime of the loan, with a minimum of one year between changes
  • A late fee is charged for missed or delayed payments, but those who have trouble making payments can call the company to discuss options like deferred payments or payment plans
  • Borrowers who pay back the loan amount within 30 days don’t pay interest

How Discover loans compare

Freedom Plus and Wells Fargo also offer good-credit borrowers the option to pay off creditors directly. Wells Fargo and Payoff, another good-credit lender, give borrowers free access to their credit scores.

All online lenders accept electronic payments, and many charge a fee for paying any other way. Discover lets borrowers pay over the phone, by personal check or by other means at no extra charge, in addition to automatic electronic payments. See how Discover stacks up in the table below:

LenderOrigination feeFree credit scoresDirect payment to creditorsJoint applicationsOnline-only application
5.0 stars out of 5
4.5 stars out of 5
0.00% - 5.00%NoYesYesYes
4.5 stars out of 5
Wells Fargo
3.5 stars out of 5
*For select credit card holders **For existing customers

How to apply for a Discover loan

You can fill out an application on Discover’s website or over the phone. Discover conducts a soft credit check to see if you qualify for a loan and serve up loan offers. Once you proceed with your application, you will be subject to a hard credit check. It reports payments to all three credit bureaus.

NerdWallet recommends comparing loans to find the best rate for you. Click the button below to see estimated rates from multiple lenders on NerdWallet.


More about Discover

Discover loan requirements

  • Minimum credit score required: 660, but borrowers’ average score is 747
  • Minimum gross income required: $25,000, but typically much higher
  • Minimum credit history: Not provided
  • Maximum debt-to-income ratio: Not provided

Discover lending terms

  • APR: 6.99% – 24.99%
  • Loan amount: $2,500 – $35,000
  • Loan duration: Three to seven years
  • Time to receive funds: Next day, up to a week

Discover fees and penalties

  • Origination fee: None
  • Prepayment fee: None
  • Late fee: $39
  • Personal-check processing fee: None
  • Returned payment fee: None
Before you shop for a personal loan

Updated Jan. 2, 2018.

Personal Loans Ratings Methodology

NerdWallet’s ratings for personal loans awards points to lenders that offer consumer-friendly features, including: soft credit checks, no origination fees, payment options, short time to funding, interest rate caps of 36%, and absence of prepayment penalties. Features are considered for their positive impact on consumers’ credit history and financial health. We only review lenders that cap interest rates at 36%, the maximum rate financial experts and consumer advocates agree is the acceptable limit for a loan to be affordable. NerdWallet does not receive compensation of any sort for our reviews. Read our editorial guidelines.

5 stars out of 5— Among the very best for consumer-friendly features

4.5 stars out of 5— Excellent; offers most consumer-friendly features

4 stars out of 5— Very good; offers many consumer-friendly features

3.5 stars out of 5— Good; may not offer something important to you

3 stars out of 5— Fair; missing important consumer-friendly features

2.5 stars out of 5— Poor; proceed with great caution

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