How Many Personal Loans Can You Have at Once?

Borrowers can have more than one personal loan, but how many loans and how much you can borrow depends on a lender’s requirements. Some lenders will approve a second or third loan, but others limit you to one personal loan at a time

Managing multiple personal loans can also strain your budget, so it’s worth considering alternatives before turning to another loan.

» MORE: Check personal loans interest rates

How many personal loans can I have?

There are no federal regulations prohibiting someone from having multiple personal loans, says Carolyn Carter, deputy director of the nonprofit National Consumer Law Center. You can have more than one personal loan with some lenders or multiple personal loans across different lenders.

Some lenders have a maximum number of loans you can have with them, a maximum amount you can borrow or both. Lenders don't typically decline applicants solely because of an existing loan, but they may reject your application if you have too much debt.

Qualifying for a second personal loan

Getting approved for a second personal loan could be challenging. But if you have one loan in good standing and don't have a lot of other debts, you may be approved for another loan.

Here are some factors lenders consider:

• Debt-to-income ratio: When they review your loan application, most lenders consider your debt-to-income ratio (DTI), which is your monthly debt payments divided by your gross monthly income. Lenders usually look for that number to be about 40% or lower.

• Loan amount: Some lenders allow you to have more than one loan, but they may cap the total amount you can borrow.

• Creditworthiness: Many lenders have minimum credit score requirements to qualify for a loan. You’re more likely to qualify for a loan with a low interest rate if you have a credit score of 690 or higher.

A lender could approve you for a second loan, but you may not get the terms you’d prefer. Some lenders will charge a higher annual percentage rate (APR) because of your existing debt. Or you may not qualify for the full amount you wanted to borrow.

» MORE: What is an annual percentage rate on a personal loan?

Getting multiple loans from the same lender

This table shows the number of personal loans some popular lenders will provide to a single borrower:

Some lenders require that a borrower make a certain number of payments before applying for another loan. SoFi needs three consecutive payments toward an existing loan before a borrower can apply again.

Upstart says borrowers can have one active Upstart loan, but they must wait at least six months before applying for a second loan. Borrowers must not have been disqualified for a loan within the previous 30 days.

» MORE: How to manage your personal loan

How do multiple personal loans affect your credit?

It’s worth considering the hit your credit score could take when you apply for another loan. New personal loan applications, whether approved or not, often trigger a hard credit pull that can temporarily drop your score by a few points.

If you apply for several loans in quick succession, the effect on your credit can multiply, and you could see a big dent in your score.

You could also do serious damage to your score if having multiple loans results in missed monthly payments.

Risks of multiple personal loans

Personal loans can be a long-term financial commitment and work best for large, planned expenses. For example, a debt consolidation or home renovation loan can be financially beneficial, but taking multiple loans can add substantial debt to your budget.

In addition to affecting your credit, consider these risks of a second or third personal loan:

• Temptation to take on more debt. Getting another personal loan could lead you to overspend or rely on debt for everyday expenses. If you take out a debt consolidation loan to pay off your credit card balances but charge up your cards again, you’ll wind up deeper in debt.

• Potential strain on your budget. Juggling multiple loan payments can be difficult, particularly on a tight budget. Consider whether you could still afford to pay for essentials and pay down your other debts as agreed before you take on an additional loan payment.

• Higher debt-to-income ratio. Multiple loans will drive up your debt-to-income ratio. That could make it harder to qualify for credit or financing in the future, since lenders prefer a lower number.

Before you move forward with a new personal loan, calculate your monthly payments and consider how they’ll fit into your budget.

Alternatives to personal loans

If you want to avoid taking another personal loan, here are some alternatives:

Buy now, pay later: "Buy now, pay later" plans let you pay for a purchase over a series of installments, often without interest or fees. Buy now, pay later can be a good option if there is zero interest and you have the cash flow to pay off the loan. But the convenience of buy now, pay later can lead to overspending.

0% interest credit card: If you have a good credit score (typically 690 or higher), you may qualify for a 0% APR credit card that could allow you to finance a large expense or transfer an existing credit card balance interest-free for an introductory period of 18 to 21 months. Make sure to pay off the expense before the interest-free period ends to avoid paying interest on your balance.

Loan apps: Cash advance apps can cover a short-term cash need by providing a small advance on your paycheck. Instead of interest, cash advance apps may charge a subscription fee or an optional tip for the service. Funding can take one to three days, although borrowers can sometimes get instant funding by paying an extra fee.

Medical payment plan: Many doctors, dentists and veterinarians allow patients to work out a payment plan. Some medical providers also make medical credit cards available to help patients with costly procedures.

Home equity line of credit: Homeowners can consider a HELOC to fund a large expense, like a home renovation. A HELOC is a credit line that you draw on as needed and pay interest only on what you borrow for a set amount of time, after which you pay the principal during the repayment period. The long draw period — typically 10 years and then 20 years for repayment — makes HELOCs better for expenses that may have unexpected costs.

» MORE: NerdWallet’s best HELOC lenders