Discover Personal Loans: 2023 Review
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Our Take
5.0
Discover’s online experience, strong customer support and borrower perks make it a top lender for good- and excellent-credit applicants.
Pros & Cons
Pros
- No origination fee.
- Option to pre-qualify with a soft credit check.
- Fast funding.
- Mobile app to manage loan.
Cons
- May charge late fee.
- No co-sign or joint loan option.
- No rate discount.
Compare to Other Lenders
Full Review of Discover® Personal Loans
Discover offers unsecured personal loans that can be used for almost any purpose for borrowers with good or excellent credit scores.
The lender accepts personal loan applications online or over the phone with a Discover loan specialist. If approved, Discover can deposit the funds in as little as one business day, and borrowers can manage loan payments from a mobile app.
Unlike some competitors, Discover doesn’t offer opportunities for rate discounts; however, the lender has other perks like a wide range of repayment terms and a free monthly credit scorecard.
» MORE: Compare personal loan options
Table of Contents
Discover personal loans at a glance
Minimum credit score | 660. |
APR | 7.99% - 24.99%. |
Fees | Late fee: $39. |
Loan amount | $2,500 to $40,000. |
Repayment terms | 3 to 7 years. |
Time to fund after approval | Next business day. |
Loan availability | Loans available in all 50 states, Puerto Rico and Washington, D.C. |
- Disclosure from Discover
This is not a commitment to lend from Discover Personal Loans. Your approval for a loan is determined once you apply and is based on your application information and credit history. Your APR will be between 7.99%-24.99% based upon creditworthiness at time of application for loan terms of 36-84 months. For example, if you get approved for a $15,000 loan at 12.99% APR for a term of 72 months, you'll pay just $301 per month. Our lowest rates are available to consumers with the best credit. Many factors are used to determine your rate, such as your credit history, application information and the term you select. State Restrictions May Apply. Not all applications will be approved.
Where Discover personal loans stand out
Debt consolidation: Discover is a good option for debt consolidation. Qualified applicants may qualify for a low rate, and if approved, Discover will send loan funds directly to your creditors within one business day. Discover offers an online consolidation calculator that shows potential savings with a Discover personal loan.
» MORE: Best debt consolidation loans
Customer support: Discover has a team of U.S.-based loan specialists available seven days a week during extended business hours to answer questions. Customers can also access the Discover Online Account Center to view their progress on payments and begin the payoff process at any point in the loan term.
Refinancing option: Borrowers can use a Discover loan to refinance an existing personal loan from another lender. If you qualify for a lower rate, you could save money on interest and pay off your debt faster.
» COMPARE: Personal loans for good credit
Where Discover personal loans fall short
No rate discount for autopay: Unlike other lenders, Discover doesn't offer a rate discount for setting up automatic payments. The discount can usually range from 0.25 to 0.5 percentage points and lowers the loan’s annual percentage rate.
Late fee: Discover may charge a $39 late fee for payments not received by the due date. Many lenders offer a grace period for making a payment past its due date.
No co-signer, joint or secured loan options: Discover offers unsecured personal loans only. This means you cannot add a borrower or co-signer or secure a loan with collateral. These options can help borrowers get approved, or receive a lower rate or larger loan amount.
» MORE: Compare co-sign and joint loans
How to qualify for a Discover personal loan
Discover doesn’t disclose many borrower requirements, but according to the lender, it reviews credit history, recent credit activities and credit inquiries when evaluating an application. Here’s what you need to qualify:
Minimum credit score: 660.
Minimum individual or household annual income: $25,000.
Must be at least 18 years old.
Must be a U.S. citizen or permanent resident.
Before you apply
Check your credit. You can get your free credit report on NerdWallet or at AnnualCreditReport.com. Doing so will help you spot and fix any errors before you apply.
Calculate your monthly payments. Use a personal loan calculator to determine what APR and repayment term you’d need to get a loan with affordable monthly payments.
Make a plan to repay the loan. Review your budget to see how the loan’s monthly payments impact your cash flow. If you have to cut other expenses to repay the loan, it’s better to know that before you borrow.
Gather your documents. Discover requires proof of income, which can be a W-2 or pay stub, as well as proof of address and a Social Security number. Having these documents handy can speed up the application process.
How to apply for a Discover personal loan
Here are the steps to apply for a Discover loan.
Decide how much you need. Understand how much you need from a personal loan by looking at your monthly budget and cash flow. This is also a good time to get your documents together to help with verification during the application process.
Pre-qualify with Discover over the phone or online. You’ll be asked how much you want to borrow and what the funds are for, as well as some personal information like your name, birthday and address. You will also be asked about your income, employment and whether you own your home. There’s no hard credit pull at this stage.
Preview loan offers and accept the one that fits your budget. Discover may show up to five loan offers with different rates, terms and monthly payments. Once you find a loan offer that works for you, you’ll submit a formal personal loan application. This could require verification with documents like W-2s, pay stubs and bank statements. Discover will do a hard credit check when you apply, so your credit score could temporarily dip. After applying, a loan specialist from Discover may reach out to you to confirm the information you provided.
Make a plan to repay the loan. Discover reports payments to all three major credit bureaus, so on-time payments will help build your credit score, but missed payments will hurt it. Setting up automatic payments and keeping an eye on your budget are two ways to manage your loan payments.
Compare Discover with other lenders
Personal loan lenders offer different rates, loan amounts and special features, so it pays to weigh other options. The best personal loan is usually the one with the lowest APR.
Discover is one of the best options for borrowers with excellent credit, but SoFi and LendingClub are strong lenders with wider options.
Discover vs. SoFi
Both SoFi and Discover offer borrowers fast funding and the convenience to manage a loan with an app. SoFi loans have an autopay rate discount and no fees. However, SoFi’s starting rates and minimum loan amounts are higher than Discover’s.
» MORE: SoFi personal loan review
Discover vs. LendingClub
LendingClub boasts a wider loan amount range than Discover, but its loan terms can be shorter. LendingClub also accepts lower credit scores. Discover’s APR range is lower, and it doesn’t charge an origination fee.
» MORE: LendingClub personal loan review
How we rate Discover personal loans
NerdWallet writers rate lenders against a rubric that changes each year based on how personal loan products evolve. Here’s what we prioritized this year:
Category | Star rating |
|---|---|
Affordability | |
Transparency | |
Loan flexibility | |
Customer experience | |
Overall |
- Label
Affordability An affordable loan has low rates and fees compared to other similar loans and may offer rate discounts. Transparency A transparent lender makes information about the loan easy to find on its website, including rates, terms and loan amounts. Transparency also means allowing users to pre-qualify online to preview potential loan offers and reporting payment information with the major credit bureaus. Loan flexibility A flexible loan is one that lets users customize terms and payments. That means offering a wide range of repayment term options, allowing the borrower to change their payment date, offering loans in most states and funding it quickly. Customer experience A good customer experience can include a fully online application process, financial education on the lender’s website and a customer service team that’s available most of the time and can be reached multiple ways.
Ready to apply? Use the button below to head to Discover's website to pre-qualify.
Find the Best Personal Loan
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.
Frequently asked questions
- Can you pay off a Discover personal loan early?
Yes, you can pay off a Discover personal loan early with no prepayment penalty.
- Is it difficult to get a Discover personal loan?
Discover personal loans require a minimum credit score of 660 and a minimum household income of $25,000. Compare personal loan options for your credit score.
- How fast do you get a Discover personal loan?
Discover can approve your loan application on the same day you apply. Once you sign the loan agreement, Discover can fund your loan the next business day.
