PenFed Personal Loans: 2021 Review

PenFed offers smaller personal loans and a strong customer experience, and borrowers can pre-qualify.
Annie MillerberndJan 22, 2021

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Our Take


NerdWallet rating 

The bottom line: PenFed’s personal loans are ideal for good-credit borrowers looking for a small loan with a low rate.

PenFed Credit Union Personal Loan

PenFed Credit Union Personal Loan

Min. Credit Score


Est. APR

5.99 - 17.99%

Loan Amount

$500 - $20,000

Pros & Cons


  • Soft credit check with pre-qualification.
  • Joint loan option.
  • Offers mobile app to manage your loan.
  • Offers small loans of $500.


  • Does not offer direct payment to creditors with debt consolidation loans.
  • No co-sign or secured loan option.
  • No option to change your payment date.

Compare to Other Lenders

NerdWallet rating 
NerdWallet rating 
Est. APR

5.94 - 35.47%

Est. APR

18.00 - 35.99%

Loan Term

2 to 7 years

Loan Term

2 to 5 years

Loan Amount

$1,000 - $50,000

Loan Amount

$1,500 - $20,000

Min. Credit Score


Min. Credit Score


Compare estimated rates from multiple lenders

Compare Rates

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Full Review

To review PenFed, NerdWallet collected more than 40 data points from the lender, confirmed details with customer service representatives 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.

PenFed offers small loans of $500 to $20,000 with repayment terms between one and five years.

The third-largest federal credit union by assets, PenFed is best known for serving military members, but anyone can join by funding a savings account with a minimum of $5.

The lender lets borrowers pre-qualify — a feature you don’t see with many federal credit unions — and it couples a well-rated mobile app with seven-day customer service.

Existing members’ history with the credit union is considered as part of their PenFed loan application, according to customer service representatives. If you have less-than-stellar credit, a history of making on-time payments toward credit cards and other loans and keeping your bank account above $0 could help you qualify.

PenFed is best for borrowers who:

  • Are PenFed members.

  • Have a strong history with the credit union; good credit (690 FICO or better) is preferred.

  • Need a somewhat small loan.

  • Value a strong customer experience.

PenFed at a glance

Credit building

  • Soft credit check to pre-qualify.

  • Reports payments to three credit bureaus.


  • APRs are low among lenders targeting good-credit borrowers.

  • No origination or prepayment fees.

  • No rate discount for autopayments.

Loan flexibility

  • Offers unsecured and joint loans.

  • Allows only one change to payment date.

  • Offers refinancing option.

  • Funds loans within one week.

  • Available in all 50 states.


  • Rates and terms aren’t easily discoverable on website.

  • FAQ answers key borrower questions.

Customer experience

  • Offers multiple customer contact channels and seven-day support.

  • Offers mobile app to manage loan.

Where PenFed stands out

Low rates: PenFed has low rates compared with other good-credit lenders, but it doesn’t currently offer a rate discount for setting up autopayments.

Soft credit check to pre-qualify: Unlike other credit unions or even major banks, PenFed lets you pre-qualify online to see your potential rates and loan amounts without affecting your credit score. The credit union says borrowers may see up to four offers when they pre-qualify.

Small loan amounts: PenFed loans start at $500, which is low compared to bank and online lenders, but typical for credit unions. The small amounts combined with rates below 18% make them a solid alternative to high-interest payday loans for emergency expenses or repairs. The credit union’s maximum loan amount of $20,000 is also lower than many lenders.

Joint loan option: You can add a co-borrower with better credit or a higher income to your loan application to help improve your chances of qualifying or getting a lower rate. This person would have equal access to the funds and share responsibility for repaying the loan.

Where PenFed falls short

No secured or co-signed loan options: PenFed does not let borrowers secure a personal loan with a certificate of deposit account or vehicle. Borrowers also can’t add a co-signer to their application to improve their chances of qualifying. Like a joint borrower, a co-signer can improve your chances of qualifying, though they can’t use the funds.

No direct payments to creditors: Unlike lenders that focus on debt consolidation, PenFed does not send payments directly to creditors when you consolidate debts with a loan. Instead, the funds are deposited into your checking account and you pay off your other debts yourself.

No option to change your payment date: You can choose your payment date after you sign the loan agreement, but you can’t change it after the first payment is due. Many lenders either let you choose your payment date before you sign the loan agreement or change it during the lifetime of the loan. Some let you do both.

How to qualify for a PenFed loan

PenFed doesn’t make many borrower requirements public, but a credit history showing on-time payments goes a long way, according to customer service representatives. This lender checks Experian when evaluating borrowers.

Here’s what it says you need to qualify:

  • Minimum credit score: 700.

  • Minimum credit history: Three years.

  • Low debt-to-income ratio — many lenders require a DTI of 40% or lower.

  • Minimum income: None.

Loan example: A three-year, $20,000 loan with a 17.4% APR would cost $717 in monthly payments. You’d pay $5,812 in total interest on that loan.

How to get a PenFed loan

Apply on PenFed

Before you can apply for a personal loan, you have to become a PenFed member. Once you’re a member, you can pre-qualify and accept a loan offer to begin the online application process.

Pre-qualify on NerdWallet

NerdWallet recommends comparing loans to find the best rate for you. Pre-qualifying may get you personalized rates from multiple lenders that partner with us. Pre-qualifying will not impact your credit.

Personal Loans Rating Methodology

NerdWallet’s review process evaluates and rates personal loan products from more than 30 lenders. We collect over 45 data points from each lender, interview company representatives and compare the lender with others that seek the same customer or offer a similar personal loan product. 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. 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.

This methodology applies only to lenders that cap interest rates at 36%, the maximum rate most financial experts and consumer advocates agree is the acceptable limit for a loan to be affordable. NerdWallet does not receive compensation for our star ratings. Read our editorial guidelines.