best personal loans for 2022

The air conditioner will break. Or your pet needs expensive surgery. Or maybe you’re paying off a credit card debt. In any case, if you need a lot of cash, a personal loan comes in handy.

Unlike other forms of debt, personal loans are usually unsecured. In other words, there is no collateral. Since you don’t need to use assets, secure a loan, personal loans are an easy and convenient way to consolidate debt, pay medical bills, or cover an unexpected car repair. You pay off the loan in fixed monthly installments, but you can usually get a lower interest rate on a personal loan than on a regular loan. credit card.

You can get personal loans from banks, credit unions, and online lenders. Available interest rates, fees, repayment terms, and borrower requirements can vary widely, so it’s a good idea to do some research. But with so many options, it can be difficult to know where to start.

To help you narrow down your choices, we’ve put together a list of the 5 best personal loans for 2022. Interest rate information for these lenders is current as of September 26, 2022. Once you’ve decided on these loans and our criteria, scroll down to learn more.


Best overall

light stream

Key stats:

  • Loan Amount: $5,000 to $100,000
  • Loan terms: 2 to 12 years
  • Outgoing Fee: 0%
  • April: 4.49% to 19.99% (minimum rate includes 0.50% autopay discount)

Reason for choosing: Lightstream stands out from its competitors due to its low interest rates, loan amounts and available loan terms. Additionally, Lightstream does not charge an origination fee, a fee some lenders charge and deduct from the loan amount.

Of all the lenders we looked at, Lightstream had the lowest possible interest rates for borrowers with excellent credit. Annual rate, or APR, at 4.49%, was significantly lower than the highest APR offered by other lenders. If you qualify for a low-interest unsecured personal loan from another lender, Lightstream offers him a 0.10% lower interest rate.

Lightstream allows borrowers to borrow between $5,000 and $100,000, making it a good choice if you’re financing an expensive home improvement project or need to cover optional medical procedures. In contrast, most personal loan lenders have a maximum amount of less than $50,000 for him.

While many lenders take 2-5 business days to process loan applications and disburse funds, Lightstream issues loans immediately after application. Its fast payout time is a great advantage if you need the money right away.

warning: Lightstream is available to borrowers nationwide, but not everyone is eligible for a loan from a lender. Lightstream does not list a specific minimum credit score, but emphasizes that it only approves borrowers with good to good credit. According to Equifax, one of the three largest credit bureaus, borrowers typically: Score over 670.

Lightstream is also unique in offering different interest rates and repayment options based on the intended use of the loan. For example, the lowest possible APR for a personal loan used to consolidate credit card debt is 5.73%, while the lowest possible APR for a loan used to finance solar panels is 4.99%. So even if you have a great credit profile, you may not be able to take advantage of Lightstream’s minimum advertising rates.


Great for debt consolidation

Discover

Key stats:

  • Loan Amount: $2,500 – $35,000
  • Loan terms: 3 to 7 years
  • Outgoing Fee: 0%
  • April: 5.99% to 24.99%

Reason for choosing: With most personal loans, the lender usually pays you the funds. But if you are going to take out a loan, consolidate high interest debt, Discover pays creditors directly, streamlining the debt consolidation process. Your debt will be paid off sooner and the money won’t be deposited in your bank account, so there’s no temptation to spend it.

Discover offers competitive interest rates and no origination fees. If the loan is approved, Discover will disburse the funds the next business day.

Discover backs your loan with a 30-day money-back guarantee. If you change your mind about the loan within 30 days of the loan being issued, you can return the funds by check and Discover will not charge interest. However, this feature is only available if Discover pays the funds directly to you. Money-back guarantees are not available to borrowers who choose to pay creditors directly.

warning: Discover can be a good option for many borrowers, but there are some drawbacks to keep in mind. For example, Discover has no prepayment penalties, but a relatively high late fee of $39. For other lenders, fees typically range from $10 to $25.

Discover does not list a minimum credit score.But according to his 2021 annual report for Discover, his 99% of personal loan borrowers Score 660 or higherLenders do not offer secured loans or joint applications, so only borrowers with good to good credit are eligible for loans from Discover.


Best for borrowers with low credit

upgrade

Key stats:

  • Loan Amount: $1,000 to $50,000
  • Loan terms: 3 or 5 years
  • Outgoing Fee: 1.85% to 8%
  • April: 7.46% to 35.97%

Reason for choosing: If you have a poor credit score, i.e. score below 670, you may have trouble qualifying for a personal loan from most major lenders. However, there are some upgrade options for borrowers with less than perfect credit.

  • Joint application: If you have relatives or friends with good credit, they can apply for a loan with you, increasing your chances of getting a loan. However, please note that both applicants are responsible for repaying the loan. Therefore, in case of delay, the co-applicant must bear the payment.
  • Auto secured loan: If an unsecured personal loan is not available due to your creditworthiness, or if you are approved for less than the required amount, Upgrade may offer you the option of a secured loan using your car as collateral. An upgrade secure car loan may increase your chances of qualifying for a loan and getting a more competitive interest rate.

warning: Unlike lenders like Lightstream and Discover, Upgrade charges an origination fee. That fee can be as high as 8% and the fee is deducted from the loan amount. For example, if you borrow $5,000 with an 8% origination fee, the fee will be $400 and you will only receive $4,600 when the loan is paid.

Upgrades have limited repayment options and are only available for 3 or 5 year terms. Also, poor or fair borrowers may get double-digit APRs.


Great for quick fundraising

Sophie

Key stats:

  • Loan Amount: $5,000 to $100,000
  • Loan terms: 3 to 7 years
  • Outgoing Fee: 0%
  • April: 7.99% to 23.43% (minimum rate includes 0.25% autopay discount)

Reason for choosing: Whether you have to fix your car’s transmission or your roommate has moved out and is behind on your rent, when an emergency strikes, you don’t have a lot of time to waste. While many lenders can take several days to disburse loan funds, SoFi pays loans as soon as an application is completed.

Other lenders, such as our top pick Lightstream, boast same day loans. However, the deadline to schedule funding is 2:30 PM ET and the borrower may be required to pay wire transfer fees.

SoFi gives borrowers more time. According to SoFi, the majority of loans approved and signed before 7 p.m. ET on a business day were funded on the same day. What’s more, SoFi charges no initiation or late fees and offers loans of as much as $100,000.

warning: Those in need of quick cash will find SoFi’s loans attractive, but SoFi’s highest possible APR is higher than what other lenders offer. Additionally, larger loans of $20,000 or more may require additional processing time.

Qualifying for a SoFi personal loan can be difficult. SoFi doesn’t list the minimum credit score, but the weighted average FICO score for his SoFi personal loan borrowers in 2021 was 754. If your credit score is in the good or average range, you may not be eligible for a loan.


Great for small loans

PenFed Credit Union

Key stats:

  • Loan Amount: $600 to $50,000
  • Loan terms: 1 to 5 years
  • Outgoing Fee: 0%
  • April: 7.74% to 17.99%

Reasons for choosing II: Most personal loan lenders offer a minimum loan of $2,500 or more. If you need less, you will be forced to borrow more than you need and pay interest on the higher amount. But with PenFed Credit Union, you can borrow from as little as $600.

PenFed Credit Union offers competitive interest rates and no origination fees. Borrowers with less than perfect credit ratings can increase their chances of qualifying for a loan by applying to co-borrowers. PenFed is one of the few lenders that allows joint applications.

warning: To qualify for a personal loan from PenFed, you must be a member of a credit union. Some credit unions limit membership to specific groups, but PenFed is open to the public. However, you must open a savings account, deposit at least $5 first, and join a credit union.

PenFed pays loans electronically or by paper check. Electronic loan payments typically take 1-2 business days, while checks can take up to 7 business days.


Consider more personal loans

Marcus by Goldman Sachs

According to JD Power, Goldman Sachs’ Marcus has the highest ratings for customer service, offering loans from $3,500 to $40,000 with no loan fees or late fees. However, Marcus takes longer to disburse funds than other lenders, and it usually takes him more than three business days to issue a loan.

lending point

LendingPoint caters to borrowers who may have trouble getting loans elsewhere. We serve customers with scores as low as 550, well below the minimum scores required by other lenders. However, borrowers with good to good credit may be better off with other lenders. LendingPoint has an origination fee of 7% and an APR of 35.99%. Also, his LendingPoint is not available to residents of Nevada or West Virginia.

Our Best Personal Loan Methodology

We selected WSJ’s Best Personal Loan based on available interest rates, fees, repayment terms, and loan amounts. Also, borrowers looking for personal loans often need money quickly and cannot wait a few days, so we looked for lenders that are available nationwide and offer quick payouts.

We evaluated 24 lenders and used the listed companies to identify our selection. JD Power 2022 Consumer Lending Satisfaction StudyRates and terms listed for all lenders are current as of September 26, 2022.

Any advice, recommendations or rankings contained in this article are those of the WSJ editorial team buy-side and have not been reviewed or endorsed by our commercial partners.

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