Small Personal Loans
Need some quick cash to take care of that emergency medical bill? Repair your car, maybe? Or just stay afloat? Traditional bank loans may not help. The fairly long process of application and approval may not favor you. That’s where small personal loans come in.
They will help you sort out your emergency bills, thanks to their faster and easier rate of approval. We cover everything you should know about them and single out some of the top lenders.
- Representative APR
- Min. Credit Score
- Min. Amount
Upgrade
- 7.99 - 35.97%
- 580
- $1,000
LendingClub
- 10.68 - 35.89%
- 600
- $1,000
Upstart
- 6.16 - 35.99%
- 580
- $1,000
- APR range
- Fees
- Terms
- Amounth
- Unemployment protection
Bank 1
- 6.95%–35.89%
- Up to 5% transfer fee
- 3–5 years
- $1,000–$40,000
- No
Bank 2
- 6.95%–35.89%
- Up to 5% transfer fee
- 3–5 years
- $1,000–$40,000
- No
Bank 3
- 6.95%–35.89%
- Up to 5% transfer fee
- 3–5 years
- $1,000–$40,000
- No
Table of Contents
How do Small Personal Loans work?
Small personal loans offer you convenience when sorting out your small cash needs and those one-off bills that you can’t postpone.
For small personal loans, online lenders and credit unions are the most preferred.
Their approval rate is high, and you can access loans even with a poor credit profile. Plus, you’ll get your cash within 24 hours of application and approval.
Application is purely online. Once done, the lender will check your financial background and approve a loan that suits you.
You’ll mostly have from 3 to 12 months to repay your loan and most lenders will offer you $1,000.
Since most online lenders are unregulated, be on the watch for lenders with unfavorable terms and exorbitant interest rates. Also, be on the look for scammers.
You’ll mostly have from 3 to 12 months to repay your loan and most lenders will offer you $1,000.
Requirements to Qualify
For small personal loans, the basic lender requirements include;
- You must be at least 18 years old
- You should be a resident in the United States
Your credit profile is also a key element. An excellent credit profile will have a lender adjusting your loan limits positively. You’ll also have better interest rates and might just getter and more flexible repayment terms.
Some lenders will also want to see proof of income. This will help in demonstrating your ability to repay your loan. However, not all lenders will demand this.
What do you need to know
Looking to apply for a small personal loan product? Here’s what you should know;
- Interest rates: interest rates differ from one institution to another. However, most small personal loan lenders charge an average APR of between 7.99 and 35.99%. Small personal loans are known to have higher interest rates. Their interest rates, unlike common bank loans, are also not fixed. They are set based on such borrower’s data as repayment history, credit score, and other things such as guarantee and collateral, which small loan lenders rarely demand.
- Loan terms: Most small personal loans are short-term. Their repayment period is mostly from 4 weeks to 12 months. People with excellent credit profiles are also likely to get more flexible repayment terms.
- Versatility: Small personal are highly versatile. You can use them to sort medical bills, purchase households, pay your rent, or sponsor a vacation. You can also use the loan for debt consolidation, though it’s not recommended as this might place you in a recurrent debt cycle.
- Guarantee: Getting a guarantor is not a requirement for small personal loans. However, getting one could work to your advantage. You’ll access better loan terms, faster approval, and higher loan limits provided the guarantor has a stellar credit profile. A guarantee is especially crucial if you have a poor credit score.
Before settling for any loan product, shop around for lenders with favorable terms. Also, watch out for loans with higher fees.
For small personal loans, online lenders and credit unions are the most preferred. They often have better terms, faster approval rate, and their requirements aren’t hard to meet.
Also, before settling for a loan, be sure to exhaust other avenues including your savings account, and friends and family.
Small Personal Loans Online
Small personal loans are mostly available online through reputable lenders. They are among the highly sought-after loan products.
- Credit score: You can get an online personal loan with a credit score of below 600. Most small loan lenders rarely deny you a loan because of a poor credit score. However, to improve your credit reports, pay off other existing debts. You should also avoid getting hooked up on too many debts within a short period.
- Interest rate: Most online small loans hardly go past 39%. However, some would, since they’re mostly unregulated. Ideally, they’re known to be carrying the highest interest rates. Borrowers with a poor credit profile always have the highest interest rates.
- No paperwork: Application and approval of this type of loan are purely online. You don’t have to go to a physical office or fill out some sort of form. This makes application and approval easier and faster.
- Repayment term: Online small loans are short-term. Most online lenders will give you up to 6 months to clear your loan. The borrower with an excellent credit profile is more likely to have a better repayment term.
- Estimated wait time: Online loans have the shortest wait time. Depending on the lender, you’ll mostly have your loan in less than 24 hours.
Please note that some lenders have very high loan fees and interest rates. Be sure to avoid such.
Most online lenders will give you up to 6 months to clear your loan. The borrower with an excellent credit profile is more likely to have a better repayment term.
How much can you borrow?
You can borrow from $500 to $3500. You can also be eligible to even higher limits if you have an excellent credit profile. Most lenders, however, give out $1000.
Your credit profile plays a significant role in determining the amount you can borrow. If you have a lower credit score, take the necessary steps to make it better.
Responsible borrowing is the first step towards creating a good credit profile. Only borrow when you have exhausted other means.
Instead of a loan, family and friends could save you lots of cost. If you have to borrow, only go for what you need and what you’ll be comfortable repaying.
Short-Term Personal Loans
Here are some of the options you can try out;
Payday loans
These are often the go-to option for people with poor credit history. Payday loans are often used to sort out urgent bills such as emergency medical bills.
You can borrow from $50 to $1000. Their repayment period is normally 4 weeks and even people with a credit score of less than 500 can apply.
LendUp is one of the best lenders giving out payday loans.
Pros
- Will help sort emergency bills
- People with low credit score can get loans
- Faster approval
Cons
- Have high-interest rates
- High fees charged
Title loans
Here you take a loan against your vehicle. Title loans have rates slightly similar to those of payday loans. You risk losing your car should you miss out on the payment so you might want to think it through carefully before approaching a lender.
Speedycash and title max are among the best title loan lenders.
Pros
- Access to quicker loans
- Available to people with a poor credit profile
Cons
- Have high-interest rates and fees charged
Small Personal Loan guaranteed approval
Lenders such as Avant have guaranteed approval for small personal loans even for people with poor interest rates. However, applying with a poor credit score will attract higher interest rates and other fees.
For those looking to borrow $1000, Upgrade can bail you out.
Both lenders guarantee loans for borrowers with a credit score of less than 500.
Getting a co-signer can also help lower your interest rates and giving you better loan terms. For even better terms, work towards improving your credit score.
Either way, other lenders are willing to offer you loans. Be sure to shop around and see which better meets your needs. The ones on the table above are among the top lenders with the guaranteed loan approval.
Frequently Asked Questions (FAQ)
Yes. Most lenders, including the ones on the table above, accept borrowers with a credit score of less than 600.
Most lenders will disburse your money within 24 hours of application.
Many online lenders and trade unions offer small personal loans. Among the best are above tabled. Be sure to try them out.
Different lenders have different repayment terms. However, you’ll have an average of 3 to 12 months to repay your loan.
Interest rates are different based on the lender and the borrower’s credit profile. However, most lenders charge an average APR of 7.99 and 35.99%.
