Methodology: How we picked the best small personal loans
First, we analyzed nearly 100 lenders and selected personal loans with a starting loan amount of $1,000 or lower. We then looked at the lenders with the best reviews, the lowest interest rates, and the most competitive fees.
Getting a small personal loan isn't difficult, even if you have bad credit. The challenge is finding lenders with low interest rates and fees. Payday and auto title lenders specialize in small loans, but the cost can be exorbitant. In some cases, they can pull borrowers in a cycle of never-ending debt. Instead, try the personal loans listed above and only use high interest lenders as a last resort.
Common Questions on Small Personal Loans
What is a small personal loan?
Small personal loans are usually unsecured cash advances that are used to get you through an unexpected financial tight spot. They are designed to be short term in nature, with a typical time frame to repay the money being anywhere from a couple of months up to several years.
The interest on these loans is usually fixed, which means your monthly payments won’t change throughout the life of the loan. Rates and fees vary widely depending on the lender, so it is important to shop around and compare terms before choosing a loan.
What credit score do you need for a small personal loan?
Each lender has its own eligibility requirements, so it depends on which personal loan you are considering. There isn't a set minimum credit score, so a small personal loan with bad credit is possible for various borrowers. However, the higher your credit score, the better the rates and terms. Interest rates can also vary substantially from lender to lender regardless of your credit score. That is why it's so important to apply with multiple lenders before you make a decision.
Can I get a small personal loan with bad credit?
Yes, you can qualify for a small personal loan even if you have poor credit. However, lenders only offer their best rates to borrowers with good to excellent credit. In general, the better your credit history, the lower your interest rate.
Do small personal loans hurt your credit?
Initially, your credit may get dinged when the lender makes a hard pull on your credit report. However, in the long run, personal loans can help you improve your credit score if you make regular and on-time payments. Consolidating revolving credit, such as credit card debt, into a personal loan can also help you reduce your credit utilization ratio, which can also improve your credit score.
Who has the best small personal loan rates?
It depends on who is asking. The rates lenders offer will vary depending on the credit history, income, and debt levels of borrowers. Check the lenders above to find the best rates and terms for your financial situation.