low interest personal loan

How to choose Cheap Personal Loans

Compare Top 10 Best low-interest personal loans

A low-interest personal loan is designed for people like us who urgently need money but cannot avail of other loan options. A low-interest personal loan will always charge a higher interest rate than a home loan or any other traditional type of credit card or loan.

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The higher interest rate charged by this credit product is typical because the bank or the other lending institution assumes more risk on offering this kind of credit product to the consumer. The higher rate of interest charged also serves as an extra deterrent to the consumer who might consider misusing this type of credit product.

Personal loans can help relieve short-term financial strains or have some extra cash flow every month. They tend to give you more freedom and flexibility than unsecured loans, and they’re a popular alternative to payday loans.

For college, personal loans are also called personal student loan, customers who have no credit history, and customers who have bad credit personal loan.

The loan is generally provided by private lenders or by community banks. There are no specific criteria for eligibility for a low-interest personal loan. The borrower does not need to maintain any credit history to qualify for this type of loan, apart from evidence of current income.

There are so many scenarios where you may need a personal. For example, if you urgently need extra cash but cannot extend your credit with a credit card or a personal loan from your bank. Or if you have overspent your current balance and need to make payments on the following day, or you want to book your dream holiday early and avoid extra payment charges.

Unlike a payday or installment loan online, a personal loan involves a particular amount of money one can borrow for various purposes. Personal loans are readily available in banks, credit unions, or online lenders. There are even lenders that offer personal loans for bad credit individuals. The amount borrowed must be repaid over time ranging from 12 to 84 months with some interest. Once you have paid your loan in full, your loan account is closed.

Different types of Personal Loans are as follows:

Personal loans can be used to cover up any expenses. Some of them are listed below:

Wedding Loan

Weddings are an exquisite affair and can happen to be pretty steep. Rather than spending all the savings, one can easily go for a marriage loan.

Travel loan

Almost everyone loves traveling. However, it comes with a huge expense. We can easily fund expensive family trips and vacations abroad with a travel loan. 

Medical loan

In case of an urgent medical expenditure, you can apply for a medical emergency loan. If you do not have medical insurance, this loan can be of great help to cover up your medical expenses. 

Higher education loan

A personal loan for higher education helps you finance your tuition fees and other aspects of studying abroad like accommodation, traveling, living expenses, etc. 

Personal loans are an attractive and cheap loaning option because of their low interest rates.

Best 10 Cheap Personal Loans

Lightstream

LightStream offers low-interest loans along with flexible terms for people with a credit score of a minimum of 660.

Pros:

  • Low Rates: LightStream loan annual percentage rate begins at a very low amount, which is very competitive.
  • No Fees: LightStream does not charge any origination fees or late fees on its loans.
  • Fast Approval: Qualified lenders can receive their funds quickly.

Cons:

  • High Loan Amount: Minimum loan amount is a bit high, which is $5000.
  • Long Credit History: LightStream requires applicants to have several years of strong credit history with few or no delinquencies.

Sofi

SoFi has a simple sign-up application process along with a user-friendly application to manage your payments easily. SoFi offers to co-sign and join loan options to its applicants along with an unemployment protection facility.

Pros:

  • No Fees: SoFi does not charge any late fees or origination fees.
  • Digital Experience: The entire process takes place online on a mobile application.
  • Flexible: SoFi is a great option to fund a variety of purchases. One can have more than one SoFi loan at a time.

Cons:

  • There is no secured loan option.
  • SoFi requires a minimum credit score of 680 to be approved for a personal loan.
  • SoFi is a time-consuming personal loan. It takes a lot of time to get a loan approved and have funds disbursed.

Marcus

Marcus by Goldman Sachs is a great choice if you are looking for a no-fee personal loan for making a large one-time purchase or investment. Marcus has a wide variety of repayment term options and competitive rates among online lenders.

Pros:

  • No Fees: Marcus does not charge any early payoff fees or late fees.
  • Credibility: If you invest your money in Marcus’ Personal Loan, then your money is safe. Marcus is reliable and authorized by the Financial Conduct Authority.

Cons:

  • No Branches: This online bank does not have any branches. However, they do have a mobile banking application available on the app store and Google Play Store.
  • Marcus does not provide the option for co-signing, joint, or secured loans.
  • Funding by Marcus can take up to five days.

Penfed

PenFed stands for Pentagon Federal Credit Union. PenFed offers membership to the general public and provides several personal loans for home improvement, health expenses, financial needs, and many more.

 The applicant is required to have a minimum credit score of 650. Anyone can apply for a loan with PenFed. However, upon approval, if you choose to go ahead, you need to become a member of PenFed to receive funding.

Pros:

  • PendFed requires very few qualifications for loan approval.
  • Funding is fast, and one may receive funds within a day.
  • PenFed does not charge any origination fees or hidden fees.

Cons:

  • PenFed requires you to open a savings account to become its member.
  • PenFed loans amount only up to $20,000.

U.S Bank

The U.S Bank Simple Loan offers a quick and convenient process for U.S Bank customers to manage planned and unplanned expenses. With a simple online process, U.S Banks offer unsecured personal loans that range from $1,000 to $25,000. Loan terms can run between 12 to 60 months.

Pros:

  • Quick Access: One can easily access the money within one business day.
  • Offers Discount:S Bank offers an APR discount if you sign up for automatic payments.
  • S Bank does not charge any origination fees or prepayment penalty

Cons: 

  • S Bank Account Required: U.S bank offers a personal loan for its existing customers. To qualify for a personal loan, you must have an account for at least 120 days.
  • S Bank only offers small loan limits up to $25,000

How to compare low-interest personal loans?

Now that we have the top 5 options to secure the best cheap personal loans let’s look at some tips for comparing low-interest personal loans.

If you are taking out a personal loan, you must ensure that you get the best deal possible from your lender.

Make sure that you follow these tips when you are comparing loan offers:

  • Get quotes from at least three different lenders or more.
  • Look for those lenders that allow you to compare small business loan or personal loan offers without hard credit inquiries.
  • Consider the loan’s term and monthly payments. Evaluate how the costs fit into your monthly budget.
  • Consider the features that lenders offer to find a loan that fits your needs.

Taking a personal loan might prove to be a wise decision to meet your expenses or funding requirements. But, before you make any judgment on a personal loan, make sure you compare foreclosure charges, service charges, and all other hidden expenses incorporated with this.

Personal loans are undoubtedly a great option and relatively easy to procure these days. To see the estimated rates and credit score payments, one can use their loan calculator.

If you are taking a personal loan to consolidate your debts, plan wisely to pay off your creditors and avoid landing into debt again.

Personal loans often work better for a large expense that can be easily repaid over the years.

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