Best Personal Lines of Credit for 2021
If you need extra funds to purchase something special, cover education costs, or make some improvements to your home, a line of credit might be a good option for you. It’s the flexibility that makes this financial product so special. With lines of credit, you’ll get access to a lump sum of money from you which you can withdraw funds at any time you need them. And, unlike personal loans, with lines of credit you’ll pay interest only on funds you actually use.
We’ve picked only the best personal lines of credit offers to review in this article. You’ll notice a mix of established banks and relatively new online lenders among the mix. The beauty of the internet is that there’s now so much more choice and competition, meaning that you’ll be able to find a lender that suits you no matter what your situation. And as is the case with any industry, that extra competition really helps to keep the cost of credit affordable.
Read on to find out which lenders you should consider for your line of credit.
Top Personal Lines of Credit
Tally is a San Francisco-based funding provider that uses the finest technology to help you minimize rates on your credit cards and boost your finances. Millions of consumers across the US already use its products, applauding the company’s efficient mobile app and low APR rates. Its lines of credit are most suitable for borrowers with good credit scores, steady income, and low credit card debt. Read Review
- •Low APR rates
- •Efficient mobile app
- •No fees
Upgrade is a relatively new company, but it’s already one of the more reputable personal line of credit lenders out there. It offers fixed lines of credit interest rates and short repayment terms, allowing you to have more control over your finances. Upgrade is praised for its safe application process, reasonable borrowing requirements, and helpful customer support. Read Review
- •Prequalify with a soft inquiry
- •Fixed monthly rates
- •Earn on your payments
SunTrust is a subsidiary of Truist, one of the biggest banks in the US. This bank offers various financial products, including savings and CD accounts, credit cards, loans, and lines of credit. SunTrust is the perfect option for borrowers who are looking for a line of credit with high borrowing limits. This bank also offers some of the best unsecured personal lines of credit on the market, with a borrowing limit of $250,000. Read Review
- •High borrowing limit
- •Competitive rates
- •Unsecured lines of credit
KeyBank offers the best line of credit loans that range from $250 to $5,000 with variable interest rates. This is the most suitable product for borrowers who want to get access to a small amount of money, pay it back, then use the line again. The downside of this bank is that its products are not available in all states. It also charges high fees for late payments. Read Review
- •Flexible payment options
- •Small loan amounts
- •Available in 15 states
Our Methodology for Evaluating Line of Credit Lenders and Banks
A line of credit is one of the most popular financial products in America. It has characteristics that make it similar to loans and credit cards, but it’s more flexible to use and has lower interest rates. This is why almost all banks and other funding providers offer lines of credit to their clients. They usually come with variable rates and are typically unsecured loans, but this isn’t always the case. The market is loaded with various offers, so finding the one that best fits your needs can be a daunting task.
Before you read our line of credit reviews, take a close look at our evaluation methodology. We established criteria that helped us perform our research and find the banks and online lenders that have the best personal line of credit offers.
Credit Line Types
There are three types of credit lines: business, personal, and home equity lines of credit. A personal credit line can be used for covering tuition costs, purchases, or repairs. Like all other credit lines, a personal credit line can come in one of two forms: an unsecured line of credit and a secured line of credit.
The main difference between these is that with a secured line of credit, the borrower’s property (car, home, or another valuable asset) is taken as collateral. With an unsecured credit line, you don’t need to risk any of your valuable assets to get approval. In general, a personal secured line of credit is rarely offered, and when it is, it’s usually for loans with higher borrowing limits. Most lenders offer unsecured credit lines.
Another thing we need to mention is that most lenders allow you to apply for a revolving line of credit. This means you can reopen and reuse your line of credit again once you’ve paid off your debt. That’s another advantage of this financial product; you don’t need to pass through another application process to start drawing from your credit line again.
Borrowing Amount and Terms
Each funding provider sets borrowing limits and specific repayment terms. These are the first things you should check before choosing a lender, as they will determine the cycling periods for using and paying off your line of credit.
Some lenders offer a large personal line of credit that can be worth up to $500,000, but such a large amount usually requires collateral and an excellent credit score. For each provider, we checked the minimum and the maximum borrowing amount and included that information in our review.
Another thing we considered when evaluating online lenders and banks is whether they provide a competitive APR. An APR or annual percentage rate is the amount of interest you need to pay on your principal. It differs from an interest rate because it includes all costs and fees related to a line of credit.
By comparing APRs from different lenders, you get more information than comparing only interest rates. To help you find the best personal line of credit rates, we looked for providers with the lowest APRs on the market. Most lenders offer variable-rate credit lines, meaning the rate you pay will fluctuate based on the prime rate.
Suppose you find a lender whose borrowing limits and rates perfectly fit your needs. The next thing you should do is to apply for a line of credit. Be aware that each provider has its own line of credit requirements, so there’s a chance your ideal lender doesn’t operate in your state or your credit score is too low to get approved.
Most lenders will also check your credit card balances and credit history to see if you’re eligible for a personal line of credit, with rates calculated according to your creditworthiness. It’s no surprise that the lowest-interest line of credit is offered to those with little or no debt.
On top of interest rates, some lenders might charge additional fees, the two most common of which are underwriting fees and origination fees. An underwriting fee is a fee that a lender charges to verify your personal information once you apply for a credit line. An origination fee helps cover the provider’s administrative costs.
Lenders that offer the best rate for a personal line of credit may also charge an annual fee as well as penalty and late payment fees.
Sometimes additional costs can influence your final decision when choosing an online line of credit. Before making a decision about where you want to apply for a personal line of credit, see if there are any additional fees you are required to pay.
Finally, we evaluated providers based on how good their customer support is. We looked for banks and lenders with polite, fast, and knowledgeable agents who are available at the most important times via various channels of communication.
4 Best Personal Lines of Credit - Detailed Reviews
Tally Technologies is a San Francisco-based company that has been around for five years, offering financial services through its mobile app. The company was founded by Jason Brown and Jasper Platz, whose vision was to establish a startup that focuses on helping clients get the most from their credit cards.
In order to do that, the co-founders devised a mobile app that analyzes clients’ financial health and can provide a personal line of credit with a low APR.
Now, with more than a million clients nationwide, Tally offers unique lines of credit loans for tech-savvy consumers who want to manage multiple credit card rates with low-interest lines of credit.
Tally’s Mobile App
Tally’s main selling point is its financial mobile app. This app helps you organize all your credit cards and manage debts from one place. Regardless of how many credit cards you have, you can quickly connect them with Tally and track the balances of each.
The Tally app analyzes your financial health and helps you find the most affordable model to pay off your debts. Not only does the app make payments much easier, but it can also help you save some money by getting lines of credit with low APR.
The process is really simple. After analyzing the balances on your credit cards, Tally will offer you the personal credit line rates with the lowest APR to help you recover your financial health. Instead of paying off multiple cards with different APRs each month, you’ll only have to make one payment for Tally’s line of credit.
The Tally app is free and you can download it and use it as soon as you apply for a line of credit. It also comes with late fee protection; the app scans your cards each month before the due date arrives to make sure that you have enough funds in your account.
Credit Line Features
Tally offers lines of credit that range from $2,000 to $20,000. You can apply for a line of credit through the mobile app. The application is entirely free, as is maintaining your account. Unlike many other line of credit companies, Tally won’t charge you origination fees and prepayment penalties. The only thing you’ll pay is an interest rate.
Tally’s APR starts at 7.9%, which is really low, especially compared to other online lenders. Tally’s monthly rates are not fixed, meaning that they depend on market fluctuation. The maximum APR at Tally is 25.9%.
To apply for a line of credit at Tally, you need to have a credit score of at least 660 and a regular income. Based on these parameters, as well as the amount of money you apply for, Tally calculates your rates.
One of the best things about using Tally’s line of credit is that you can get really low personal line of credit rates in spite of your debts. Depending on how much you owe, Tally will decide whether you’re a good candidate for a line of credit and how high an interest rate you need to pay.
Of course, you’ll get better rates if you don’t have any debt, but you can still benefit from Tally even with some small debts on your cards.
Tally’s line of credit is for consumers who have good to excellent credit scores, relatively little debt, and steady income. It’s one of the most convenient lenders for those looking to get line of credit loans to cover existing debts and save some money with a low personal line of credit interest rate.
However, if you aren’t a resident of Washington DC or one of the 30 states where Tally operates, you can’t qualify for a line of credit. Also, the company doesn’t offer lines of credit for all credit cards. On the company’s site, you’ll find a list of banks and companies that are supported by Tally.
Reasons to Apply:
- Helps you improve your finances
- Late fee protection
- No maintenance fees
- Technology-oriented company
Established in 2017, Upgrade is one of the fastest-growing online lenders. It has offices in San Francisco, Phoenix, Chicago, and Montreal in Canada, and it has already distributed funds to more than 10 million people. This is a reputable company fintech company that employs excellent security measures to protect your transactions.
Clients benefit from this lender’s short-term loans and unsecured personal lines of credit. In addition, you can use Upgrade’s credit health tools to stay on top of your finances.
Credit Line Features
The company offers its own highly rated financial product: an Upgrade Card with a personal credit line. It’s a product that combines the advantages of both credit cards and term loans. The amount you can borrow ranges from $500 to $50,000 and you access funds from your Upgrade Visa card or from your bank account.
The main advantage of using Upgrade’s personal credit line is that you can make multiple withdrawals from your account and you’ll always have a fixed interest rate. The Upgrade Card comes with personal line of credit rates and terms, saving you from unpredictable market fluctuations.
With Upgrade’s revolving personal line of credit, you can get 1.5% cashback on your purchases after you pay them back. You can shop online or in any physical location that accepts Visa cards. However, the Upgrade Card can’t be used to withdraw funds from ATMs.
One of the biggest drawbacks of Upgrade’s lines of credit is that they come with limited repayment terms. You can either choose a 36-month repayment term or check if you are eligible for a 60-month repayment option. The positive is that lines of credit don’t come with any additional fees, like origination or underwriting fees.
Personal Line of Credit Requirements and Application
Whether you apply for a loan or a line of credit, Upgrade requires a minimum credit score of 620. The lender will perform a soft pull to check your credit score, which will not affect your FICO. However, when you submit your application at Upgrade, the company will make a hard credit inquiry. Usually this means a drop of at least 10 points from your credit score.
Aside from credit score requirements, you’ll also need to provide information about your income to apply for a credit line. Upgrade asks for two types of income information: one is a summary of your annual salary, while the other covers additional sources of income like child support or your spouse’s income.
Credit Health Program
If you’re looking for a bad credit personal line of credit, you’re better off looking elsewhere, as Upgrade requires a credit score of at least 620. If you’re not sure whether you’ll be eligible for a loan, the lender allows you to check your credit score with its financial tool before applying.
Upgrade’s credit monitoring tool enables you to check your credit score at any time and gives you advice on how to improve it. With this app, you’ll get notifications each time your credit score changes.
Security and Support
We’ll start by pointing out that Upgrade’s lack of transparency around minimum requirements is frustrating; much of that information is missing from the site. Should you have any questions about signing up for Upgrade’s personal line of credit loans, the company’s agents are available via email and phone.
You can call up and talk with support officers on business days from 6 a.m. to 6 p.m, and during weekends from 6 a.m. to 5 p.m. (PT).
If you borrow money from Upgrade, you can rest assured that your private information and your transactions will be secured with the latest technology.
Reasons to Apply:
- Fast funding
- Secures your transactions
- Credit monitoring tools
- Fast online application
If you’re looking for a line of credit for big purchases, SunTrust might be the perfect option for you. This is the best bank for a line of credit when it comes to high borrowing limits. You can get a loan of up to $250,000 with affordable rates but short repayment terms.
SunTrust provides various financial services and products, including business and private loans, mortgage loans, auto loans, credit cards, and many others. It’s a reputable bank and subsidiary of Truist, which is one of the largest financial companies in the US, holding around $200 billion worth of assets.
Credit Line Features
SunTrust offers two line of credit options: Personal Credit Line Plus and Select Credit Line. Both options come with low APRs and high borrowing limits, but the one we’re most interested in for this review is Personal Credit Line Plus.
Personal Credit Line Plus is an unsecured personal line of credit, meaning you don’t need to have any collateral (like a home or some other valuable asset) to apply for this loan. The amount you can borrow ranges between $25,000 and $250,000. The borrowing limit can go up to $500,000 for private wealth management clients.
SunTrust provides a line of credit loan that comes with variable interest rates. Currently, the APR ranges from 8% to 10.60%. The final rate is calculated based on your borrowing amount and your creditworthiness.
Personal Credit Line Plus comes with a line term of four years.
SunTrust offers excellent online and mobile banking services with an application procedure that takes only 15 minutes. To be eligible for a personal unsecured line of credit, you’ll need to meet SunTrust’s minimum income requirements. You need to have at least $100,000 worth of investable assets in your accounts (CDs, savings accounts, or other) to apply for a SunTrust line of credit.
One of the biggest drawbacks of this bank is that there’s no way to prequalify for a loan. SunTrust will perform a hard credit inquiry to see if you are eligible for a loan, a process that will inevitably decrease your credit score. For those who have an excellent credit score, this won’t be a problem.
However, if you have a low FICO score, you may not get instant approval for a personal line of credit at SunTrust. The bank doesn’t disclose its minimum credit score requirement on its website, so feel free to contact support agents to learn more.
Another drawback of this bank is that you need to sign loan documents in person. While you can apply for a line of credit online or by phone, once you get approved, you’ll need to schedule an appointment at a SunTrust branch to personally sign the loan. We found this to be SunTrust’s biggest weakness compared to online lenders, especially during the COVID-19 crisis.
The bank offers a few ways to get in touch with an agent and see how you can get the best line of credit rates. The quickest option is to talk with an agent over the phone. Phone support is available from Monday to Friday between 9 a.m. and 5 p.m (ET). You can also log in to your account and use ticketing support.
All information associated with your line of credit is available within your online account. You can log in through the bank’s website, or you can download the mobile app. SunTrust has a help center loaded with articles and guides that can also put you on the right track.
Reasons to Apply:
- Online and mobile banking
- Fast customer support
- Wide range of additional products
- Reputable bank
The next best bank for a personal line of credit is KeyBank. KeyBank is a Cleveland-based financial institution with 1,197 branches and more than 1,500 ATMs across the states. The bank was established in 1849 and today sits at number 29 on the list of largest banks in the country.
KeyBank offers various types of loans, lines of credit, savings and CD accounts, as well as money market accounts. It’s also known for providing life insurance.
Credit Line Features
One of the most popular KeyBank’s products are lines of credit. KeyBank allows clients to easily apply for and get a revolving line of credit. Lines of credit loans like this can be reused as many times as you want. You get a lump sum of money and once you pay off your debt, you can access the funds again, which is convenient because you don’t need to go through the approval process every time.
You can use KeyBank’s lines of credit as you want - to make purchases, home improvements, or pay off debts. Moreover, you can use a line of credit for overdraft protection. This is a good option if you have KeyBank’s checking account.
KeyBank’s lines of credit are designed for borrowers who need a lump sum of money fast. The bank distributes money to your account really quickly thanks to its excellent online banking system.
KeyBank’s personal line of credit loan - called KeyBasic Credit Line - is perfect for borrowing a small amount of money. You can get a KeyBasic loan from $250 to $5,000 without providing any collateral. There’s also the KeyBank Preferred Credit Line, which ranges from $2,000 to $25,000.
To open an account at KeyBank and apply for a line of credit, you must be at least 18. KeyBank requires your personal information, including your name, address, and Social Security number. The bank will also check your credit score at Equifax and ask for your financial statements. Unfortunately, there is no information about credit score requirements provided on the bank’s website.
The biggest drawback of the bank’s personal line of credit is that it’s not available in all states. If you’re a resident of the following states you can apply for a loan: Alaska, Colorado, Connecticut, Idaho, Indiana, Massachusetts, Maine, Minnesota, New York, Ohio, Oregon, Pennsylvania, Utah, Vermont, and Washington.
APR and Fees
KeyBank’s unsecured lines of credit come with a variable interest rate. The APR ranges from 11.99% to 17.74%, depending on your creditworthiness. You’ll also need to pay an annual fee of $25, and the bank charges a late payment fee that can be as high as $35. There’s also a fee of up to $35 on returned items.
If you’re wondering whether KeyBank is the best place to get a line of credit, you can contact the bank’s agents and get additional information about the product. Support is available via phone, live chat, and email.
Reasons to Apply:
- Proactive customer support
- No collateral
- Online banking
- Overdraft protection
Fortunly’s Guide to Personal Lines of Credit
A personal line of credit can help you alleviate financial crises, pay off debts, invest in home improvement, or make big purchases. It’s more flexible than a standard term loan and it can usually be reused once you pay it off. Choosing a personal line of credit can be a good option, especially if you have a good credit score and stable income. Typically, the better your credit score and the more money you earn, the better the APR you’ll qualify for.
What is a personal line of credit?
A variable or fixed-rate personal line of credit is a financial product similar to traditional loans. With a credit line, you get a lump sum of money and you draw from it as many times as you want, but you don’t need to use the entire amount. After you pay off the credit line, you can start drawing funds again. Its best feature is that you pay interest only on the amount you use.
Credit lines are fairly similar to credit cards, but you’ll pay lower rates, especially if your credit score is good.
How to get a personal line of credit?
Both banks and online lenders offer lines of credit for personal use. To apply for such an offer, you need to meet borrowing requirements that differ from lender to lender. For example, many of them require a credit score of at least 660 points. There are lenders that offer a personal line of credit for people with bad credit, but in that case you should be prepared to pay high rates.
Aside from your credit score, lenders will also check your credit history and your income. You’ll also be asked to provide a range of personal details like your name, address, Social Security number, passport, and possibly a valid driving license.
How does a personal line of credit work?
Once you get approved for a line of credit, you can expect the money to arrive in your account really quickly. You don’t need to take all the money immediately. Instead, you can draw funds periodically and pay only for what you use.
Personal line of credit vs loan
As we’ve mentioned, a personal line of credit is similar to a personal loan. However, they differ from each other in one important way. With a personal loan, you’ll pay interest on the entire loan amount you’ve borrowed, while with a line of credit, you pay interest only on the amount you actually spend.
If your credit score is good or excellent, you have a steady income, and you know you can repay the debt on time, then a personal line of credit is a good choice.
Various banks and online providers offer lines of credit. We evaluated only the best ones, so choosing any option from our list is a good idea.
It depends on your financial goal. Generally, a personal loan is a better option if you know exactly how much money you need. A personal loan may also have better rates, depending on your creditworthiness. However, an online personal line of credit is a great option if you are not sure how much money you’ll spend, as you’ll only be charged interest for what you actually spend.
You’ll need to provide plenty of personal information and fill in the application form. Some lenders have a prequalification process, in which they check your credit score with a soft pull. If you’re eligible for a credit line, the lender will send you the final offer. With the best personal lines of credit, you usually receive the money within one business day after signing the contract.
There are many reasons to consider a personal line of credit:
- You have a constant access to funds
- You can draw only what you need
- You pay interest only on the amount you draw from the account
- After you pay off debt, yuo cna start using a line of credit again
- You don’t need to provide a collateral
- You can use money as you wish