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Best Unsecured Loans
Lower risk, speedy payouts, and a simpler application process are all upsides of getting an unsecured personal loan. Of course, as is the case with almost anything in life, there’s an array of options to choose from, and it’s up to you to find the one tailored to your needs. Fortunately for you, the legwork has already been done, and we’ve selected the leading offers on the market today.
Best Unsecured Loans in December 2024
LightStream
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
From low APRs to high loan amounts – there’s not much to dislike with LightStream. If you have strong credit, you’ll have no trouble getting an excellent deal on unsecured loans for financing pretty much anything you could think of. Read more
- •Competitive rates
- •Same-day funding
- •No origination fees
Prosper
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
Prosper is a well-known peer-to-peer lender boasting $17 billion in funded loans. These loans are fully amortized and include no early-payoff penalties. To top things off, Prosper specializes in joint loans, which grant borrowers the opportunity to get the lowest rates possible. Read more
- •Lenient eligibility criteria
- •Fast application process
- •A variety of loan types
Avant
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
Avant is another loan marketplace that's been on the rise in the past years. With its reputable lenders and experienced staff, it’s not hard to see how it got to be a legitimate challenger on the market. If you’re on the hunt for unsecured loans, then this Illinois-based company should definitely be on your radar. Read more
- •Easy-to-use mobile app
- •Credit reporting
- •SCRA benefits
Happy Money
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
Happy Money specializes in loans for consolidating credit card debt. Although it’s a shame that its affordable loans can’t be used for a wider variety of purposes, it’s indisputable that Happy Money has one of the better offers on the market today. Read more
- •Low DTI requirement
- •Commitment-free soft credit check
- •Member experience team
Top Unsecured Loans - Our Picks for 2024:
- LightStream - Best for large low interest personal loans
- Prosper - Best for borrowers that want a joint personal loan
- Avant - Best for unsecured loans for bad credit
- Happy Money - Best for paying off credit card debt
Our Methodology for Evaluating Unsecured Loans
With thousands of lenders out there, how can you know that you’ve chosen the right one? Sometimes their offers can seem too good to be true - because they usually are.
By sharing our methodology, we hope to provide you with a useful checklist for reviewing the offers you find online.
Loan Terms
Loan terms are the first thing you should look at. This involves examining the loan rates, repayment periods, and any fees that you may be charged.
An APR will give you a better idea of what your loan will cost than the interest rate. This is because an APR reflects both the interest rate and the fees associated with borrowing the money. Understandably, you want this number to be as low as possible.
According to Bankrate's study from November 2024, the average personal loan interest rate is 12.31%. Unsecured loans usually come with slightly higher rates as they don’t rely on collateral.
One of our main concerns was pinpointing lenders with a variety of loan repayment times. The reason behind this is that there's no perfect time span for everyone. Shorter repayment length will entitle you to a lower interest rate, but the monthly payments might be too high for you to handle, so being able to give yourself a couple more months is of paramount importance.
Lastly, in our book, the best offers are those that don’t include too many additional charges. A few fees here and there are to be expected, but they should never be unrealistically high or hidden.
Loan Requirements
To qualify for a loan, you need to meet certain requirements: Their purpose is to ensure you’ll be able to pay back your loan. Therefore, expect your potential lenders to look at your credit score, credit history, and annual income. Aside from these criteria, you will almost certainly have to be 18 or over and a US resident.
Although you might feel like some of these requirements are too strict, they are necessary, especially when it comes to unsecured personal loans as there is no collateral.
Luckily, we will tell you exactly what the companies we’ve listed wish to see on their applicants’ loan requests.
Application Process
No one likes dealing with paperwork, so the faster and easier you can get it all over and done with, the better. Obtaining a loan is already stressful enough - you don’t want an overly complicated application process making it worse.
In this day and age, you can avoid the whole ordeal of going down to a brick-and-mortar lender, too, since there are plenty of lending websites that let you fill out all the necessary paperwork online.
Unique Features
If the unsecured loans you’re considering come with any unique benefits or restrictions, you want to know about it. Does the lender allow you to use the loan for general or only specific purposes? Are there any discounts? Sometimes it’s these small details that tip the scales in favor of a particular lender.
Customer Service
Finally, although customer service may not be as important as lending conditions, repayment times, and other above-mentioned features, it’s still worth looking into.
You never know when you might need additional information on any loan-related subject: Being able to get in touch with your lender easily can impact your entire lending experience.
The leading companies will often have reasonably long working hours and both email and phone support, with knowledgeable and patient support agents. Good educational tools and a quality help center can also be very valuable for quickly finding the answers you need.
Detailed Reviews of Unsecured Loans
LightStream
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
LightStream is a division of Truist, which was formed when two highly successful bank holding companies (BB&T and SunTrust Banks) merged. With that in mind, it’s no surprise that LightStream is among the industry leaders in providing personal loans.
Loan Terms
The lowest 5.95% APR is only available with AutoPay; without AutoPay the rates are 0.50% points higher. However, even the slightly steeper APRs are still very affordable. As is usually the case, the lowest interest rates are only accessible to borrowers with good and excellent credit.
Another commendable aspect of LightStream loans is that they’re completely free of fees, without even a prepayment penalty!
But that’s not all that this lender has to offer. You can borrow up to $100,000 and choose a comfortable repayment period, anywhere between 24 and 84 months.
Requirements
LightStream’s eligibility requirements are generally reasonable, but they could be strict for some. To get a loan, you’ll need to supply several years of credit history, with multiple account types (e.g. credit cards and car loans). Although there’s no specified credit score condition, a solid rating of around 660 is preferred.
Those that want to obtain LightStream’s loans will also need to have nearly spotless credit reports and be earning enough to manage any existing debts.
Application Process
If you apply for a loan during LightStream’s working hours, you’ll be presented with your options within a very short time. In fact, you could receive your funds the very same day, should you find the time to go over and e-sign your loan agreement, as well as forward all relevant information to the company by 2:30 PM during banking business days.
Unique Features
LightStream has a superb yet uncommon business policy: if you feel like you haven’t had the best personal loan experience, you’ll receive $100. This guarantee is valid for 30 days after you receive your loan.
Let’s not forget to mention that you can use your loan for financing home improvements, weddings, timeshares, and various other purposes.
Customer Service
Potential and active borrowers can find an extensive FAQ page on LightStream’s website, but if there’s anything that they are unable to find, they can contact the customer care team via email Monday through Friday from 9 AM to 8 PM and on Saturdays from 12 PM to 4 PM EST.
Though they have business hours on Saturday, LightStream doesn’t offer phone support on the weekend.
Prosper
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
Ever since Prosper was launched in 2005, it has maintained a reputation for helping its customers acquire fast and easy personal loans. And this P2P marketplace must be doing a good job too, seeing as how more than a million borrowers have chosen it as their go-to place.
Loan Terms
APRs for Prosper’s unsecured loans currently range from 7.95% to 35.99%. There are several fees you should know about before committing to one of them, though: the origination fee of 2.41% – 5%, the $15 insufficient funds fee, and a late fee (for loan payments that are 15 or more days late) that can be either 5% of the unpaid amount or $15 (whichever is greater).
Out of all the providers we selected for our list, Prosper has the fewest loan length options available: either three or five years. However, it will let you borrow as little as $2,000.
Requirements
What truly puts Prosper ahead of the competition is its fairly lenient eligibility criteria. To apply for a loan, you just have to have an income; there’s no minimum, and your debt-to-income ratio can’t exceed 50%.
In addition to that, you’ll also need a credit score of at least 640, less than 5 credit inquiries within the last 6 months, at least 3 open trades, and 0 bankruptcies within the last 12 months.
Due to these relatively loose conditions, many consider Prosper to be the go-to-place for for borrowers with poor credit, and we can’t help but agree.
Application Process
Submitting a loan application through Prosper is as easy as ABC and completing the process takes just a couple of minutes. The interface is very user-friendly and even the not-so-tech-savvy clients should have no trouble with it.
Unique Features
Prosper allows you to take out a joint loan. This is a perk you should seriously consider because a co-signer with good credit can increase your chances of approval and get you better loan terms.
Prosper offers a vast variety of loan types. If you’re in the market for small business funding, engagement ring financing, or just need a few extra dollars to go green, then this service is perfect for you.
Customer Service
Prosper has both email and phone support, but neither is available during weekends. If you have any questions you’d like to ask the customer care team, you’ll need to do it between 8 AM and 6 AM EST from Monday to Friday. Before you contact them, you might want to explore Prosper’s extensive help center and informative blog section first.
Avant
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
Avant is a relatively new company that provides unsecured loans from WebBank – an FDIC-insured, state-chartered industrial bank. Its near-constantly available customer support, low credit score requirement and flexible repayment options have earned it a 4.7 score on Trustpilot.
Loan Terms
This company’s APRs are slightly higher than average, but they’re far from unmanageable. Borrowers that aren't certain that they’ll be able to make their upcoming loan payment can even call customer support and change their due date.
Avant’s loan lengths are fair and the amounts are standard compared to other lenders and lending platforms. The company is quite transparent when it comes to its business operations, so as its customer, you’ll be duly notified about its three fees.
You’ll be charged up to 4.75% for the administration fee, $25 for loan payments late more than 10 days, and $15 for unsuccessful payments.
Requirements
With Avant, you won’t have to worry about your eligibility. Although Avant doesn’t publicly disclose its credit score or minimum income requirements, an estimated credit score of around 580 and a gross annual income of at least $20,000 should be enough to get you started.
Application Process
You’ll usually receive funds the following business day after approval. To get approved, you’ll need to complete the application and verification process, which fortunately won’t take up much of your time.
Unique Features
Avant is chock-full of unique features and we’re not just talking about the numerous loan types it extends to its customers. First of all, you can download the Avant app from both Google Play and App Store, which allows you to control your personal loan account on the go.
As a result of Avant’s diligent credit reporting to all three credit bureaus (Equifax, Experian, and TransUnion), your timely payments will be rewarded with a credit score boost.
The last feature we feel compelled to introduce you to is the opportunity to apply for SCRA benefits. The SCRA (Servicemembers Civil Relief Act) provides lending protection for military personnel who are called to active duty.
These clients are eligible for loan interest rates that don’t exceed 6% and won’t be charged any late or non-sufficient funds fees during active service.
Customer Service
If Avant’s offer seems tempting to you, you’ll be happy to know that you can find out any additional details about them by calling or emailing the customer support agents available every day of the week. They can be reached Monday–Friday from 7:00 AM to 10:00 PM Central and Saturday–Sunday from 7:00 AM to 8:00 PM Central.
You can also find plenty of tips and instructions on Avant’s blog and FAQ page. Both are well-organized and contain easy-to-understand content.
Happy Money
Fortunly's Rating: Our editorial team determines the rating based on a set of evaluation criteria developed for each product and service category.
Happy Money is a financial services company founded in 2009. It presents a safe platform for borrowers and lenders to connect.
Loan Terms
Payoff by Happy Money loans are quite budget-friendly overall. The only fee that you should be aware of is the one-time origination fee, ranging between 0% and 5%.
The maximum loan amount is $40,000, which is less than what LightStream offers but is still pretty decent. The repayment period is quite generous as well, between 2 and 5 years.
Requirements
Firstly, you need to have a FICO score of 640. Secondly, there shouldn't be any delinquencies on your credit reports, since lenders want to see that you’re financially responsible.
Aside from these two main conditions, your debt-to-income ratio, credit history, previous and current lines of debt, and credit utilization rate will be examined. For the best deal, you will usually need a DTI that's below 36%, but, according to our research, Happy Money is likely to consider you as long as your DTI is under 50%.
Application Process
Happy Money will do a soft check, which won’t affect your credit score. If you’re satisfied with the terms offered to you, there are just a few more easy steps to complete and get your loan.
Unique Features
Happy Money members are rewarded with free FICO score updates, which you’ll definitely be happy to receive. Happy Money members who repaid at least $5,000 in credit card balances witnessed their credit score go up by approximately 40 points within four months.
Another noteworthy thing about this company is that it has a member experience team dedicated to making your first year as a Happy Money client as pleasant as possible.
Customer Service
Friendly customer care representatives are on stand-by, Monday through Friday from 6 a.m. to 6 p.m. and Saturday and Sunday from 6 a.m. to 3 p.m. (PST), ready to answer all your questions. You can use the phone, email, or live chat – whichever suits you the most.
It may not be the most comprehensive one you’ll have come across, but a decent amount of information is available on the Support page as well.
Key Things You Need to Know About Unsecured Loans
An unsecured personal loan, as opposed to a secured personal loan, provides borrowers with the opportunity to take out a loan without having to provide collateral. Whether you should acquire this type of personal loan depends solely on your financial circumstances.
However, to help you better understand them and perhaps assist you in making a decision, we’ll go over their advantages and disadvantages.
The Pros
The major advantages of unsecured loans include:
No Risk to Personal Property
The main reason people of all financial means choose to get an unsecured loan is because there is no risk to their personal property. Many in need of a loan are hesitant to get one for fear of having their home, car, or any other valuable asset taken away.
Unfortunately, if they happen to lose their income and consequently aren’t able to make their monthly payments, the odds of that happening with a secured loan are very high.
Simple Application Process
Since you aren’t required to submit as many documents as you would be if you were applying for a secured personal loan, the turnaround time on applications tends to be a lot faster and simpler.
Good Loan Terms
Borrowers with good or excellent credit scores can qualify for rates rivaling those for secured loans. Keep in mind that credit score ranges differ depending on the credit score model, so you should make sure to check your potential lender’s loan application requirements.
The Cons
Some possible disadvantages of unsecured loans are:
Risky for Lenders
A loan without collateral entails more risk for lenders. In order to ensure that they’ll make a profit, they’ll usually offer higher rates and smaller loan amounts.
As we’ve already mentioned, borrowers with exemplary credit scores will most often be able to find perfectly reasonable loan conditions, but those with poor or bad credit might have to settle for less favorable ones.
Court Action
If you fail to repay your loan within the agreed-upon time period, a lender may take legal action against you. This happens in worst-case scenarios but you should try and avoid them at all costs. After all, the last thing you need in such a situation is to worry about attorney fees and court costs.
Lenders aren’t interested in long costly trials either, so you should always try to negotiate with them. The leading lenders will most likely be willing to extend your loan repayment term or create a repayment plan for you.
Some plans involve pausing your monthly payments or letting you pay back your debt with reduced or no interest. If you are unable to come to an agreement with your lender, you might want to think about asking your friends and family for help.
Main Takeaways
No loan is risk-free but that doesn’t mean that they are something to fear. It’s true that even the best offers have their downsides, but if you’ve done the necessary prep, like evaluating your finances and determining which loan terms you’d be able to handle, you shouldn’t have any trouble managing your payments, barring unforeseen circumstances.
FAQ
What is the highest unsecured loan I can get?
The highest unsecured loan you’ll be able to get is usually $40,000 or $50,000, with a few lenders such as LightStream offering up to $100,000. Of course, to qualify for the highest amounts, you’ll have to present your lender with an exceptional credit score.
What is a good APR for an unsecured loan?
APRs ranging between 6% and 36% are usually considered good for an unsecured loan.