Best Unsecured Personal Loans

Unsecured personal loans are a go-to if you need quick access to funds without putting up collateral. Whether you’re consolidating debt, covering emergency expenses, or financing a major purchase, unsecured loans offer fast funding, large loan amounts, lower interest rates than credit cards, and flexible repayment terms. 

In this guide, we’ll cover what you need to know about unsecured loans, from how they work to how to compare lenders and how to qualify even with bad credit.

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Best unsecured personal loans

What is an unsecured loan?

An unsecured loan is a type of loan that doesn’t require you to pledge any assets as collateral. Most personal loans are unsecured loans. On the other hand, secured loans like auto loans and mortgages use the asset you purchase as collateral for the loan. Since there’s no collateral, lenders rely heavily on your credit score, income, existing debt, and overall financial profile when deciding whether to approve your application.

Once approved, you receive a lump sum of money — typically deposited into your bank account — which you repay in fixed monthly payments over a period of years (the term of the loan). In addition to paying back the amount you borrowed (the principal), you’ll also pay interest on that amount. Unsecured personal loans are commonly used to pay off high-interest debt, like credit cards, to cover emergency expenses, or to finance major purchases.

Related: How Do Personal Loans Work?

Secured vs. unsecured loans

A secured loan has collateral attached to it, which a lender can seize if you default on the loan. The collateral acts as a kind of insurance for the lender against nonpayment, which in turn means you might get a lower rate on a secured loan or be more likely to get approved. However, not only do secured loans increase your risk (you could lose the collateral if you default), but they typically take longer to get since the lender needs to evaluate or appraise the value of your collateral. 

Compare: Secured vs. Unsecured Personal Loans

How to compare unsecured personal loans

Before you compare specific loans and lenders, identify the following: 

Then, find lenders that offer the loan amount you need, will let you use it for your intended loan purpose, and have minimum credit score and income requirements you can meet.

Prequalify and compare quotes

To make this process easier, prequalify with several lenders to narrow down those most likely to approve your application. You can prequalify with several lenders at once on a personal loan marketplace like Credible with no credit impact.

Once you have prequalification quotes, compare them based on:

• Annual percentage rate (APR): A lower APR means a lower overall loan cost. The APR accounts for upfront fees, like origination fees, and the interest rate. APRs range between 7% and 36%, in general, on personal loans. The better your credit, the lower your rate.
• Repayment terms: Lenders typically offer terms between one and seven years, and some lenders offer longer repayment terms than others. With a shorter term, you can save on interest costs (and may even get a lower interest rate), but you’ll have a higher monthly payment. The reverse is true for a longer repayment term.
• Fees: Origination fees and late payment fees are the most common personal loan fees you’ll encounter. If an origination fee is charged, it will reduce the amount you receive (it’s deducted upfront from the loan amount). In other words, you may need to borrow more money to get the amount you need if an origination fee is charged.
• Funding speed: A few lenders like SoFi, LightStream, Rocket Loans, and Santander can fund your loan the same day you apply — if you apply and are approved by the lender’s same-day cutoff time. 
• Customer satisfaction: Check lender ratings and reviews on sites like Trustpilot and the Better Business Bureau (BBB). Consider how lenders fared in customer satisfaction surveys administered by J.D. Power and similar agencies.

How to get an unsecured personal loan

1. Check your credit score: Your score plays a big role in your approval odds, whether you’ll pay an origination fee, and the APR you’ll be offered. It also determines which lenders you should and shouldn’t consider. Check your credit score for free using Credible's credit-monitoring tool.
2. Prequalify and compare lenders: Use a personal loan marketplace to prequalify with several lenders at once and compare quotes from different lenders.
3. Apply: Submit a full application with the lender of your choice and be ready to provide documentation like ID, proof of income, and proof of employment. If applying via Credible, you’ll be redirected to the lender’s website to complete this step.
4. Review the loan agreement: If the lender makes an offer, review the loan agreement to make sure it suits your needs. It may not match the prequalification quote, so look at the APR, loan amount, repayment schedule, monthly payment, whether there’s an origination fee, and other fees the lender charges. 
5. Sign: If all looks good, sign the loan agreement and other documentation required to receive funds.
6. Receive funds: Based on the lender’s funding speed, you should receive the money within a few business days, or as soon as the same day you applied.

Related: How To Get a Personal Loan

How to get an unsecured loan with bad credit

• Add a cosigner or apply for a joint personal loan: The lender considers the financial profile of your cosigner or co-borrower as well as yours in making a lending decision.
• Consider a credit union: Credit unions tend to have lower rates and less stringent eligibility criteria than banks. They may also offer payday alternative loans, which can be a good choice if you need a $2,000 loan or less. 
• Look for bad credit lenders: These lenders either have no minimum credit score requirement or a low one. OneMain Financial and Reprise are a few examples of lenders offering loans for bad credit. 
• Boost your credit score: Correcting credit report errors and becoming an authorized user on the account of someone with good credit can be quick ways to improve your credit score. 

Visit AnnualCreditReport.com to get a free copy of your credit report from each bureau. You can use Credible’s credit-monitoring tool to check your credit score for free.

Requirements for an unsecured loan

When you apply for a loan, you’re not just analyzing lenders — they’ll analyze you, too. Here are some of the things lenders will look at and ask for when they’re reviewing your loan application:

Your credit score and history

This is one of the most important factors a lender considers. Your credit score reflects your financial history, including your payment history, current debts, how much credit you’ve used vs. how much you have available, and how many new applications for credit you’ve made.

A high credit score means that lenders generally consider you a low-risk person to lend to — someone who pays their bills on time, has had accounts in good standing for a long time, doesn’t use too much of their available credit, and hasn’t been opening a flurry of new accounts. Lenders typically offer borrowers with high credit scores the lowest interest rates.

Debt-to-income ratio

Your debt-to-income ratio (DTI) is a simple equation of how much of your monthly income goes to repaying debt. You can calculate it by adding up your minimum monthly payments, then dividing that number by your monthly gross income. A debt-to-income ratio below 36% or less is considered good for a personal loan, though some lenders will accept a higher DTI.

Employment and income

Lenders generally want to know you have an income and a job. They may request pay stubs, bank statements, or tax returns to verify your income. You should have enough income to comfortably make loan payments in addition to the payments you already have.

Related: How To Get a Personal Loan If You're Unemployed

Loan amount

The total dollar amount you’re seeking needs to be in line with what you’re capable of paying back. If lenders don’t think it is, they may deny your application or approve you for a smaller loan amount. Make sure you’re not asking to borrow more money than you really need or are able to pay back.

Learn More: What Are the Requirements for a Personal Loan?

Pros and cons of unsecured loans

Alternatives to unsecured personal loans

If you’d prefer another borrowing option, consider these personal loan alternatives.

• Credit cards: Though credit cards have higher APRs than personal loans on average, a 0% APR credit card is an exception. If you’re able to qualify for a 0% APR card, it can be an excellent way to finance purchases with zero interest over the term of the promotional period. Since that term can range from 12 to 21 months, this is best for short-term borrowing needs. You’ll need to pay off the entire purchase before the promotional period ends and the card’s regular APR takes effect to avoid interest charges.
• Home equity loans/lines of credit: If you own a home with at least 15% equity, you might qualify for a home equity loan or line of credit (HELOC). Rates could be lower compared to a personal loan, and you could borrow a much larger amount and have a longer time to pay it back. Just note that missed payments could put you at risk of losing your home. 
• Friends or family loans: For a potentially lower interest rate, consider borrowing from a friend or a family member, which can also provide them with interest income. To protect your relationship and finances, ensure all terms are written down and seek professional advice for loans above $10,000.

Read More: 9 Personal Loan Alternatives

How can you use a personal loan?

Though you can use a personal loan, in general, for a wide range of purposes, each lender sets limits on what they’ll let you use the money for. For instance, some lenders might only approve debt consolidation loans, while others (like LightStream) might let you use the money for a wide range of expenses. 

Just know that you'll need to use the money for the purpose you're approved for.

The following chart shows the top eight loan purposes by percentage of overall closed loans on the Credible marketplace in October 2025:

Methodology

Credible evaluated 32 lenders across 1,216 data points to find the best unsecured personal loans. We chose the best lenders based on the following weighted categories:

• Rates and fees: 18.75%
• Eligibility and options for bad and no credit: 17.5%
• Availability: 12.5%
• Loan amounts and terms: 10%
• Customer satisfaction: 10%
• Customer service: 10%
• Efficiency and fund delivery: 10%
• Discounts: 7.5%
• Credible proprietary data: 3.75%

Credible’s team of experts gathered information from each lender’s website and from our partners directly. We also considered each of our partner lenders’ statistics over a 12-month period — including average funding times, average credit scores for approved applicants, and average rates. Each data point is verified by a senior editor to make sure it’s accurate at the time of publication. 

Learn more about how Credible rates lenders by exploring our personal loans lender rating methodology.

Disclosure: Some lending partners that participate in Credible’s comparison marketplace offer loans to borrowers with scores as low as 550. Borrowers with low scores will have fewer lending options than borrowers with higher credit scores.