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Best installment loans

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Written by Holly Johnson
Edited by Jana Lynch

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LendingTree, Best Egg, LightStream and Upgrade
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An installment loan is a type of loan that comes with a fixed number of scheduled payments that are spread out over a predetermined length of time. Installment loans give borrowers a lump sum of money upfront to use how they wish.

The fact you get cash in a lump sum separates installment loans from open-ended forms of financing, like credit cards. Another difference is the fact credit cards let you charge purchases in amounts up to your credit limit, and your payments will vary based on how much you borrow.

"When you pay off an installment loan and the balance is brought to $0, you’ve fulfilled your part of the loan obligation and the account is closed," said Andrew Lokenauth, a finance executive who started his career at Goldman Sachs before moving on to teach accounting and finance at the University of San Francisco School of Management.

While the term “installment loan” can technically refer to many types of loans (including most auto and home loans), people often use it as an alternate name for personal loans.


Key insights

  • Installment loans offer you a lump sum upfront, which you pay back with regular payments over a set period of time.
  • Unlike most credit cards and lines of credit, installment loans usually come with fixed interest rates that never change, keeping your payments consistent.
  • Installment loans are available to consumers with almost all credit profiles, including bad credit scores.

Our recommendations for best installment loans

To make our choices for the best installment loans, we collected 806 data points (26 individual data points for 31 lenders), including customer reviews and overall ratings from ConsumerAffairs readers, from popular lenders. We used these data points to evaluate factors that have the most impact on borrowers, including time to funding, annual percentage rates (APRs), loan minimums, repayment terms and credit score requirements, before making our final selections.

Best Egg AUTHORIZED PARTNER
  • Maximum loan amount: $50,000
  • Term lengths: 36 or 60 months
  • Minimum credit score: 600
  • Consumer rating: 4.8

Best Egg’s personal loans come in amounts ranging from $2,000 to $50,000. Annual percentage rates from Best Egg can be as low as 8.99% and as high as 35.99%.

Repayment terms last either 36 or 60 months, and loans can be repaid at any time with no penalty. Like other lenders that made our list, Best Egg also lets you check your rate without a hard inquiry on your credit report.

Our Best Egg profile can help you learn more about this highly-rated lender.

Pros

  • You can check your rate with no impact on your credit.
  • Best Egg says about half of its customers get their money the day after they apply.
  • Lends up to $50,000.

Cons

  • An origination fee of 0.99% to 8.99% is deducted from your loan amount.
  • Best Egg personal loans only come with two repayment term options — 36 or 60 months.
  • Interest rates can be high for borrowers without great credit.

What do reviewers say?

Best Egg has the highest overall rating of any lender on this list from reviewers on ConsumerAffairs at the time of publication. Past customers say the loan process was easy from start to finish, although a few complain about being denied a loan after submitting significant personal information or due to self-employment.


Upgrade AUTHORIZED PARTNER
  • Maximum loan amount: $50,000
  • Term lengths: 24 to 84 months
  • Minimum credit score: 560
  • Consumer rating: 4.8

Upgrade offers personal loans in amounts up to $50,000 with fixed rates and no prepayment penalties. You can check your rate on its website without impacting your credit score, and funding is possible within a day of clearing necessary verifications.

Rates on Upgrade installment loans fall between 7.96% and 35.97% APR, although the lowest advertised rates require you to sign up for automatic payments. You can also tailor your monthly payment by choosing from repayment terms between 24 and 84 months.

Read over our Upgrade profile for more information on this lender, its installment loans and what to expect.

Pros

  • You can check your rate without hurting your credit.
  • Loan amounts up to $50,000 are available for eligible borrowers.
  • Repayment terms go up to 84 months, which can lead to lower monthly payments.

Cons

  • All loans from Upgrade have an origination fee of 1.85% to 8.99%, which is deducted from loan proceeds.
  • Interest rates can be high for borrowers with imperfect credit.

What do reviewers say?

Upgrade's strong rating from reviewers on our site bodes well for the company in terms of customer satisfaction. However, some borrowers did complain about the company's origination fees.


Avant
  • Maximum loan amount: $35,000
  • Term lengths: 12 to 60 months
  • Minimum credit score: 580
  • Consumer rating: 3.9

Avant’s personal loans range from $2,000 to $35,000, and the company lets you check your rate and apply for funding online. Annual percentage rates range from 9.95% to 35.95%, and you can choose to repay your loan over 12 to 60 months.

Like most other institutions offering installment loans, Avant offers fixed monthly payments with interest rates that never change over the life of the loan.

Read our Avant profile for more insights on this lender.

Pros

  • You can check your rate with no impact on your credit.
  • Flexible repayment terms from 12 to 60 months are available.
  • Avant promises loan decisions within minutes and funding as soon as the next business day.
  • Its online portal and mobile app make it easy to track your loan and payments on the go.

Cons

  • Avant charges administration fees of up to 4.75% on all installment loans.
  • With loans capped at $35,000, Avant features a lower maximum loan amount than our other picks.
  • Interest rates can be high for borrowers without good credit.

What do reviewers say?

While some customers rave about a speedy and efficient loan process, others complain about payments posting to their accounts late or not at all.


LightStream AUTHORIZED PARTNER
  • Maximum loan amount: $100,000
  • Term lengths: 24 to 144 months
  • Minimum credit score: 660
  • Consumer rating: 3.9

LightStream is tied with LendingTree for the lowest advertised rates on installment loans across our picks. Its APRs range from 3.99% to 19.99% with autopay, and loans are available in amounts from $5,000 up to $100,000, which is higher than what’s available from many competitors.

Repayment terms depend on your loan type but may last anywhere from 24 to 144 months. Another benefit of LightStream is the fact that its installment loans come with no fees. However, it has strict credit requirements for borrowers.

Our LightStream profile can help you learn more about this lender and how to apply.

Pros

  • LightStream boasts some of the lowest rates of our picks (tied with LendingTree).
  • Provides up to $100,000, which is twice as much as any other lender on this list.
  • Repayment terms may be longer than other lenders, lasting up to 144 months.
  • LightStream does not charge any fees.

Cons

  • According to LightStream, its installment loans are only for borrowers with good or excellent credit.
  • Interest rates are 0.50% higher if you don't use autopay.

What do reviewers say?

Some of the customers who left reviews on ConsumerAffairs are happy with their loan experiences; others complain about lags in posting updated payment information and difficulty qualifying for the lowest rates offered.


Marcus by Goldman Sachs
  • Maximum loan amount: $40,000
  • Term lengths: 36 to 72 months
  • Minimum credit score: 660
  • Consumer rating: 3.9

While Marcus by Goldman Sachs is also known for its online savings accounts and high-yield certificates of deposit (CDs), it offers personal loans in amounts from $3,500 to $40,000.

Loans from Marcus by Goldman Sachs don’t have fees, and its fixed interest rates range from 6.99% to 24.99% APR. You can opt to repay your loan over 36 to 72 months.

Marcus by Goldman Sachs has an online application process, and applicants can check their rates with no impact on their credit.

Read our Marcus by Goldman Sachs profile to learn more about this company's offerings, including its installment loans.

Pros

  • Installment loans come with no fees.
  • Applicants can check their rates and view loan options with no impact on their credit scores.
  • You can qualify for a one-month payment deferral after making 12 consecutive on-time payments.

Cons

  • The highest loan amount from Marcus by Goldman Sachs ($40,000) is lower than most of our other picks offer.
  • It recommends a credit score of 660 or higher for approval.

What do reviewers say?

While some people who left reviews on our site praised the company, others felt that there was a lack of communication and mishandling of their loan applications.


LendingTree AUTHORIZED PARTNER
  • Maximum loan amount: $50,000
  • Term lengths: Varies
  • Minimum credit score: Varies
  • Consumer rating: 4.0

LendingTree is a marketplace, not a lender. This means it helps you compare different loan options from a range of financial institutions.

Because of this, interest rates, fees and loan terms offered through LendingTree vary. That said, LendingTree claims its partner lenders offer personal loans in amounts from $1,000 to $50,000 and with rates as low as 3.99% APR.

Our LendingTree profile can help you learn more about this marketplace and how it works.

Pros

  • Soft credit check available.
  • Can compare loan offers across multiple lenders in one place.
  • Loan amounts start at $1,000, and rates can be as low as 3.99% for qualified borrowers.

Cons

  • Loan rates, terms and fees vary by lender.
  • Approval requirements also vary by lender.

What do reviewers say?

Some reviews left by customers on our site state that LendingTree offers great communication and provides smooth transactions, while others felt that the sales tactics were too aggressive.


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    How to get an installment loan

    While the process can vary from lender to lender, the typical installment loan application requires you to submit information like your name, contact info, income and reason for borrowing. From there, you may be able to check your rate by submitting the last four digits of your Social Security number, or you may be asked to supply your full SSN to move forward with the process.

    Lenders are often able to approve applicants based on the information provided in their applications, but they might also ask for additional information, such as a copy of their driver's licenses, pay stubs or other proof of income. Either way, approved applicants may be able to get their funds as soon as the same day.

    Lokenauth, the finance executive we interviewed, told us that, no matter what, it's always smart to shop around and compare loan offers across multiple lenders before you take steps to apply. Specifically, he said you should compare monthly payments and APRs between lenders. "APR measures the amount of interest you pay to borrow on credit and lending accounts," said Lokenauth. "The higher the APR, the higher you pay in interest."

    In the meantime, he said that you should avoid borrowing "more than you need or can't pay back." Also, always take your time and read the fine print before you sign your name on any contract.

    Frequently asked questions

    Is a personal loan the same as an installment loan?

    Technically, personal loans are a type of installment loan. So, all personal loans are installment loans, but not all installment loans are personal loans.

    However, in the real world, these terms are often used interchangeably to describe generic loans that offer a medium-sized lump sum in return for fixed monthly payments on a stable repayment schedule. That’s why you may see some products marketed as both personal loans and installment loans.

    Can I get an installment loan with bad credit?

    Some lenders offer installment loans to consumers with low credit scores. However, borrowing with bad credit can be more expensive than borrowing when you have a strong credit history.

    Do installment loans affect your credit score?

    Applying for an installment loan can result in a hard inquiry on your credit report, which can temporarily ding your score. However, Lokenauth explained that an installment loan could help increase your credit score when paid back on time.

    "Future potential lenders will see that you have a solid repayment history and that you are reliable," he said.

    Are installment loans a good idea?

    An installment loan may or may not be a good idea, depending on your goals and what you need the money for. That said, these loans are popular for debt consolidation, home improvements, and other large expenditures that can take several years to complete or pay for.

    Bottom line

    The best installment loans let you access cash now, then pay off your balance with a fixed interest rate over several years. With that in mind, these loans can work well for any number of financial goals (provided you can afford the monthly payments).

    That said, many experts caution against borrowing without a plan or for things you don't really need.

    "Debt can rob you of your future because you are using the money you earn today to pay off things from the past," Lokenauth said. "You need to be honest with yourself and realistic in order to stay on track with your debt payoff goals, and to stay motivated."

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