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How to get approved for a personal loan

How long it takes depends on a variety of factors

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It can take anywhere from a day to a week to apply for and get a personal loan. However, the time it takes to receive a personal loan varies based on factors such as the lender you choose, your credit score and how accurately you complete the application.

Generally, you can get a personal loan faster if you have a high credit score and earn enough income to repay the loan easily. You can also speed up the time it takes to get a personal loan by accurately completing your application and promptly providing your lender with any required documents (e.g., pay stubs).

Your personal loan might also be approved and funded faster if your lender allows you to apply online. Plus, if the loan is with your existing bank or credit union, the funds could be deposited into your bank account as soon as the day you apply.


Key insights:

  • While you may be able to get your personal loan approved and funded as soon as the same day, funding could take up to a week.
  • To apply for a personal loan, you’ll need to provide personally identifiable information (e.g., your taxpayer identification number) and details about your existing debt and income.
  • You can get a personal loan faster by applying online, ensuring your application is complete and quickly providing your lender with any required documentation.

What is a personal loan?

A personal loan provides consumers with money they can use for virtually any purpose, which is paid back in fixed monthly payments. Personal loans are usually unsecured, meaning your lender won’t ask you to offer any collateral (e.g., vehicle, home).

Personal loan companies lend as little as $250 and as much as $100,000, with repayment terms ranging from six to 84 months.

Where can you get a personal loan?

You can get a personal loan from many finance companies, such as banks, credit unions and online lenders.

  • Banks: Most banks offer personal loans, and funding may be as quick as the same day. While major banks often allow you to apply online, smaller community banks may require an in-person application. Larger or more complicated loans are often manually reviewed by banks. So, funding could take several days or up to a week.
  • Credit unions: The main purpose of credit unions is to offer readily accessible banking and financing solutions, like personal loans, to consumers. As with banks, while you may be able to get funding on the same day, it could take a few business days or up to a week if you need to apply in person or your loan is manually reviewed.
  • Alternative online lenders: Many financial technology (fintech) lenders offer online personal loans with funding as quickly as the same day. This type of lender focuses on providing fast money, so the application process is usually quick and simple. If your loan doesn’t fit the automatic approval criteria, funding could take a day or two longer.

While you can potentially get same-day personal loan funding from payday lenders and auto title loan companies, do your best to avoid these loans because they usually carry extremely high interest rates and fees. Consumers who get personal loans from these types of lenders often get stuck in a cycle of borrowing that’s difficult to escape.

To avoid getting caught in a debt trap, exhaust all other funding options before considering a payday or title loan. For example, you might borrow money from family and friends, seek help from a local nonprofit or even take on a second job. Additionally, you might consider getting a lower-cost payday alternative loan (PAL) from a credit union.

What do you need to apply for a personal loan?

You’ll need to provide personally identifiable information and details about your debt and income when applying for a personal loan. Some of the most common things you’ll need to include with your loan application are your:

  • Name
  • Taxpayer identification number (e.g., Social Security number)
  • Phone number
  • Home and mailing address
  • Government-issued photo identification
  • Job history (e.g., employer names, job start dates)
  • Gross monthly income
  • Proof of income (e.g., pay stubs, tax returns)

When you apply for a loan, take the time to accurately and thoroughly fill out the application. If there are errors or you forget to provide some information, it may take your lender longer to process your application or your loan application might even be declined.

How can you get a personal loan faster?

One of the easiest things you can do to get a personal loan faster is to have all the necessary documents on hand before you start working on the application. After you’ve gathered all the information you’ll need, carefully ensuring your application is accurate will help speed up the process.

“We often see decision delays because we need additional information,” said Matt Lattman, vice president of personal loans for Discover. “Gathering all of your documents can speed up the application process. One of the biggest factors in receiving a decision quickly is if the application is complete.”

Another thing you can do to increase your odds of getting approved quickly for a personal loan, according to Lattman, is to “do your homework before you apply.” Doing your homework on a personal loan could include such things as:

  • Checking your credit score and resolving any issues: An easy thing to do before you apply for a personal loan is to check your credit score. You’re entitled to a free credit report every year from each of the three credit bureaus, which you can request from AnnualCreditReport.com. This allows you to know where your credit stands and resolve any issues before applying for a personal loan.
  • Searching for a lender offering the loan amount and terms you want: Every lender offers different personal loan options. By ensuring you can get the amount of money and repayment term you need, you can avoid going through the process only to find out the lender doesn’t offer the right financing.
  • Applying online to get pre-qualified: Many lenders will pre-qualify you for a personal loan without any impact on your credit score. After you apply online, the lenders will let you know if you’re pre-qualified and what rates and terms are available.

Ultimately, the best way to get a personal loan faster is to do everything in your power to make your lender’s job easier. This includes applying for a loan that fits your needs, ensuring your application is accurate and complete, providing all the required documentation upfront and quickly responding to your lender’s requests.

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    FAQ

    How does a personal loan affect my credit?

    When you get a personal loan, your credit score may decrease slightly because of a hard credit inquiry from the lender. Your credit score is likely to improve if the personal loan replaces revolving debt (lowering your credit utilization ratio) and you make your payments on time. Conversely, your credit score might worsen if you make your loan payments late.

    What credit score do I need to get a personal loan?

    While each lender has a different credit score requirement, you’ll generally need a score of at least 580 to 660 to qualify for a personal loan. Many lenders share their minimum credit score requirements upfront, so you know if you’re eligible before applying. You can also usually see if you qualify with no credit score impact, as many lenders use a soft credit check to pre-qualify you.

    Does a personal loan come with fees?

    Some lenders charge fees for their personal loans, such as origination fees, application fees, prepayment penalties and late fees. Origination and application fees are charged upfront to process your loan, whereas prepayment penalties and late fees are only charged if you repay the loan early or make a late payment.

    You can compare personal loan costs by evaluating the annual percentage rate (APR), which includes the interest rate and any required fees, such as origination and application fees.

    Bottom line

    You may be able to get a personal loan approved and funded as soon as the day you apply, but funding could take up to a week. The funding speed largely depends on the lender you choose, your qualifications, the accuracy of your application and how quickly you provide the lender with any required documentation.

    Lenders with a simple online application and automated approval process generally offer the quickest funding speeds; these include mainly online lenders, but some banks and credit unions also provide same-day funding to their existing customers. The biggest factors you can control are how quickly and accurately you fill out the application and respond to your lender’s requests for information.

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