By Holly Johnson
As of Monday, June 01, 2020
Installment loans are financial products that let you borrow a fixed sum of money, then pay it back slowly over time. These loans, which include personal loans, also come with the benefit of fixed interest rates and fixed monthly payments, so you always know how much you owe each month and when your final payment will be due.
Where credit card interest rates tend to be high, installment loans extend much lower rates to consumers with good or excellent credit. This guide can help you compare the best online installment loans.
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When shopping for an installment loan, compare APRs across multiple lenders to make sure that you’re getting a competitive rate. Also look for lenders that keep fees to a minimum and offer repayment terms that fit your needs. Loan details presented here are current as of the publish date, but you should check the lenders’ websites for more current information. The installment loan lenders listed here are selected based on factors such as APR, loan amounts, fees, credit requirements and other factors.
| Lender |
Best for
|
Est. APR
|
Min credit score
|
Loan term
|
Loan amount
|
|---|---|---|---|---|---|
| Marcus by Goldman Sachs |
Good credit
|
6.99% - 28.99%
|
660
|
3 - 6 years
|
$3,500 - $40,000
|
| LendingClub |
Peer-to-peer lending
|
6.95% - 35.89%
|
600
|
3 or 5 years
|
$1,000 - $40,000
|
| Upstart |
Fair credit
|
6.53% - 35.99%
|
620
|
3 or 5 years
|
%5,000 - $50,000
|
| LightStream |
Large loan amounts
|
3.49% - 16.79%
|
660
|
2 - 12 years
|
$5,000 - $100,000
|
| Payoff |
Debt consolidation
|
5.99% - 24.99%
|
640
|
2 - 5 years
|
$5,000 - $35,000
|
| SoFi |
Unemployment protection
|
5.99% - 18.82%
|
680
|
2 - 7 years
|
$5,000 - $100,000
|
| Avant |
Bad credit
|
9.95% - 35.99%
|
580
|
2 - 5 years
|
$2,000 - $35,000
|
Unlike credit cards, which offer a line of credit you can borrow against, installment loans give you a fixed sum of money upfront. You’ll have a fixed interest rate and a fixed monthly payment, which means you’ll know exactly when your loan will be paid off.
For example, if you were to borrow $20,000 with an 8.99 percent APR and a 60-month repayment timeline, you would pay $415 per month for five years.
You can typically use installment loans for any purpose, but many people use them for debt consolidation, home remodeling projects or emergency expenses.
Before you apply for an installment loan, there are a few steps you should take. Consider these moves before you borrow money that might take several years to pay back.
Overview: Marcus by Goldman Sachs offers installment loans with competitive interest rates and no fees. You can borrow up to $40,000 with a fixed interest rate and fixed repayment timeline, making it easy to budget for your loan payments over time. Marcus by Goldman Sachs also earned the top ranking in J.D. Power’s 2019 U.S. personal loan satisfaction study, so it's likely that you'll receive top-notch customer service.
Perks: Interest rates are low for consumers with good or excellent credit, and you can even secure a 0.25 percent rate discount when you sign up for autopay. There are also no sign-up, prepayment or miscellaneous fees.
What to watch out for: You’ll need a credit score of at least 660 to qualify, so this lender won’t work for everyone.
Read Bankrate's expert Marcus by Goldman Sachs Review
Overview: LendingClub is a peer-to-peer lender, meaning you receive your loan funds from individual investors instead of a traditional bank. You can borrow money for nearly any reason, ranging from debt consolidation to home improvement projects, and interest rates can be competitive depending on your interest rate, starting at just 6.95 percent.
Perks: LendingClub makes it easy to get prequalified online and without a hard inquiry on your credit report. Like all installment loans, you also qualify for a fixed interest rate, a fixed monthly payment and an exact date when your loan will be paid off.
What to watch out for: LendingClub installment loans can come with an origination fee of up to 6 percent of your loan amount.
Read Bankrate's expert LendingClub Review
Overview: Upstart is an online installment loan lender that offers competitive loan products to borrowers with good or even fair credit. You can apply for your loan online and get your money as soon as the next business day. While Upstart isn’t necessarily a household name among lenders, this lender secured the third spot out of 14 ranked providers in J.D. Power’s personal loan satisfaction study.
Perks: Upstart looks at more than your credit score when approving you for a personal loan. It also considers your education, area of study and job history.
What to watch out for: Upstart’s interest rates can be on the high side for consumers with imperfect credit, with rates capping at 35.99 percent. Also watch out for origination fees as high as 8 percent of your loan amount.
Read Bankrate's expert Upstart Review
Overview: LightStream offers installment loan amounts up to $100,000, as well as some of the lowest interest rates for consumers with excellent credit. You can also apply online and have access to your funds within the same day. Due to its strong customer service, this lender secured the No. 2 spot out of 16 lenders profiled in J.D. Power’s personal loan satisfaction study.
Perks: LightStream offers a discount on your APR when you sign up for autopay, and you can borrow considerably more with this lender than you can with some competitors — up to $100,000. These loans also come with no fees.
What to watch out for: While LightStream doesn't list specific eligibility requirements, it does mention that LightStream borrowers typically have several years of credit history with a variety of accounts, such as credit cards, auto loans and mortgages. If you don't fit this profile, LightStream may not be the best fit.
Read Bankrate's expert Lightstream Review
Overview: Payoff is an online lender that gears its installment loans to consumers who need to consolidate high-interest credit card debt. Interest rates start at just 5.99 percent, and these loans don’t come with common fees like prepayment fees, application fees or even late fees.
Perks: Because Payoff offers loans solely for credit card debt consolidation, borrowers can focus on repaying existing debt and boosting their credit score.
What to watch out for: Payoff installment loans can charge an origination fee of up to 5 percent of your loan amount. Payoff is also not the right choice for anyone looking to use a loan for anything other than credit card debt consolidation.
Read Bankrate's expert Payoff Review
Overview: While SoFi is mostly known for its popular student loan refinancing products, it also offers installment loans with long repayment timelines. SoFi installment loans also come with unemployment protection that allows you to temporarily pause your monthly payments in the event that you lose your job.
Perks: SoFi installment loans don’t charge any obvious fees or hidden fees, and you may be able to borrow up to $100,000 depending on your income and other factors.
What to watch out for: These loans are geared toward consumers with good credit, so you’ll need to have a credit score of at least 680 to get approved.
Read Bankrate's expert SoFi Review
Overview: Avant focuses on installment loans for consumers with fair and poor credit, so it may be a good option if your score falls in this range. Interest rates start at 9.95 percent APR, so it’s possible to get a reasonable rate and save money on debt consolidation or any other loan purpose.
Perks: Avant lets you get prequalified online without a hard inquiry on your credit score. It also serves a wider range of credit scores than many other lenders, claiming that most of its customers fall in the 600-to-700 range.
What to watch out for: Watch out for administration fees, late fees and dishonored payment fees. Interest rates can also be high for consumers with the lowest credit scores, peaking at 35.99 percent.
Read Bankrate's expert Avant Review
Installment loans for bad credit do exist, but you’ll need to shop around and compare several options, since every lender has different eligibility requirements. With poor credit, you can also expect your installment loan to have a higher interest rate and more loan fees.
The installment loans we profiled here are unsecured, meaning you don’t have to put down any collateral to qualify. With that being said, secured loans that require collateral are also available and may be your best option if you have poor credit.
Installment loans are popular for debt consolidation due to the fact that they tend to offer lower interest rates than credit cards. For example, if you have multiple lines of credit card debt at an 18 percent APR, you can save money by transferring that debt to an installment loan at a 9 percent APR. That way, you pay less in interest and can focus on paying one fixed bill instead of several.