How to Get Approved for a Personal Loan

Follow these steps to increase your chances of getting approved for a personal loan. Find out how much money you can borrow and compare personal loan rates.

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Check your credit score

An excellent credit score is one of the most important factors in getting approved for a personal loan. Lenders use your credit score to determine your creditworthiness, which is a measure of how likely you are to repay your loan on time. The higher your credit score, the lower your interest rate will be, and the more likely you are to get approved for a loan. You can check your credit score for free using a variety of online tools.

If your credit score is below 650, you may have difficulty getting approved for a personal loan. If you have a poor credit history, you may want to consider alternative options such as a secured loan or a co-signer.

##Heading: Consider a secured loan
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A secured loan is one that is backed by collateral, such as a car or home equity. The collateral acts as security for the lender in case you can’t repay the loan. Because the lender has less risk, they may be more likely to approve you for a secured loan even if you have bad credit. However, you could lose your collateral if you default on the loan.

##Heading: Find a co-signer
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A co-signer is someone who agrees to sign the loan with you and be equally responsible for repaying it. This can be helpful if you have bad credit because it shows the lender that there is someone else who is willing to take on the risk of loaning you money. Keep in mind that if you default on the loan, not only will it damage your credit, but it will also damage the credit of your co-signer.

Shop around for the best interest rate

The interest rate you’re offered on a personal loan depends on a few things, like your credit score, income and debts. But the lender you choose is also a factor.

That’s why it’s important to shop around for the best interest rate when you’re looking for a personal loan. Here’s how to get started:

First, check your credit score and get an idea of what kind of interest rate you can expect. Then, compare offers from several lenders to see which one has the lowest rate for someone with your credit profile.

Keep in mind that the best interest rate is not always offered by the lender with the lowest fees. Sometimes, a higher interest rate comes with lower fees, so it’s important to compare both when shopping for a personal loan.

Get a co-signer

If you don’t have strong credit, one way to increase your chances of getting approved for a personal loan is to find a co-signer. A co-signer is someone who agrees to take responsibility for the loan if you can’t repay it. Typically, a co-signer will be a friend or family member with good credit who trusts that you will make payments on time.

If you have strong credit but still can’t get approved for a personal loan, consider applying for a secured loan. A secured loan is one that is backed by collateral, such as a savings account, CD, or piece of property. The lender feels more confident lending money if they know they can seize your assets if you default on the loan.

Compare personal loans

You can compare personal loans on sites like Credible by checking the rates and terms you’re offered from different lenders. Keep in mind that the lowest rate isn’t always the best deal — you’ll also want to take into account the loan’s fees, term length, and repayment options.

When you’re ready to apply, Credible makes it easy to compare prequalified rates from multiple lenders with a single application. If you have good credit, you may be able to qualify for a 0% APR personal loan — meaning you won’t have to pay any interest on your loan.

If you have bad credit, you may still be able to qualify for a personal loan with a high interest rate. One option is to apply for a secured loan, which means you would need to put up collateral — like a savings account, CD, or piece of property — in order to get approved.

Read the fine print

Before you sign on the dotted line, be sure to read the fine print carefully. Pay attention to the interest rate, fees, and repayment terms. It’s also important to check the lender’s reputation by reading reviews from other customers.

If you have bad credit, you may not be approved for a personal loan or you may be approved for a loan with less favorable terms. Compare offers from multiple lenders to find the best offer for you.

Be sure to shop around before you decide on a personal loan. Compare offers from multiple lenders to find the best offer for you.