Best Personal Loans With No Origination Fees

A personal loan can help you consolidate your debts, cover an emergency or even pay for something fun like a wedding. But origination fees can eat into the final amount you receive, since they are usually deducted from the loan money.

Fortunately, you can find personal loans with no origination fees, keeping more money in your pocket for whatever you need. Read on to learn more.

MoneyLion offers a service to help you find personal loan offers. Based on the information you provide, you can get matched with offers for up to $100,000 from our top providers. You can compare rates, terms, and fees from different lenders and choose the best offer for you.

Best for Borrowers With Excellent Credit: LightStream

If you have a good-to-excellent credit profile, you may qualify for a personal loan with no origination fee and a low interest rate from LightStream.

The best-qualified borrowers can snag an interest rate as low as 6.24%, and rates go as high as 25.89%. However, these loans also come with an autopay discount, which amounts to 0.50% off your interest rate.

Loan terms range from 24 to 240 months, and there are no fees associated with the loan. If you can pay it off before the term ends, you won't pay any prepayment penalties and might save significantly on interest costs.

You can apply online, and if accepted, you may receive money deposited into your bank account on the same business day.

But one downside of LightStream is that you cannot change the due date or add autopay for the rate discount after your loan has been funded.

• Loan amount:

  $5,000 to $100,000

• Interest rate:

  6.249% to 24.89% after discount

• Loan terms:

  24 to 240 months, depending on use

• Minimum credit score:

  Not disclosed

• Time to fund:

  As soon as the same business day

Best Overall: SoFi®

SoFi is an online financial services provider and bank offering high-interest savings accounts, credit cards, insurance, loans and much more. With SoFi, you can borrow money for home improvement projects, debt consolidation, family planning, travel, weddings or virtually any other need.

Loan amounts vary from $5,000 to $100,000, with terms ranging from two to seven years. If approved, funds are often available the same day you sign the loan. There are no loan origination fees, prepayment penalties or late fees, either.

Fixed rates range from 8.74% to 35.49% APR with all discounts. The average median interest rate is 14.83% on a SoFi personal loan with a five-year term, according to the website.

• Loan amount:

  $5,000 to $100,000

• Interest rate:

  8.74% to 35.49% with discounts

• Loan terms:

  2 to 7 years

• Minimum credit score:

  Not disclosed

• Time to fund:

  As soon as the same day

Best for Smaller Loan Amounts: Discover

Discover®, Member FDIC, loans are available for $2,500 up to $40,000, with interest rates from 7.99% to 24.99%. You'll need exceptional credit and a short loan term to qualify for the lowest rate. Discover offers personal loans with no origination fees and no closing costs for the loan. You should be aware that you might be subject to late fees, however, if you miss a payment or pay late.

You can choose loan terms from 36 to 84 months. Many borrowers who qualify receive a decision the same day and can have funds deposited into their bank account as soon as they accept the terms.

• Loan amount:

  $2,500 to $40,000

• Interest rate:

  7.99% to 24.99%

• Loan terms:

  36 to 84 months

• Minimum credit score:

  Not disclosed

• Time to fund:

  As soon as the same day

Credit Union Option: PenFed

Credit unions often offer low interest rates on personal loans to their members. PenFed Credit Union is one of the few credit unions providing loans with no origination fees. There's also no prepayment penalty and no hidden costs. Loan terms can extend to 60 months, and you can borrow as much as $50,000.

Typically, funds will be deposited into your account within one to two business days after approval.

Unlike many credit unions, which have membership requirements, PenFed is available to anyone in the U.S. with a Social Security number or Tax ID number. You'll need an initial deposit of $5 to open a PenFed account, which will qualify you to apply for a personal loan as a member of the credit union.

• Loan amount:

  $600 to $50,000

• Interest rate:

  6.74% to 17.99%

• Loan terms:

  Up to 60 months

• Minimum credit score:

  Not disclosed

• Time to fund:

  As soon as the next day

How To Choose a Personal Loan

Finding personal loans with no origination fees can put more cash in your pocket to pay for whatever you need. But it's not the only consideration when you are choosing a loan. Here are other factors to keep in mind.

Interest Rate and APR

The interest rate on an installment loan can mean a difference of thousands of dollars over the life of your loan. The interest is the money you pay to the lender for the ability to borrow money. But there's an even more important number to consider: the annual percentage rate.

The APR takes into account any fees — including loan origination fees — associated with the loan. When you're comparing loans, make sure to compare the APR, as this is the total annual cost of the loan.

Loan Amounts

Some lenders, such as SoFi, allow you to borrow up to $100,000, making it ideal for larger home improvement projects, debt consolidation and other pricey purchases. Others, like Discover, cap loan amounts at $40,000. Before you shop around for a loan, it's a good idea to know exactly how much you want to borrow for the issue at hand.

Credit Score Required To Qualify

The best loans with no origination fees are typically only available to borrowers with good-to-excellent credit. If you don't qualify for one of these loans, consider a loan for borrowers with bad credit. Some lenders will allow borrowers with a credit score as low as 600 to qualify for a loan. These lenders usually take other factors, like income and steady employment, under consideration.

The downside of getting a bad credit loan is that you'll likely face higher interest rates. If possible, consider working to improve your credit score before you decide to move forward with a personal loan to help you lock in the best rates.

Final Take

If you have good-to-excellent credit, it can make sense to borrow money for a large purchase. That way, you can leave other money in investment accounts where it can work for you. Other times, you don't have access to cash and need to borrow money to cover desired expenses. You may also want to consolidate high-interest credit card debt into a low-cost personal loan.

In any of these cases, if you have good credit, you'll have more options to borrow money. It helps to look for a loan with low interest rates, flexible choices in low terms and no fees.

FAQs

Can I get a personal loan without an origination fee?

Many personal loans have origination fees ranging from 1% to 5% of the total loan amount. Some may even charge as much as 10%, or a flat-rate fee. But a handful of lending companies, banks and credit unions offer personal loans with no origination fee.

Can you avoid loan origination fees?

To avoid loan origination fees, you'll need to apply for and take out a loan with a lender that doesn't charge loan origination fees, such as LightStream, SoFi, Discover or PenFed Credit Union.

Are origination fees normal for personal loans?

Origination fees, which are usually a percentage of the total loan amount, are normal when you take out a personal loan. To avoid these fees, shop around for a loan that offers no origination fees. Typically, borrowers with a higher credit score and strong credit history will have an easier time avoiding loan origination fees.

Which loan does not have an origination fee?

None of the loans in this roundup have origination fees.

Does SoFi charge an origination fee?

SoFi is one of the lenders that does not charge an origination fee for personal loans.

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