Personal Loan Requirements: What You Need To Qualify

Each lender will have different requirements to qualify for a personal loan. These requirements usually revolve around your credit score and income-to-debt-ratio.

Most lenders will require you to provide personal information, such as:

• Diver's license or other government ID

• Proof of U.S. citizenship or residence

• Proof that you're at least 18 years old

• Bank account

• Credit history

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.

What Credit Score Do You Need for a Personal Loan?

Your credit score provides a snapshot of your overall financial health. A common minimum credit score for personal loans is 580, though some lenders require a score as high as 660.

Not only does having a good credit score help you get approved for a loan, but it can also get you the best interest rates. A high credit score of 720 or above is your best bet for securing the lowest interest rates, because it demonstrates to the lender that you have an established history of paying back borrowed money on time.

What Debt-to-Income Ratio Do You Need for a Personal Loan?

Beyond having a good credit score, you'll need stable income to qualify for a personal loan. Minimum income requirements vary by lender, but you'll generally need to show where your income is coming from. Without this, lenders won't have any assurance that you'll be able to repay the funds you borrow.

Lenders will also look at your debt-to-income (DTI) ratio. Your debt-to-income ratio is a percentage that reflects how much of your income goes toward paying off debt. A lower DTI indicates that you have a manageable amount of debt and are more likely to be able to repay a loan without any issues. Mandy lenders consider a DTI of 35% or less to be good.

Common Reasons for Denial and What To Do Next

Here are some common reasons you might get rejected for a personal loan and how you can troubleshoot them to apply again successfully.

Alternatives to Personal Loans

A personal loan isn't the only way you can finance an expense. You can also use:

• Home equity line of credit (HELOC)

• Personal line of credit

• 0% intro APR offer on a credit card

Is a Personal Loan the Right Choice for You?

Before you apply, make sure you:

• Shop around for the lowest interest rates

• Avoid origination fees, if possible

• Can afford the monthly payments on the loan

Late payments can cost you a lot of money in fees and will tank your credit score, making it more difficult to borrow money in the future.

FAQ:

What do you need to get a personal loan?

You'll need to provide proof of ID, proof of income, proof of address, etc. to get a personal loan. Most lenders also have minimum credit score requirements.

How to qualify for a personal loan with bad credit?

If you have bad credit, you may need to get a secured loan or apply with a cosigner.

Can I get a personal loan without a job?

You generally need to demonstrate a solid source of income to get a personal loan, but you may be able to apply with a cosigner or to get a secured loan.

What is the minimum credit score for a personal loan?

Most personal loans have a minimum credit score requirement of 580 at the lowest.

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