Is it Hard to Get a Personal Loan?

A personal loan can be a useful tool to get the money you need for planned or unplanned life events. Meeting the lender’s requirements for a loan could be easy, but that depends on your personal financial situation.

In general, if lenders see the right signals that you’re likely able to repay your loan, you are more likely to get approved. The application process can often be quick, easy and convenient. For example, OneMain works with people online, on the phone and in person to help get them a personal loan.

Keep reading to learn how to improve your chances of being approved for a personal loan so you can get the extra money you need.

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

The minimum credit score required for a personal loan varies by lender, but even borrowers with limited or less-than-perfect credit may qualify.¹ Keep in mind that a lower credit score may mean paying a higher interest rate.

While credit scores are important, other factors like income, availability/eligibility of collateral, type of loan and the addition of a cosigner may help determine your ability to get a personal loan. Not all lenders use credit scores the same way. Some review your credit history individually or analyze your credit report with tailored systems.

Is it hard to get approved for a personal loan?

If you show lenders that you have the means to repay your loan and a responsible history of paying what you already owe, it may not be hard to find one that will work with you. There are resources on improving your creditworthiness to give yourself the best chance of approval. In addition to your credit score, there are other factors that affect how easy it is to get a personal loan:

Secured or unsecured loans

Deciding whether you’ll apply for a secured or unsecured personal loan could make a difference in your chances of approval. If your credit needs improvement, you may find it easier to get approved for a secured loan.

A secured loan requires you to back up or secure your loan with something of value (collateral) like a car or home. Secured loans often come with greater approval odds and possibly a lower rate and/or access to a bigger loan amount. The downside to a secured loan is that you may lose your collateral if you default on your loan.

Unsecured loans don’t require collateral but could offer lower loan amounts, higher interest rates and be tougher to get approved depending on the lender’s requirements. Both secured and unsecured loans can negatively impact your credit score if you fall behind on payments.

Income

Lenders will ask about your current and past employment when reviewing your application, as well as other sources of income. It’s more difficult to get approved for a loan without a steady income. Lenders will also consider money from a retirement account, public assistance and part-time employment. You don't have to disclose income from alimony or child support, but if you choose to, it can be counted when considering your ability to repay the loan.

Cosigners

Finding someone to co-sign your loan may be a good idea to help you meet your financial goals. A cosigner acts as a backup repayment option for the lender, who may then deem you to be less of a risk. The cosigner will share the risk with you as well as the consequences if you can’t make your payments.

What are the chances of getting approved for a personal loan?

If you have adequate income and your credit score is fair or good, your chances for approval may also be good. If your credit score and income level are in a building phase, consider communicating closely with your loan specialist to find an offer that matches your personal situation.

A great way to find out what types of OneMain loans are available to you is to see if you’re get prequalified. Checking for prequalified offers often doesn’t affect your credit score and may be done in just a few minutes.

Ways to increase your odds of getting approved for a personal loan

Figure out how much you need

Before you apply for a personal loan, you should know exactly how much money you need to borrow. Calculate how much your expenses are going to cost, like the total cost of an upcoming vacation that includes the flight, hotel, and dining. It’s important to ensure the loan amount fits with your budget, considering both the principal (original amount borrowed) and the interest (the cost of borrowing). This way, you can request the right amount and avoid borrowing more than you can comfortably afford.

Improve your credit

Your credit score plays a significant role in whether you'll be approved for a personal loan and the interest rate you'll receive. To improve your credit score, make sure you:

• Pay your bills on time
• Keep your credit card balances low
• Check for any errors on your credit report.

Building a good credit history will generally make you a more attractive candidate to lenders.

Add a cosigner

As we mentioned above, if you have a limited credit history or a low credit score, adding a cosigner to your loan application may increase your chances of approval.

Shop around

Don't settle for the first loan offer you receive. Instead, take the time to shop around and compare rates and terms from different lenders. Look for a loan that suits your needs and offers the best terms, including the lowest interest rate and fees.

Don’t forget to check for prequalified offers instead of applying for multiple loans. Applying will affect your credit score, checking for prequalified offers will not. When you check for prequalified offers you see a preview of what loan terms may be suitable, pending more information that comes with a full application.

Navigate your loan journey with confidence

Understanding your loan options isn’t hard with a little reflection and research. It starts with a clear idea of how you will spend the money and how you will repay it. Use our personal loan calculator to get a sense of monthly payments for different loan amounts, then check for prequalified offers. When it comes to personal loans, it pays to know before you borrow.

---

"Easiest Personal Loans To Get In 2022 – Forbes Advisor." 10 May. 2022, https://www.forbes.com/advisor/personal-loans/easiest-personal-loans-to-get/. Accessed 19 May. 2022.

This article has been updated from its original publishing on June 2022 by Andrea Hoyt, Kim Gallagher contributed to this article.