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Discover Personal Loans Review
Though there are few stringent requirements to apply, those with credit scores below 660 won’t be able to secure a loan through Discover. If you fall into this category, you may want to check out another personal loan lender, like OneMain Financial, that doesn’t have a credit score requirement. On the other side of the spectrum, those with excellent credit will likely be able to find a better deal elsewhere. Some of the best personal loan companies offer rates as low as 3% APR to those with good credit, which could save you a significant amount of money over the life of your loan.
Discover personal loans at a glance
|Eligibility requirements||Good credit, minimum annual household income of $25,000|
|Best for||Borrowers who are comfortable with online or mobile banking and in need of a loan up to $35,000|
|Not for||Borrowers with blemishes on their credit or who need a co-signer|
|Standout features||Customize your loan by referring to Discover’s personal loan calculator and choosing terms between 36 and 84 months.|
Discover can pay your lenders directly if you have a debt consolidation loan.
|Customer service||Account login|
Application phone support: 1-866-248-1255, weekdays 8 a.m. to 11 p.m. ET and weekends 9 a.m. to 6 p.m. ET.
General questions: 1-877-256-2632, weekdays 8 a.m to 8 p.m.
Mail: Discover Personal LoansP.O Box 30954Salt Lake City, UT 84130-0954
*Rates accurate as of January, 2021.
What we like about Discover personal loans
Online application process
The online loan application process is streamlined and relatively quick. That’s good news if you’re in a cash crunch and don’t have weeks to wait on a decision from a lender. You can even check for a rate by prequalifying first, with no hit to your credit score. If you like the offer and wish to proceed, Discover will do a hard credit pull to finalize the loan. Discover claims that most loan applications receive a decision same-day. And if you’re stuck along the way, you can always call and continue the loan application over the phone.
No origination fees
Most loans come with loan application and origination fees. Some borrowers don’t realize this until they’re ready to close on the loan. Loan origination fees can end up costing you as much as 1% to 8%, usually deducted from your loan funds. Discover personal loans don’t come with this steep fee so you can focus on getting your personal loan — and your Discover loan paid off as quickly as possible.
Things to consider
As with all loan products, there are pros and cons when you borrow. It doesn’t hurt to prequalify for a Discover personal loan — the initial application won’t affect your credit score and you’ll get a good idea of what your interest rate may be. However, before you move too far along in the process, keep the following in mind.
Good credit required
Discover doesn’t offer bad credit loans. You’ll need good credit to successfully get funded. Discover doesn’t specify the exact credit score you’ll need, but anyone with a FICO below 650 will probably get declined. There are workarounds — most lenders allow you to have a cosigner with good credit to take responsibility for the loan if you can’t make payments. Unfortunately, Discover doesn’t allow for cosigners.
Strict loan purposes
Discover restricts its personal loans, depending on what you plan on using the money for. The lender doesn’t allow you to take out Discover personal loans to pay off a secured loan, in which you placed something as collateral, such as a vehicle or other asset. In addition, most of the Discover loans offered can’t be used as student loans to fund college.
Discover personal loan borrower requirements
- Credit score: Good or excellent
- Income: $25,000 annual household income or higher
- No cosigners allowed
Discover debt consolidation loan
A thorough Discover personal loans review reveals comprehensive debt consolidation loans, since they’re one of the most popular loan types for Discover. If you have several credit cards with high balances and a high interest rate, it could make financial sense to roll the debt over into a single loan product at a lower interest rate. Doing so could save you thousands of dollars in interest and shorten how long you’ll need to pay your debt off.
There are some requirements you need to be aware of, though. If you’re approved for a Discover debt consolidation loan, at least 70% of the funds must be transferred to your creditors. Most borrowers are happy with this requirement. Discover even handles the transfer for you, if you’d like, to take the guesswork of how best to pay off your old creditors with the funds from your new loan.
Can I refinance a personal loan with Discover?
Discover loans are pretty flexible, but do come with a few small limitations. You can refinance a personal loan using a Discover loan as long as the debt isn’t from a secured loan or student loans. Secured loans use collateral, such as investment accounts, your vehicle or a down payment to provide you with a loan.
How to take out a Discover personal loan
- Call 1-866-248-1255 to apply or use the online application.
- Select personal loan or debt consolidation loan.
- Enter personal contact information including an email address, residential address and phone number.
- Choose the loan amount you’d like between $2,500 and $35,000.
- Select the loan term length, between 36 and 84 months.
- Provide your Social Security number.
- Answer questions required to verify your identity.
- If you’re applying for a debt consolidation loan, you’ll need to enter information about the creditors you wish to pay off.
- Wait for an answer, which typically comes in the same day.
- Enter banking information including your bank’s routing number and bank account for Discover to transfer the funds to.
Discover in the news
- In July 2020, Discover supported Black-owned restaurants by awarding $5 million among 200 restaurants randomly selected from a long list of nominees to receive $25,000 each.
- The Human Rights Campaign’s Annual Corporate Equality Index recognized Discover for the seventh year in a row as the best place to work for LGBTQ equality in February 2020.
- Story2 partnered with Discover in November 2020 to provide free college scholarship essay services during the pandemic for families and students in need.
We welcome your feedback on this article and would love to hear about your experience with the personal loans we recommend. Contact us at email@example.com with comments or questions.