Discover Personal Loans Review

Discover offers personal loans up to $35,000 and the flexibility to choose your repayment term, but those with good credit will be able to find lower rates elsewhere.

APR Range
6.99%–24.99%
Loan Amount
$2,500–$35K
Term
36–84 months
SimpleScore
4.4 / 5.0
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SimpleScore Discover, Member FDIC 4.4
Rates 5
Loan Size 5
Customer Satisfaction 3
Support 5
Fees 4

Discover offers personal loans ranging from $2,500 to $35,000, and interest rates from 6.99% to 24.99%. You get to choose your loan term, which can be anywhere between three to seven years. There are no fees as long as you pay on time, and you won’t be charged extra if you pay back your loan early. If you’d like, Discover will even send the money to your creditors directly. There’s also a 30-day money-back guarantee, which enables you to avoid interest charges if you pay back your money within 30 days.

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In this article

    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.

    The Discover Personal Loan Specs

    Interest Rates6.99% – 24.99%
    Loan Terms3 – 7 years
    RequirementsU.S. citizen or permanent resident
    Must be at least 18 years-old
    Minimum annual household income of $25,000
    Credit score of 660 or above
    Best ForThose who want flexible repayment terms
    Not ForThose who need money the same day
    Standout FeaturesNo fees as long as you pay on time
    Flexible loan terms
    Pay your creditors directly
    30-day money-back guarantee

    The Claim

    Discover helps bring your goals within reach, offering personal loans up to $35,000 to help you consolidate debt, make a major purchase, or even take a vacation. There are no fees as long as you pay on time, and you can choose how long your repayment term is, up to seven years. Should you run into financial trouble down the road, Discover will work with you to come up with a solution that’s mutually beneficial.

    Is it True?

    Yes. Discover offers personal loans ranging from $2,500 to $35,000. To qualify, you must be a U.S. citizen, at least 18 years-old, and have an annual household income of at least $25,000 or more. You must also have a credit score over 660. The majority of borrowers should have no problem meeting these requirements, but those with less than perfect credit may have to explore some other options, like OneMain Financial, which doesn’t have a minimum credit score required to apply.

    Discover’s interest rates are reasonable compared to its competitors. Borrowers with credit below 600 could end up paying up to 24.99% in interest. While that seems like a lot, it’s still a better deal than the 36% interest rates charged by some of Discover’s competitors, or the 300% APR most payday loans charge. If your credit is good, Discover may offer you rates as low as 6.99% on a personal loan. This isn’t bad, but you may be able to find better rates through a bank or another personal loan provider if your credit is that good, so you should shop around before committing to any lender.

    Unlike most personal loan providers, Discover doesn’t charge any origination fees or closing costs. There are no prepayment fees either, so if you decide to pay the loan back early, you can do so without being charged extra. The only time you’ll incur extra charges is if you make a late payment and Discover offers you a way out of this as well. You can sign up for automatic payments so you don’t have to worry about forgetting.

    Discover gives you the flexibility to choose your loan term, anywhere from three to seven years. Most personal loan providers cap loan terms at five years, and many don’t allow you to choose how long you need to pay it back. The company also offers a unique 30-day money-back guarantee, which charges no interest for customers who pay back the full value of their loan within a month.

    Our Discover Personal Loans Review Deep Dive

    • Borrow up to $35,000: Discover allows you to borrow between $2,500 and $35,000. Though a few lenders offer higher limits, Discover should be able to accommodate the majority of borrowers looking for a personal loan.
    • Reasonable interest rates: Discover’s 24.99% maximum APR is pretty affordable compared to what its competitors charge. Even its 6.99% minimum APR is a good deal compared to most personal loan providers, though you may be able to secure a lower rate through a bank or credit union if you have an excellent credit score.
    • Flexible loan terms: You can choose a loan term as short as three years, or as long as seven years. There are no prepayment fees, so you can always pay the loan off faster if you can afford to do so. Many personal loan lenders don’t allow their customers to choose the length of their repayment period, and even fewer give customers the option of a seven-year term. Though it’ll cost you quite a bit in interest, this is a nice option to have if you’re borrowing a large sum.
    • No fees as long as you pay on time: You don’t have to worry about unexpected costs arising down the road. There are no origination or prepayment fees, and interest rates are fixed, so your payments won’t go up over time.
    • No same-day deposits: Once you’ve filled out your application, you’ll receive your funds the next business day. It could take longer, though, if your application contains errors or missing information, so double check your application before submitting it.
    • Pay creditors directly: Discover can send funds directly to your creditors, if you prefer. This is a nice option to have when time is of the essence and you don’t want to wait for the funds to first be deposited in your account.
    • Money-back guarantee: If you return the funds you borrowed within 30 days, Discover won’t charge you any interest. It’s unlikely that you’d want to switch lenders so quickly after taking out a loan, but it’s nice to know Discover gives you that option, just in case.
    • Sign up for auto-payments: Discover enables you to sign up for automatic payments, so you don’t have to worry about forgetting to pay.
    • Financial education resources: Discover has a wealth of online articles covering personal loans, debt consolidation, and how to finance a major life event. It also offers calculators to help you determine how much your monthly payment will be and whether a debt consolidation loan is a smart move for you.

    Cost Rundown

    Though you can estimate how much your monthly payment will be, there’s no way of knowing what you’ll actually pay until you apply. Discover considers several factors in determining your interest rates, including your credit score, household income, and financial history. Payments will also vary depending on how much money you’re borrowing.

    If your credit is good, you can expect interest rates below 10%, but if you have average credit, you could pay as much as 24.99% APR. That’s not a bad deal when compared to payday lenders and even some other online personal loan providers, but it may be possible to secure a lower rate through a bank or credit union, particularly if your credit is good.

    Cheaper (or Free!) Alternatives

    To make sure you’re getting the best possible rate, you should shop around before committing to any loan. Apply through your bank first, and then compare how Discover and other personal loan lenders stack up that quote. Don’t just look at the monthly payment. Be on the lookout for hidden fees and calculate how much you’ll end up paying over the lifetime of the loan. Make sure you’re getting a fixed-rate loan, too. If you choose one with a variable interest rate, your payments could end up becoming more expensive over time.

    That may sound like a lot of work, but the amount you could save makes it worth the time investment. Say you borrow $10,000 at a 15% interest rate. Over the course of a five-year term, that loan will cost you $14,273.96. That same loan with a 16% interest rate will cost an extra $316.87. And depending on how much you borrow, your interest rates and your loan term, you could end up paying even more. The only way to avoid paying out hundreds of dollars in unnecessary interest is to do your research before committing to a loan.

    The Competition

    Offering loans up to $35,000, Prosper also doesn’t charge you anything for paying off your loan early.

    APR Range
    7.95%–35.99%
    Loan Amount
    $2K–$40K
    Term
    36–60 months
    SimpleScore
    3.2 / 5.0
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    SimpleScore Prosper 3.2
    Rates 2
    Loan Size 5
    Customer Satisfaction 3
    Support 3
    Fees 3

    There is an origination fee and repayment terms are three- to five-years, although Prosper chooses the exact length of time for you. You don’t get to decide. A minimum credit score of 640 is required for approval, and depending on your creditworthiness, your interest rate could fall anywhere between 7.95% and 35.99%. This makes Prosper a good choice for those with excellent credit, but those with poor credit may be able to find a lower rate elsewhere.

    Prosper Disclosure

    For example, a three-year $10,000 personal loan with a Prosper Rating of AA would have an interest rate of 5.31% and a 2.41% origination fee for an annual percentage rate (APR) of 6.95% APR. You would receive $9,759 and make 36 scheduled monthly payments of $301.10. A five-year $10,000 personal loan with a Prosper Rating of A would have an interest rate of 8.39% and a 5.00% origination fee with a 10.59% APR. You would receive $9,500 and make 60 scheduled monthly payments of $204.64. Origination fees vary between 2.41%-5%. Personal loan APRs through Prosper range from 7.95% (AA) to 35.99% (HR) for first-time borrowers, with the lowest rates for the most creditworthy borrowers. Eligibility for personal loans up to $40,000 depends on the information provided by the applicant in the application form. Eligibility for personal loans is not guaranteed, and requires that a sufficient number of investors commit funds to your account and that you meet credit and other conditions. Refer to Borrower Registration Agreement for details and all terms and conditions. All personal loans made by WebBank, member FDIC. Prosper and WebBank take your privacy seriously. Please see Prosper’s Privacy Policy and WebBank’s Privacy Policyfor more details. Notes offered by Prospectus. Notes investors receive are dependent for payment on unsecured loans made to individual borrowers. Not FDIC-insured; investments may lose value; no Prosper or bank guarantee. Prosper does not verify all information provided by borrowers in listings. Investors should review the prospectus before investing.

    A popular personal loan lender, OneMain offers loans up to $20,000.

    APR Range
    18%–35.99%
    Loan Amount
    $1,500–$20K
    Term
    2–5 years
    SimpleScore
    3.3 / 5.0
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    SimpleScore OneMain Financial 3.3
    Rates 2
    Loan Size 3
    Customer Satisfaction N/A
    Support 5
    Fees 3

    There’s no minimum credit score to apply, so it’s a good choice for those who are having trouble getting a loan elsewhere. Interest rates vary from 18.00% to 35.99%, which isn’t uncommon for personal loan providers, though it runs on the expensive side for borrowers with good credit.

    OneMain Financial Disclosure

    Not all applicants will qualify for larger loan amounts or most favorable loan terms. Loan approval and actual loan terms depend on your ability to meet our credit standards (including a responsible credit history, sufficient income after monthly expenses, and availability of collateral). Larger loan amounts require a first lien on a motor vehicle no more than ten years old, that meets our value requirements, titled in your name with valid insurance. Maximum APR is 35.99%, subject to state restrictions. APRs are generally higher on loans not secured by a vehicle. The lowest APR shown represents the 10% of loans with the most favorable APR. Active duty military, their spouse or dependents covered under the Military Lending Act may not pledge any vehicle as collateral for a loan. OneMain loan proceeds cannot be used for postsecondary educational expenses as defined by the CFPB’s Regulation Z, such as college, university or vocational expenses; for any business or commercial purpose; to purchase securities; or for gambling or illegal purposes.

    Borrowers in these states are subject to these minimum loan sizes: Alabama: $2,100. California: $3,000. Georgia: Unless you are a present customer, $3,100 minimum loan amount. Ohio: $2,000. Virginia: $2,600.

    Borrowers (other than present customers) in these states are subject to these maximum unsecured loan sizes: Florida: $8,000. Iowa: $8,500. Maine: $7,000. Mississippi: $7,500. North Carolina: $7,500. New York: $20,000. Texas: $8,000. West Virginia: $7,500. An unsecured loan is a loan which does not require you to provide collateral (such as a motor vehicle) to the lender.

    LendingClub is another peer-to-peer lender that offers loans up to $40,000.

    APR Range
    10.68%–35.89%
    Loan Amount
    $1K–$40K
    Term
    36–60 months
    SimpleScore
    3.2 / 5.0
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    SimpleScore LendingClub 3.2
    Rates 2
    Loan Size 5
    Customer Satisfaction 3
    Support 3
    Fees 3

    LendingClub’s interest rates are similar to Discover’s; although, individuals with poor credit may end up paying as much as 35.89% APR. If you have excellent credit, you may be able to score a rate as low as 10.68% APR. Lending Club requires a minimum FICO score of 600, which could put it out of reach of some borrowers.

    LendingClub Disclosure

    All loans made by WebBank, Member FDIC. Your actual rate depends upon credit score, loan amount, loan term, and credit usage and history. The APR ranges from 10.68% to 35.89%. For example, you could receive a loan of $5,700 with an interest rate of 7.99% and a 5.00% origination fee of $300 for an APR of 11.51%. In this example, you will receive $5,700 and will make 36 monthly payments of $187.99. The total amount repayable will be $6,767.64. Your APR will be determined based on your credit at time of application. *The origination fee ranges from 1% to 6%; the average origination fee is 5.2% (as of 12/5/18 YTD).* There is no down payment and there is never a prepayment penalty. Closing of your loan is contingent upon your agreement of all the required agreements and disclosures on the www.lendingclub.com website. All loans via LendingClub have a minimum repayment term of 36 months or longer.

    A good choice if you need a larger loan, Wells Fargo allows you to borrow anywhere from $3,000 to $100,000.

    APR Range
    5.99%–24.49%
    Loan Amount
    $3K–$100K
    Term
    12–84 months
    SimpleScore
    4 / 5.0
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    SimpleScore Wells Fargo 4
    Rates 5
    Loan Size 5
    Customer Satisfaction 3
    Support 4
    Fees 3

    There are no origination or prepayment fees. You can often get funds the same day, which is one advantage it holds over Discover. If you have a checking account through Wells Fargo, you may be eligible for discounts too, which can help bring down the cost of your monthly payments.

    Check Your Personal Loan Rates

    Answer a few questions to see which personal loans you pre-qualify for. It’s quick and easy, and it will not impact your credit score.

    Get Started

    with our trusted partners at Bankrate.com

    Methodology

    SimpleScore

    The SimpleScore is a proprietary scoring metric we use to objectively compare products and services at The Simple Dollar.

    For every review, our editorial team:

    • Identifies five measurable aspects to compare across each brand
    • Determines the rating criteria for each aspect score
    • Averages the five aspect scores to produce a single SimpleScore

    Here’s a breakdown of the five aspect scores and their rating criteria for our review of the best personal loans of 2020.

    Why do some brands have different SimpleScores on different pages?

    To ensure the SimpleScore is as helpful and accurate as possible, we developed unique criteria for every category we compare at The Simple Dollar. Since most brands offer a variety of financial solutions, their products and services will score differently depending on what we’re scoring on a given page.

    However, it’s also possible for the same product from the same brand to have multiple SimpleScores. For instance, if we compare NetCredit’s personal loans according to our criteria for the best personal loans, it scores a 2.3 out of 5. But when we compare NetCredit according to the criteria for the best bad credit personal loans, it scores considerably higher, since the criteria for the latter review are more lenient (lenders who serve borrowers with bad credit will always offer higher rates, so we needed to adjust our category methodology to account for different industry standards).

    Questions about our methodology?

    Email Hayley Armstrong at hayley@thesimpledollar.com.

    Rates

    We looked at the maximum APR for each lender — the lower their maximum rate, the higher their score.

    Loan Size

    We awarded higher scores to lenders with more generous loan sizes.

    Customer Satisfaction

    We leveraged the J.D. Power 2019 Personal Loan Satisfaction Study℠ to see how customers rated their experience with each lender. (If a lender wasn’t included in J.D. Power’s study, we skipped this aspect and averaged the four remaining aspect scores.)

    Support

    We awarded higher scores to lenders with the most channels for customer support.

    Fees

    We looked at the three most common fees — origination, late payment, and pre-payment — and penalized lenders for each fee charged.