Best Installment Loans for 2020

Installment loans are a great financial tool for people who want to make a large purchase and don’t have the cash to do it. Unlike credit cards, which you might use to borrow revolving amounts and pay them back as you go, installment loans involve borrowing one single sum and repaying it over time in scheduled payments. Installment loans can be advantageous over credit cards because they’re more predictable and usually offer lower interest rates.

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      The best personal installment loans can finance the major purchases in your life, from home renovations to that really expensive vet bill after your dog ate a sock. We rated the best installment loan providers using our proprietary SimpleScore methodology to compare interest rates, loan amounts, customer satisfaction, support and fees.

      The 7 best installment loans of 2020

      Installment loans at a glance

      LenderAPRTermsLoan Amount
      LendingClub10.68%–35.89%3–5 years$1,000–$40,000
      PersonalLoans.com5.99%–35.99%90 days–3 years$500–$35,000
      Avant9.95%–35.99%2–5 years$2,000–$35,000
      Prosper7.95%–35.99%3–5 years$2,000–$40,000
      OneMain18.00%–35.99%2–5 years$1,500–$20,000
      Best Egg5.99%–29.99%3–5 years$2,000–$35,000
      LightStream3.49%–19.99%2–7 years$5,000–$100,000

      Best peer-to-peer lender – LendingClub

      LendingClub offers peer-to-peer loans up to 40% for borrowers with good credit.

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

      LendingClub is an online installment loan provider that connects borrowers with peers who are willing to provide loans. It’s a great way to get a loan without having to go through a bank. However, like other peer-to-peer lenders, you’ll have to keep in mind that LendingClub charges an origination fee of 1% to 6% on top of its APRs. LendingClub also has fairly strict credit requirements and won’t let you apply if your credit score is under 600. If you have a credit score on the higher end, you might be able to get a very competitive rate.

      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.

      Best lending marketplace – PersonalLoans.com

      We appreciate how easy PersonalLoans.com makes the borrowing process by comparing rates for you. Just be sure to do thorough research on your chosen lender before signing anything.

      APR Range
      5.99%–35.99%
      Term
      90 days–72 months
      Loan Amount
      $500–$35K
      SimpleScore
      3.8 / 5.0
      close
      SimpleScore PersonalLoans.com 3.8
      Rates 2
      Loan Size 5
      Customer Satisfaction N/A
      Support 3
      Fees 5

      If you’ve ever gotten advice on any type of loan, you’ve probably heard the same thing over and over again: shop around for the best rates. PersonalLoans.com makes the comparison process easy by providing an online installment loan marketplace where you can compare rates and terms from different lenders. Rates vary widely from 5.99% to 35.99% depending on your credit, and it’s important to remember that PersonalLoans.com doesn’t set these rates but receives them from each lender. Borrowers with credit scores as low as 580 can apply through PersonalLoans.com, although some lenders may set higher minimum requirements.

      Best for average credit – Avant

      You won’t be disqualified from applying for a loan through Avant solely based on your credit score. While this is good news for those with past financial struggles, borrowers with excellent credit can probably find a better rate elsewhere.

      APR Range
      9.95%–35.99%
      Term
      $2K–$35K
      Loan Amount
      24–60 months
      SimpleScore
      3.2 / 5.0
      close
      SimpleScore Avant 3.2
      Rates 2
      Loan Size 5
      Customer Satisfaction 2
      Support 4
      Fees 3

      Avant is an online installment loan provider that services loans originated by WebBank, an FDIC-insured lender. The biggest draw to Avant is that there’s no official minimum credit requirement to apply, although those with poor credit will pay significantly higher interest rates. APRs start at 9.95% and go as high as 35.99%, and the platform charges an additional 4.75% origination fee. The minimum loan amount is $2,000, so borrowers who only need a small loan will need to look elsewhere.

      Avant Disclosure

      The actual loan amount, term, and APR amount of loan that a customer qualifies for may vary based on credit determination and state law. Minimum loan amounts vary by state. Avant branded credit products are issued by WebBank, member FDIC.

      Best for joint applications – Prosper

      Prosper won’t issue loans to individual borrowers with credit scores under 640, but joint applicants might have better luck at getting approved – and getting a lower APR.

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

      Prosper is a peer-to-peer loan provider that loans amounts between $2,000 and $40,000. With a minimum credit score of 640, the application process is much stricter than with other peer-to-peer installment loan providers. However, Prosper is unique in that it offers joint loans, which allows you to apply with a friend or family member. Joint applications could increase the chance of approval for those with lower credit scores and even get you a better interest rate.

      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.

      Best installment loan for emergencies – OneMain Financial

      OneMain can give you access to emergency cash in a pinch, but you’re likely to end up with a higher interest rate than you would elsewhere.

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

      Sometimes emergencies come up that you simply can’t predict. If you need to pay for unforeseen expenses and can’t wait several days to get approved and receive your loan, OneMain is a great option. Applicants that are approved before noon can visit a OneMain branch and get their funds on the same business day. There’s no minimum credit score to apply, so even those with poor credit can get emergency cash in a pinch. However, you’ll pay for the convenience with extremely high APRs that start at 18.00%, so those who can afford to wait a few days may want to look at other lenders.

      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.

      Best debt consolidation installment loan – Best Egg

      Best Egg’s debt consolidation loans offer great terms, but you’ll need to have a good handle on your debt in order to qualify.

      APR Range
      5.99%–29.99%
      Term
      3–5 years
      Loan Amount
      $2K–$35K
      SimpleScore
      3.8 / 5.0
      close
      SimpleScore Best Egg 3.8
      Rates 4
      Loan Size 5
      Customer Satisfaction N/A
      Support 3
      Fees 3

      A common use of personal installment loans is consolidating debt with higher interest rates into a single monthly payment at a better rate. Best Egg offers debt consolidation loans for individuals with a credit score of at least 700 whose debt-to-income ratio is under 36%. Interest rates can be fairly low based on your creditworthiness with an APR range of 5.99% to 29.99%. You’ll also have to pay an origination fee between 0.99% and 6.99%.

      Best Egg Disclosure

      Best Egg loans are unsecured personal loans made by Cross River Bank, a New Jersey State Chartered Commercial Bank, Member FDIC, Equal Housing Lender. “Best Egg” is a trademark of Marlette Funding LLC. All uses of “Best Egg” on this site mean and shall refer to “the Best Egg personal loan” and/or “Best Egg on behalf of Cross River Bank, as originator of the Best Egg personal loan,” as applicable. Loan amounts generally range from $2,000-$35,000. Offers up to $50,000 may be available for qualified customers who receive offer codes in the mail. The minimum individual annual income needed to qualify for a loan of $50,000 is $130,000. Borrowers may hold no more than two open Best Egg loans at any given time. In order to be eligible for a second Best Egg loan, your existing Best Egg loan must have been open for at least six months. Total existing Best Egg loan balances must not exceed $50,000. All loans in MA must exceed $6,500; in NM and OH must exceed $5,000; in GA must exceed $3,000.

      Best online installment loan – LightStream

      LightStream blows all other online installment loan providers out of the water with great loan terms and no fees.

      APR Range
      2.49%–19.99% w/AutoPay
      Term
      24–84 months
      Loan Amount
      $5K–$100K
      SimpleScore
      4.8 / 5.0
      close
      SimpleScore LightStream 4.8
      Rates 5
      Loan Size 5
      Customer Satisfaction 4
      Support 5
      Fees 5

      Nearly all lenders offer convenient web-based loan applications in today’s digital world, but LightStream offers the best installment loans online according to our analysis. You can borrow up to $100,000 with repayment terms as long as seven years, neither of which can be matched by most other online lenders. Interest rates are competitively low at 3.49%–19.99%, which you can reduce further by 0.50% if you sign up for automatic payments. There are no origination fees, late fees or any type of fees at all.

      LightStream Disclosure

      Disclaimer: Your loan terms, including APR, may differ based on loan purpose, amount, term length, and your credit profile. Excellent credit is required to qualify for lowest rates. Rate is quoted with AutoPay discount. AutoPay discount is only available prior to loan funding. Rates without AutoPay may be higher. Subject to credit approval. Conditions and limitations apply. Advertised rates and terms are subject to change without notice.

      Payment example: Monthly payments for a $10,000 loan at 4.99% APR with a term of 3 years would result in 36 monthly payments of $299.66

      © 2020 Truist Financial Corporation. SunTrust, Truist, LightStream, the LightStream logo, and the SunTrust logo are service marks of Truist Financial Corporation. All other trademarks are the property of their respective owners. Lending services provided by Truist Bank.

      What is an installment loan?

      An installment loan is a broad type of loan that involves borrowing a lump sum and paying it back in regular payments — aka, installments — over a predetermined period of time, usually several years. Personal loans are a common and versatile type of installment loan, although mortgages, student loans and car loans are all types of installment loans.

      Installment loans typically have a fixed interest rate that is determined at the time of application so you’ll always know exactly how much you need to pay back. Common uses of personal installment loans including debt consolidation, home remodeling and medical bills.

      [Read: Best Personal Loans for 2020]

      How installment loans work

      When you take out an installment loan, you’ll tell the lender exactly how much you want to borrow and how much time you’d like to pay it back. Based on this information and your personal creditworthiness, the lender will issue you a loan with clearly laid out terms for repayment. You’ll be expected to make set monthly payments for the full duration of the agreed-upon time period until the loan is repaid in full. If you miss payments, you’ll be charged late fees and your credit score may be affected.

      Terms

      Installment loan terms work similarly to terms on other types of loans. Loan repayment terms specify the amount of time a borrower has to pay back the amount they borrowed plus interest; with personal installment loans, this can be anywhere from a few months to several years. Your loan terms will specify the APR, or the interest rate you’re charged based on your credit score. Late fees and any other types of fees are also considered terms of a loan.

      Monthly payments

      Although you’ll be given a set period of time to repay an installment loan in the loan’s terms, that doesn’t mean you can just make payments whenever you feel like it. Installment loan providers expect that borrowers will make monthly payments on time and in full every time. This monthly payment will go partially towards the principal balance, or the amount you initially borrowed, and will also cover some of the interest you owe.

      How to choose the best installment loan for you

      1. Decide how much you need to borrow and for what purpose. Since installment loans are a one-time loan, you don’t want to underestimate the amount you need, but borrowing too much means you’ll have to pay more in interest. Try to get as accurate as you can.
      2. Check your credit. It’s always a good idea to look at your credit report before applying for any type of loan to make sure there aren’t any errors. Incorrect information could bring your credit score down and cause you to end up with less favorable loan terms.
      3. Shop around for loans. Different lenders will offer you varying rates depending on your creditworthiness. For installment loans, make sure you compare rates with a few different types of lenders, such as peer-to-peer networks and lender marketplaces.
      4. Choose a lender. You’ll have to submit a formal application to be approved for a loan, and this process can take anywhere from a couple seconds to several days. Once you’ve been approved, you should have your funds within a few business days.

      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

      Installment loans FAQs

      Installment loans are highly versatile and can be used for many purposes. People often use installment loans to buy cars, pay medical bills, consolidate other types of debt or cover unexpected major expenses. Some lenders may ask you what you intend to use your installment loan for.

      Your credit score tells lenders how likely you are to pay back your loan. Borrowers with a higher credit score will get better terms, but those with poor credit will have to pay more in interest. This is because lenders expected to get compensated for the amount of risk they take on in issuing you a loan.

      There’s no limit to the number of installment loans you can have, although some lenders may discourage this practice by limiting you to a certain number of loans from their particular institution. Keep in mind that every time you apply for a new installment loan, the hard inquiry will show up on your credit report and bring your score down. It’s best to limit the number of loans you have at once.

      Last updated July 22, 2020 – Updated SimpleScore data.

      We welcome your feedback on this article and would love to hear about your experience with the installment loans we recommend. Contact us at inquiries@thesimpledollar.com with comments or questions.

      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.

      Lisa Mellio

      Contributing Writer

      Lisa Melillo is a freelance writer and entrepreneur with a background in personal finance, insurance, and international business. In addition to contributing to Bankrate, she has appeared in Money and Reviews.com and frequently ghostwrites for other entrepreneurs.

      Lisa’s career has taken her around the globe; she has lived in four countries, speaks three languages, and holds two international degrees, including a Master’s in International Business from Universitat Pompeu Fabra in Barcelona. She currently spends most of her time in Connecticut, where she lives with her husband and two dogs.

      Reviewed by

      • Courtney Mihocik
        Courtney Mihocik
        Editor

        Courtney Mihocik is an editor at The Simple Dollar who specializes in insurance, personal finance, and loans. Previously, she wrote and edited for Interest.com, PersonalLoans.org, Ballantyne Magazine, Thread Magazine, The Post, ACRN, The New Political, Columbus Alive and the Institute for International Journalism.