Best Personal Loans for Excellent Credit in 2024 - NerdWallet (2024)

FAQs

Will personal loan rates go down in 2024? ›

Lower personal loan rates may be on the horizon in 2024 after the Fed made progress curbing inflation at the end of 2023. That progress came after four more Federal Reserve rate hikes in 2023.

Some of the easiest loans to get approved for if you have bad credit include payday loans, no-credit-check loans, and pawnshop loans. Personal loans with essentially no approval requirements typically charge the highest interest rates and loan fees.

The best banks for personal loans are Discover, American Express, Wells Fargo and Citibank. These banks are great for personal loans because they provide the most competitive terms on the market, including low APRs, $0 origination fees, large loan amounts, long payoff periods and more.

Requirements to receive a personal loan

This allows them to look at your history from the past seven years and see whether you've typically made payments on time. For a $30,000 loan, you'll typically need a credit score above 600 just to qualify or above 700 to get a competitive rate.

In its April Mortgage Finance Forecast, the Mortgage Bankers Association predicts that mortgage rates will fall from 6.8% in the first quarter of 2024 to 6.4% by the fourth quarter. The industry group expects rates will fall below the 6% threshold in the fourth quarter of 2025.

You might get a better deal in 2024

While interest rates are up right now, things could start to change in 2024 if the Fed decides to cut rates. So next year might be a better time to put a personal loan in place. Let's say you're looking to borrow $10,000 and pay it back over a five-year period.

Use Collateral To Secure The Loan

If your credit score is lower than you need it to be, you could consider a secured loan. The inclusion of collateral makes secured loans easier to get approved for, as it assures the lender they'll get their money back one way or another – even if you default on the loan.

Hardship personal loans are a type of personal loan that is designed to help you overcome financial difficulties. This type of loan is generally offered by small banks and credit unions, and has lower interest rates, lower maximum loan amounts, and shorter repayment periods than standard personal loans.

Your options for poor credit loans include: Personal loans: Some personal loans are available with bad credit, but you will likely pay higher interest rates and may not be able to borrow the full amount. Secured loans: With a secured loan, you put up an asset as a guarantee when you apply for a loan with bad credit.

Higher interest rates and fees: Banks tend to charge higher interest rates and more fees compared to their credit union and online lender counterparts. 12 If you don't qualify for a discount rate, you might end up paying more through a bank than you would with another lender.

Who gives best personal loan? ›

Best for excellent credit: LightStream

It's one of the fastest overall in terms of loan funding speed, with borrowers able to obtain funds as quickly as the same day they're approved. LightStream loanscan be used to cover a variety of expenses, from debt consolidation to home renovations to emergency car repairs.

Highlights: While older models of credit scores used to go as high as 900, you can no longer achieve a 900 credit score. The highest score you can receive today is 850. Anything above 800 is considered an excellent credit score.

Know your credit history: Because $60,000 is such a large sum of money and there are fewer lenders that offer such large loans, you'll find it's harder to qualify for. You'll typically need good or excellent credit (a FICO score of 670 or higher) and may need to meet certain income requirements.

A good personal loan interest rate depends on your credit score: 740 and above: Below 8% (look for loans for excellent credit) 670 to 739: Around 14% (look for loans for good credit) 580 to 669: Around 18% (look for loans for fair credit)

While waiting to buy a home could mean a lower interest rate, there's no guarantee that rate drop will happen. If you have the budget to buy a home now, another option is to purchase today, but refinance later once rates drop further. The MBA projects a 5.5% rate by the end of 2025.

Trading Economics offers a more optimistic outlook, predicting a rise to 5% in 2023 before falling to 4.25% in 2024 and 3.25% in 2025. This forecast is supported by Morningstar's analysis, which projects rates between 3.75% and 4%.

Personal loans are typically unsecured, which means there's no collateral to back the loan. Your credit score plays a significant role in determining your personal loan interest rate, and a poor credit score can result in a higher interest rate.