Personal loans are highly flexible loans that you can use for almost any purpose. One benefit of personal loans is that many lenders have low loan minimums, meaning you can get a small personal loan if you only have a small financial need.
Even if you’re borrowing a small amount, it’s important to consider your options and choose the best small personal loan for your needs. We’ll break down everything you need to know about small personal loans.
Best Small Personal Loans
For the best small personal loans, we recommend these lenders.
Best overall – LightStream
- APR: 3.99% - 19.99%
- Minimum credit score: 660
- Loan amounts: $5,000 - $100,000
If you’re looking for the best personal loans overall, LightStream is hard to beat. It offers some of the lowest interest rates available and is highly flexible when it comes to the amount you can borrow. The minimum is $5,000, which is a bit higher than some of the competition, but you can borrow as much as $100,000.
You can also work with LightStream to customize your monthly payment by choosing a loan term between 2 and 7 years.
Best for low interest rates - Marcus
- APR: 6.99% - 19.99%
- Minimum credit score: Not disclosed
- Loan amounts: $3,500 - $40,000
Personal loans, like any loan, charge interest. Even for a small personal loan, you want to keep the interest rate low to make the loan as inexpensive as possible. Marcus offers personal loans with low interest rates and a minimum loan of just $3,500. Best of all, there are no origination fees, late payment fees, or other fees to worry about, keeping the personal loan inexpensive.
Best for variety of loan terms - SoFi
- APR: 6.99% – 22.23%
- Minimum credit score: 650
- Loan amounts: $5,000 - $100,000
Small personal loans usually have relatively short repayment periods. The term of a loan impacts both the amount of interest that will accrue and the monthly payment, so having flexibility in choosing your loan term means you can customize your monthly payment.
With SoFi, you can get loans at relatively low rates and choose from terms between 2 and 7 years, giving you lots of flexibility in your monthly personal loan payment.
Best for fast funding – US Bank
APR: 5.99% - 18.49% Minimum credit score: 660 Loan amounts: $1,000 - $50,000
Sometimes, you’re applying for a personal loan due to a pressing need. You might have a medical bill or a car repair that you have to pay, and you can’t afford to wait for a lender to take days to look at your application, approve it, and send money.
On top of its low personal loan minimums and interest rates, US Bank offers some of the quickest approvals and funding available. If you have strong credit, you can submit an application and get your loan funded on the same day.
Best for bad credit - Upstart
- APR: 5.40% - 35.99%
- Minimum credit score: 300
- Loan amounts: $1,000 - $50,000
Getting a personal loan can be hard if you have bad credit. Even if you do find a willing lender, your personal loan will likely carry high fees and interest rates.
Upstart is an unusual lender in that it looks at more than just your credit when deciding whether to approve you for a personal loan. It considers factors such as your educational history and employment to determine whether you qualify.
For example, if you have an in-demand degree and a strong job history, you have a good chance of getting a personal loan from Upstart, even if you have bad credit. That makes Upstart the best option for personal loans if you don’t have good credit.
Best for low minimums - Upgrade
APR: 5.94% - 35.97% Minimum credit score: Not disclosed Loan amounts: $1,000 - $50,000
If you’re in the market for a small personal loan, you don’t want to borrow more money than you need to. Borrowing more than necessary means paying extra interest for no real reason. That means it’s best to get a loan for as close to the exact amount of cash that you need as possible.
With Upgrade, you can borrow just $1,000 and take between 2 and 7 years to pay it back. That makes it easy to borrow the right amount even for small financial needs and makes the monthly payment affordable.
What is a Small Personal Loan?
A personal loan is a type of loan that you can use for nearly any purpose, like paying an unexpected bill or consolidating debt. Small personal loans are a specific category of personal loans, typically letting people borrow as little as a few hundred or thousand dollars at once. These small loan minimums help you cover unexpected expenses while keeping loan costs low.
How to Choose the Best Small Personal Loan?
When you compare small personal loans, consider these factors.
- Loan minimum – If you want a small personal loan, look for lenders with low loan minimums. Make sure the minimum is less than or equal to the amount you need because you don’t want to borrow more than necessary.
- Fees – Some small personal loan providers charge fees like origination fees or prepayment penalties. Try to choose a lender that doesn’t have these fees to keep your loan costs low.
- APR – The APR of a loan is its effective annual interest rate. The lower a loan’s APR, the less you’ll pay each month and overall, so look for lenders that keep rates low.
- Credit requirements – Different personal lenders have different minimum credit score requirements or other credit-related prerequisites you need to meet. Make sure you have a good chance of qualifying with a lender before you submit your application.
- Term options – Personal loan terms are usually short, about five years or less. However, some lenders will give you more flexibility to choose your loan term. Long-term loans cost more overall but have lower monthly payments. Short-term loans have higher payments but lower overall costs. Choose a lender that offers a term that fits your budget.
- Speed of funding – If you need money fast, you want to find a lender that offers quick approval and funding for its personal loans.
Best Place to Get a Small Personal Loan
You can get small personal loans from a few different sources.
Online lenders are one of the most popular sources of small personal loans. There are dozens of online personal loan companies, each with specific focuses, strengths, and weaknesses.
It should be easy to find personal loan options with loan minimums as low as $1,000 or less. Online personal loans also tend to have low interest rates and fees, as well as quick funding times.
Another good source for small personal loans is a bank. Most banks offer lending services, including personal loans. The best place to start your search is with the bank you use for your deposit accounts. You might find that it offers perks like interest rate discounts for existing customers.
The drawback of getting a personal loan from a bank is that it usually takes a bit longer to apply and get your funds.
Getting a personal loan from a credit union can be a great idea, but there are some drawbacks.
On the plus side, credit unions are community institutions that operate for the benefit of their account holders. You might be able to qualify for a small loan, as low as a few hundred dollars, even if you don’t have perfect credit.
However, to apply for a personal loan, you’ll need to be a member of the credit union. Credit unions might also take a while to review your application and approve your personal loan.
Alternatives to Small Personal Loan
If you need a small amount of cash, there are a few options other than applying for a small personal loan.
Credit cards have incredibly high interest rates but can be a viable alternative to small personal loans in some cases.
So long as you pay the card’s balance in full before the due date, interest won’t accrue. That can give you a month or so to pay the balance without having to deal with interest. That can be enough if you only need to borrow a small amount.
For larger amounts, consider opening a new credit card with a 0% interest period. You can often find cards offering introductory interest rates for a year or more.
Borrow from friends and family
If you have a network of friends and family that you can lean on, you can always ask to borrow small amounts from them.
However, before turning to friends and family over a personal loan, consider the unique risks of borrowing from them. Getting money involved can add a lot of stress and strain to the relationship. Make sure to be clear about how much you need to borrow and how and when you’ll pay them back.
Community organizations and non-profits
Instead of applying for a personal loan, you can consider looking to community organizations and non-profits for help. For example, if you’re considering a loan to help pay medical bills, you might be able to find a local group that helps people with medical costs.
There are also options like food pantries, temporary housing, and other resources you can use to reduce your expenses and avoid the need for a personal loan.
Small personal loans can be a good way to cover unexpected expenses that range from a few hundred to a few thousand dollars. However, just because you’re borrowing a small amount doesn’t mean you should ignore the essential aspects of personal loans, such as interest rates and fees.
Make sure to compare all the small personal loan options in your area to find the best deal.
Frequently Asked Questions
These are some of the most frequently asked questions about small personal loans.
What is the Difference Between Small Personal Loans and Payday Loans?
Small personal loans usually let you borrow a few hundred to a few thousand dollars and give you more time to repay the loan. Usually, the terms are measured in years.
By contrast, payday loans usually have terms measured in weeks and have APRs that are multiple times higher than personal loans.
Is it possible to get a small personal loan?
Yes, it is possible to get small personal loans. Some lenders offer personal loans as low as a few hundred to a few thousand dollars.
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