What Credit Score Do You Need for a Personal Loan?

There is no single credit score you need for a personal loan. Every lender sets its own requirements, and most look at much more than your score: your income, your existing debts, your credit history and the loan you are asking for. A score that gets you a good offer from one lender might not be enough for another.

The practical answer is to check your rate with a few lenders. Most online lenders use a soft credit inquiry for this, so it does not affect your credit score.

Why there is no one minimum score

Lenders compete for different kinds of borrowers. Some focus on applicants with strong, established credit. Others are set up to consider a wider range of profiles, usually at higher rates. Some use underwriting models that look at factors beyond the credit score.

That is why you will see very different eligibility messages across the market. Many lenders do not publish a fixed minimum at all, and those that do can change it. Any number you read on a third-party site, including a lender's own past disclosures, may be out of date.

Treat any "minimum credit score" you hear as a rough guide at best. The only reliable answer is the offer a lender gives you after checking your profile.

Common credit score bands

Most US lenders use FICO scores, which run from 300 to 850. FICO groups scores into general bands. These are FICO's general ranges, not lending rules, and each lender decides for itself how to treat them.

VantageScore, another scoring model, uses the same 300 to 850 scale but slightly different bands. Your score can also differ between the three credit bureaus, because each may hold slightly different information about you.

What lenders look at besides your score

Your credit score is a summary. Lenders usually dig into the detail behind it, and they look at your ability to repay. Here is what typically matters:

• Income and employment. Lenders want to see that you have enough steady income to cover the new payment.
• Debt-to-income ratio (DTI). This is your monthly debt payments divided by your monthly gross income. A lower DTI generally makes you a stronger applicant.
• Credit history length. A longer record of on-time payments gives lenders more to go on.
• Recent negative marks. Late payments, collections or a recent bankruptcy can weigh heavily, even with a reasonable score.
• Recent hard inquiries. Several new applications in a short time can make lenders more cautious.
• Loan amount and term. Asking for less, or for a term you can clearly afford, can change the outcome.
• State of residence. Not every lender operates in every state, and state rules can affect terms.

Some lenders go further. Upstart, for example, says its underwriting considers factors such as education and employment history. That may help some borrowers with a limited credit history, but it does not guarantee approval.

How lender focus varies

Here is how the lenders we review generally position themselves. This describes their general focus, not hard requirements. Check each lender's site for current eligibility.

If you want to see several lenders at once, a marketplace such as Credible can show prequalified offers from its partner lenders with one soft inquiry. Credible is not a lender and does not make the credit decision.

How to check your odds without hurting your score

You do not need to guess. Follow these steps:

1. Check your credit reports. You can get free reports from the three bureaus through the official site, AnnualCreditReport.com. Look for errors and dispute anything wrong.
2. Know your score. Many banks and card issuers show a free score. Remember it may be a different model from the one a lender uses.
3. Work out your DTI. Add up your monthly debt payments and divide by your monthly gross income. Knowing this helps you pick a sensible loan amount.
4. Check your rate with soft inquiries. Try two or three lenders, or a marketplace. Our guide to soft vs hard credit checks explains how this works.
5. Apply only for the offer you want. A full application usually triggers a hard inquiry, so save it for your best option.

If your score is lower than you would like

A lower score does not always rule you out, but it usually raises the cost. Before you borrow at a high APR, consider these options:

• Add a co-borrower. Some lenders, such as Upgrade, Happen Bank (formerly LendingClub), Achieve and Prosper, accept joint applications. Both people are responsible for the debt.
• Borrow less. A smaller amount can be easier to qualify for and cheaper overall.
• Consider a secured option. Some lenders offer secured loans. Collateral can help, but you risk losing it if you fall behind.
• Talk to a credit union. Local credit unions sometimes take a more personal view of members' applications.
• Improve your profile first. Paying down card balances and making every payment on time can help over time.

Be wary of any lender that advertises "no credit check" or "guaranteed approval." Legitimate lenders review your application before making a decision, and high-pressure, no-questions offers are often very expensive.

A hypothetical example

Imagine two hypothetical borrowers with the same credit score. One has a steady income and few existing debts. The other has a similar income but large monthly card payments. A lender may offer the first borrower a lower rate, and might decline the second or offer a higher rate. Same score, different outcomes. This is why the score alone never tells the full story.

Where to go next

Compare lenders on our personal loans ranking, learn how to weigh offers in our guide to comparing personal loan offers and see how we score lenders on our How We Rank page. If you are choosing between two lenders, try Upgrade vs Upstart or Happen Bank (formerly LendingClub) vs Prosper.

Rates, terms and approval are always set by the lender. Check your rate on each lender's site before you apply.