Best Personal Loans for Good Credit in December 2024

• The best personal loans for good credit are from Upgrade, thanks to fast funding, competitive interest rates, and loan amounts up to $50,000.
• SoFi and Discover are also strong options, especially if you have very good or excellent credit.

Having good credit can make it easier to get approved for a personal loan and qualify for a low interest rate. For example, applicants with good credit prequalified for interest rates in the low teens to around 20% in November 2024, according to Credible loan data, while applicants with fair credit saw rates closer to 30%.

Good credit has the potential to get you better rates to to refinance high-interest credit card debt, pay for a large purchase, make home improvements, or cover an emergency expense. Just be sure to compare lenders and rate quotes to get the best personal loan for your needs.

Why you can trust Credible

The Credible editorial team is independent and unbiased, which means that partners do not influence our editorial content. To help you find the best personal loan for good credit, we analyzed over 800 personal loan data points. Using data-driven methodologies, we scored criteria that are important to you. This approach allows us to objectively rank personal loans. To learn more, read our methodology below.

Best personal loans for good credit

Methodology

Credible evaluated 30 lenders to find the best personal loans for good credit. Our team of experts considered internal proprietary data, including prequalification rates by lender, credit score minimums, and approved loan purposes. We also gathered information from each lender's website, customer service department, directly from our partners, and via email support. We chose the best lenders based on the following weighted categories:

• Rates and fees: 18%
• Loan terms: 18%
• Customer experience: 17%
• Eligibility: 14%
• Customer satisfaction: 10%
• Efficiency: 10%
• Options for poor credit and no credit: 9%
• Discounts: 4%

Each data point was sourced and verified by a senior editor to make sure it was accurate and up to date. Learn more about how Credible rates lenders by exploring our Personal Loans Lender Rating Methodology.

What is a good credit score?

Your credit score is a three-digit number that provides a snapshot of your creditworthiness. Lenders use it to predict how likely you are to repay loans on time. FICO is a commonly used credit scoring model and ranges from 300 to 850.

A good credit score is considered a FICO score of 670 or higher. Not only do your odds of loan approval improve with a good credit score or better, but you're also more likely to qualify for lower interest rates. 

Your interest rate affects the overall cost of a loan. Scoring a lower interest rate means you'll end up paying less in interest charges over the life of your loan.

What are good credit loans and how do they work?

A good credit loan is a personal loan issued to applicants with a good credit score. Your credit score and overall credit profile play a significant role in determining whether a lender approves your loan application. Typically, lenders reserve their lowest interest rates for applicants with good to excellent credit. Borrowers with good credit resent less of a risk to lenders.

Good credit loans work just like other personal loans. When you apply, the lender looks at your credit and other factors, like income, employment history, and debt-to-income ratio (DTI). If you're approved and agree to move forward with the loan terms, the lender disperses the loan funds, either directly to a linked bank account or directly to a creditor, depending on your preference.

Pros and cons of personal loans

Personal loans can be a valuable tool to fund your financial goals. With the advantages, though, come some potential drawbacks to consider as well:

Pros

• Fixed rates: Personal loans often have fixed interest rates, which means predictable monthly payments that make budgeting easier.
• Flexible loan amounts: Lenders offer flexible borrowing amounts, letting you take out only what you need without overcommitting financially.
• No collateral: Most personal loans are unsecured, so you won't need to put up an asset like a car or home to get approved.
• Multi-purpose: Personal loans can be used for a wide range of expenses, including debt consolidation, home improvements, emergency expenses, and more.
• Fast funding and loan approval: Most personal loan lenders can send money directly to your bank account within days of your application. Some can even send money the same day you apply.
• Flexible repayment terms: If you need a lower monthly payment, a longer repayment term can get you there. Most personal loan lenders offer repayment terms of up to 5 years, but some offer 7-year terms or longer.

Cons

• High rates relative to secured loans: Since the lender has no collateral to offset its risk on an unsecured loan, most personal loans have higher rates than secured options like home equity loans and home equity lines of credit.
• Origination fees: Some lenders may charge origination fees, which can increase the cost of borrowing and reduce the amount you receive.
• Payments aren't flexible: Your loan amount, interest rate, and terms are locked in once you sign a loan agreement and until the repayment period ends or you pay off your loan.
• Increased debt: Taking on additional debt can increase your DTI and make it harder to qualify for loans in the future.

Average personal loan rates for good-credit borrowers

Having good credit can help you qualify for lower interest rates. Many lenders offer personal loans with an interest rate range based on creditworthiness. They often reserve their lowest rates for individuals with good to excellent credit and those who meet other underwriting criteria.

As mentioned earlier, a good credit score is a FICO score of 670 or higher. Even if you have good credit, interest rates can vary depending on where your score falls on the scale. Below are the average interest rates by credit score on three-year and five-year personal loans based on Credible data:

Locking in the lowest-possible interest rate can save you considerable money in interest charges, lowering the overall cost of your loan.

How to get a good credit personal loan

While having good credit is a great start, you'll need more than a solid FICO score to secure a low interest rate.

1. Research and compare lenders

Once you've prequalified, compare annual percentage rates (APRs) between lenders, along with repayment terms, loan amounts, and fees, like origination fees. APRs account for interest rates and upfront fees, so they're a better measure of a loan's true cost than the interest rate alone.

Keep in mind that origination fees, when charged, are typically deducted from the loan amount upfront, meaning you'd receive a lesser amount than what you applied for.

2. Pick a loan option

After comparing lenders, choose the loan option that pairs monthly affordability with overall loan cost and provides the loan amount and repayment term you need.

3. Complete the application

Once you've picked a lender, you'll need to fill out a full application and submit any required documentation by the lender, such as pay stubs or tax returns. Additionally, you'll need to submit to a hard credit check which may temporarily lower your score.

4. Get your funds

If you're approved, the lender will have you sign for the loan so the money can be released to you. Review the loan documents carefully to ensure the terms are as expected. Once signed, the lender can send funds to your account or to your creditors if you're getting a debt consolidation loan.

The time to fund a personal loan typically takes two to three business days, once approved - though some lenders offer fast personal loans that can be funded as soon as the same or next business day after approval.

Learn More: How To Get a Personal Loan

Use our personal loan calculator to estimate how much you'll pay for a loan.

How to compare personal loans for good credit

When you have good credit, you have access to competitive personal loan options. Here are some key factors to consider before making your choice:

• Interest rates: Compare interest rates from multiple lenders before applying for a loan. Lower interest rates mean lower overall costs for your loan. Many lenders let you check rates before applying without affecting your credit.
• Fees: Some lenders charge fees on personal loans. Check to see if a lender charges origination, late payment, or prepayment penalties. These fees can add to your cost.
• Loan amounts: Loan amounts can vary between lenders, with some offering much higher limits than others. Make sure the lender offers the loan amount you need.
• Repayment terms: Look at the repayment periods offered by lenders you are considering. Shorter terms mean higher monthly payments but less interest overall. Longer terms lower monthly costs but increase the total interest paid.
• Customer service: Choose a lender with a reputation for providing excellent customer support. Consider your preference for communication with lenders and find out if the lender offers that kind of service. You want a lender that will be helpful and responsive if you have questions or issues with your loan.

Learn More: How To Compare Personal Loans

Will a personal loan boost my credit score?

Yes, a personal loan can increase your credit score if managed responsibly. According to TransUnion, most borrowers who used a personal loan to consolidate debt saw a credit score increase of 20 points or more.

Here are a few key ways that getting a personal loan can help your score:

• Maintaining a positive payment history: Payment history is the largest factor that determines your credit score (35%). This is why choosing an affordable payment is often more important than choosing the lowest-cost loan.
• Lowering your credit utilization ratio: Your credit utilization is the amount you owe on revolving credit lines - such as credit cards - compared to your limits. If you use a personal loan to consolidate credit card debt, you could reduce your credit utilization ratio and see improvements to your credit score within one month.
• Diversifying your credit mix: Lenders like to see that you can handle multiple types of credit - which is why carrying different types of debt can raise your credit score. Adding a new personal loan could improve your credit mix, especially if you don't have another type of installment loan on your report.

Note that when you apply for a personal loan, the lender will perform a hard credit check to estimate how likely you are to repay the loan. This could cause your score to drop slightly - usually five points or less. This effect is temporary, and your credit score could bounce back within a few months to no longer than one year.

Alternatives to personal loans [for people with good credit]

Instead of a personal loan, you may want to consider a personal line of credit, a credit card (especially if you can qualify for a 0% APR offer), a home equity loan, or a home equity line of credit (HELOC).

Lines of credit

A line of credit is a type of revolving credit account that allows you to borrow money when you need it. You can get an unsecured line of credit from some banks or apply for a HELOC to tap the equity in your home. Each functions similarly, but a HELOC may have a lower APR and higher credit line available. It may also offer longer repayment terms.

In general, here's how they work. Once you're approved for a credit line, you can draw from it as needed during the draw period. Lines of credit may have a defined draw period and repayment period, or a continuous draw period:

• Draw period: The time during which you can use the line of credit. Interest-only payments may be required.
• Repayment period: Once the repayment period begins, you can no longer use the credit line and will pay off the balance in installments over a period of years.
• Continuous draw period: Not typically available on HELOCs, a continuous draw period means you can keep using the line of credit, similar to a credit card.

Lines of credit, including HELOCs, typically have variable interest rates. How large a credit line you qualify for will depend on your credit, income, and current debt. 

In the case of a HELOC, the lender will also consider how much available equity you have to set your limit. Lenders typically require that you have at least 20% available equity to qualify.

Home equity loan

Like a HELOC, a home equity loan lets you tap your home's equity, and the home is used as collateral. You'll need at least 20% available equity to qualify, or a loan-to-value ratio (LTV) of less than 80%. Instead of a line of credit, you'd receive a lump sum upfront that's repaid over a period of years.

Because they're a type of secured loan, rates on home equity loans tend to be lower than personal loan rates, often coming in around 8% or 9% APR, depending on your credit, income, and LTV.

In addition to the collateral requirement, it can take a month or more to get approved for a home equity loan and receive loan funds. This can be a good option if you've built a large amount of equity and need more than what you'd qualify for with a personal loan. Plus, if you use the funds to improve your home, you may be able to deduct the interest on your taxes.

Compare: Personal Loan vs. Home Equity Loan

Credit card

If you need long-term financing, a credit card is rarely a good option. The average credit card rate was 21.76% APR compared to 12.33% APR for a two-year personal loan, according to Federal Reserve data. However, there are a few instances when using a credit card could be a better option:

1. You can qualify for a 0% APR promotion: If you have good credit, it's likely that you're eligible for a card with a 0% APR on new purchases and balance transfers. Keep in mind that transfers often come with a fee from 3% to 5%. Promotions may last from 12 to 21 months or more. If you can pay off the balance within that time, you can essentially get an interest-free loan.
2. You can pay off the balance within the card's grace period: One great thing about credit cards is that most have a grace period of one billing cycle, during which time you won't be charged interest on purchases. If you can't however, the purchase will be charged interest at the card's standard APR, which could be near 30%.
3. You plan to refinance credit card debt: If you're eligible for a 0% APR promotion but can't pay off the balance within the promotional period, you might consider using a personal loan to refinance the debt before the APR adjusts. This is not necessarily recommended since there's no guarantee you'll be able to qualify for debt consolidation.

Learn More: Personal Loan vs. Credit Card

Read More:

• Best Loans for Bad Credit
• Best Loans for Fair Credit
• Best Loans for Excellent Credit
• Best Banks for Personal Loans
• Best Credit Unions for Personal Loans
• Best Online Personal Loans