If you and a partner, friend, or spouse are looking for a personal loan that you'll both use and repay, a joint personal loan may be a good choice. This type of loan allows two borrowers to get access to the funds they need while assuming equal responsibility for repayment.
LightStream is our pick for best joint personal loan lender, thanks to low rates, large loan amounts, zero fees, and same-day funding. SoFi is another good choice for people with excellent credit. If you or your co-applicant have fair credit, Upgrade offers loans for borrowers in the fair credit score range.
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Best joint personal loans
When comparing loans, consider the annual percentage rate (APR). The APR represents the total cost to borrow money, which includes the interest rate and any upfront fees, like an origination fee. Prequalify with multiple lenders to get an idea of rates you might qualify for before applying.
Prequalification is not an offer of credit and won't hurt your credit score (though your credit score may dip temporarily when you apply for a loan.) Also keep in mind that the APR and terms you qualify for will depend on your credit and financial profile, and the co-borrower's.
Methodology
Credible evaluated 31 lenders to find the best joint personal loans across 899 data points. We began by selecting only lenders that offer joint personal loans, meaning loans with co-applicants or co-borrowers. Our evaluation also included factors such as minimum and maximum interest rates, fees, funding time, loan amounts, discounts, and customer experience. Each data point was verified by a senior editor to make sure it was accurate at the time of publication.
Learn more about how Credible rates lenders by exploring our personal loans lender rating methodology.
What is a joint personal loan?
Joint personal loans, like single-applicant personal loans, are typically installment loans funded in one lump sum, meaning you receive the amount you borrow upfront and repay it according to a set repayment plan. Monthly payment amounts and interest rates on personal loans are usually fixed, which means your payment remains the same over the life of the loan.
Personal loan amounts vary by lender. Some joint personal loan lenders offer loans up to $20,000 to $50,000, but LightStream and SoFi offer maximum amounts of $100,000. Repayment terms tend to vary between two and seven years, depending on the lender and the loan's purpose.
Read more: How To Get a $100,000 Personal Loan
A joint personal loan differs from a traditional personal loan in that it has two borrowers, both taking equal responsibility for the loan and having access to the disbursed money. A joint loan may allow you to qualify for better loan terms than you would alone if both borrowers have good credit scores and debt-to-income ratios.
Joint personal loans can be a good way to share responsibility for a major financial purchase you'll both use, rather than one person taking out a loan on their own. Applying jointly may also allow you to qualify for a higher loan amount, since you'll be repaying it with two incomes.
How should I compare joint personal loans?
When you shop for joint personal loans, here are some of the most important criteria to consider:
- Co-borrower option: Not every personal loan provider lets you apply with a co-borrower. Look for banks, credit unions, and online lenders that offer joint personal loans.
- Interest rate: One of the most important factors in taking out a loan, your interest rate is a major determinant of how much your loan will cost over its lifetime. For a loan with otherwise identical terms, a 20% interest rate will cost roughly twice as much as a 10% interest rate, and for a large loan with a long repayment term, that can add up to thousands of dollars.
- Fees: Many lenders charge fees for personal loans, including origination fees, processing fees, and late fees. An origination fee is usually a percentage of your total loan amount (1% to 10% is a common range) that is taken from your loan before you receive the money. For example, if you borrow $1,000 with a 5% origination fee, the lender will automatically deduct the $50 origination fee and disburse the remaining $950 to you.
- Repayment term: This is how long you will be making your monthly payments on the loan, usually anywhere from 1 year to 7 years (or more, depending on the lender and loan purpose). Longer terms generally mean lower monthly payments, but a higher overall cost. Choose the shortest term with a payment you can comfortably afford.
- Loan amount: If you're looking for a particularly small or large personal loan, find a lender that offers the amount you need. Prequalify with multiple lenders to get a sense of how much of a personal loan you can get. If you have a low credit score, a small income, or a high debt-to-income ratio, you may struggle to find a lender that will lend you a large (or any) amount.
- Time to fund: If you need money fast, look for the lender's average funding time. Some lenders like LightStream and SoFi can send money the same day you apply, but most take 1 to 3 business days once you're approved. Things like delays in providing documentation, what time of day you apply, and your bank's policies can all impact when you receive your money.
Co-borrower vs. cosigner
Depending on the lender, a co-borrower may not be treated much differently from a cosigner. In both cases, the co-borrower or cosigner will agree to take on responsibility for the loan, and their credit score and income will help determine the outcome of your loan application.
- A co-borrower applies for the loan with another borrower and agrees to repay the loan on the same terms as the other borrower. Both borrowers have equal access to the funds.
- A cosigner, on the other hand, is more likely to step in to help you qualify for a loan, and will not be expected to use the funds from the loan or, usually, to repay it, unless the main borrower fails to do so.
If you and a partner are hoping to borrow money for a joint expense or project, a co-borrower is the correct term for the relationship.
If you are having a hard time qualifying for a loan on your own, you may want to look for personal loans with a cosigner. A cosigner with a good credit score and healthy income can help you qualify.
Learn More: Co-applicant vs. Cosigner
Pros and cons of joint personal loans
Depending on your situation, a joint personal loan might or might not be the best solution. Consider the advantages and disadvantages before you and your co-borrower decide.
Pros
- Benefits of less lender risk
- Shared responsibility for repayment
- Access to funds
Cons
- They're harder to find
- Double the applicants, double the paperwork
- The double-edged sword of shared responsibility
Pros
- Benefits of less lender risk: Since the risk assessed by lenders applies to two people (and two incomes) instead of one, a joint personal loan might be easier to qualify for and have a larger loan amount and a lower interest rate than a single-applicant loan.
- Shared responsibility for repayment: With a joint personal loan, the responsibility to repay the money rests on two people instead of just one.
- Access to funds: A joint project such as a home renovation could be easier with both co-borrowers having the ability to access the loan funds, rather than only one person controlling the pursestrings.
Cons
- They're harder to find: Not all lenders offer joint personal loans. To avoid wasting your time, check lenders' websites, and contact them if necessary, to confirm whether they accept co-applicants before you prequalify or apply.
- Double the applicants, double the paperwork: With co-applicants, lenders evaluate two sets of qualifications — credit scores, incomes, and credit histories. Consequently, it could take longer for lenders to review the application than it would with a single applicant.
- The double-edged sword of shared responsibility: Conflicts could make things complicated, not only personally but also financially. If one co-applicant shirks their responsibility to repay, it could damage both applicants' credit scores.
How do I apply for a joint personal loan?
The actual process to apply varies from lender to lender, but here are the most important steps:
- Discuss it with your co-borrower: When entering into a financial partnership, it's best to be very clear on both of your expectations. How much are you borrowing? Will you be splitting the cost of each monthly payment? Do you agree on exactly how you'll use the money?
- Check your credit scores: Check the credit scores of you and your co-borrower before applying. If one (or both) of your scores is low, take the time to boost it prior to applying to improve your chances of qualifying for a lower interest rate.
- Prequalify for multiple loans: Many lenders allow you to prequalify for a loan. This means entering basic personal information, estimated income, and other details. You can get an estimate of the rates and terms you may be eligible for and which lenders are likely to approve your application. Prequalification is not an offer of credit, and your final rate could be different.
- Compare terms: Once you have quotes from multiple lenders, compare APRs, loan amounts, repayment terms, and other factors like origination fees. You're looking for the loan with the lowest cost of borrowing, with a monthly payment you are confident you can afford.
- Apply: Once you've identified the best option, finish the paperwork to apply. At this point, most lenders will conduct a hard credit check, which could bring your score down temporarily.
- Review the loan offer: If approved, review the loan offer to make sure the rate, monthly payment amount, repayment term, and any upfront fees are as expected. If all looks well, sign to move forward.
- Prepare for repayment: Once you receive your funds, make sure you're prepared to repay your loan in full and on time. Set up automatic payments, or create a calendar reminder.
FAQ
Are you more likely to be accepted for a joint personal loan?
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How do joint personal loans impact the credit scores of both applicants?
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Can I get a joint loan with bad credit?
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Can an unmarried couple get a joint personal loan?
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What are some alternatives to a joint loan?
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