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If you need a little extra cash for an unexpected expense, a personal loan could be a good option. These loans are typically available quickly, can be deposited directly into your bank account, and you can usually pay them back with fixed monthly payments that you can plan for.
It may be difficult to find a lender that offers loans for such a relatively small amount — but they’re available. Here’s where to find a $1,000 personal loan, how to apply for one, and the credit score you typically need to qualify.
Where to get a $1,000 personal loan
Personal loan lenders have multiplied as the industry has grown. Today, you can find a personal loan from a variety of online lenders, as well as some brick-and-mortar banks and credit unions.
Lenders like SoFi, Upstart and Prosper offer the ability to take out a personal loan in a short period of time, completely online. You’ll typically go through a credit check and have the money deposited into your account within a few business days if you’re approved.
It’s a good idea to evaluate loan offers from several different lenders to find the one with the lowest interest rate and fewest fees. Even a small difference in interest rate can save you hundreds of dollars in interest over the life of the loan. With Credible, you can compare personal loan rates from multiple lenders without affecting your credit.
Banks and credit unions
Not all banks or credit unions offer personal loans, and among those that do, you may have a challenge finding one to loan you a small amount. But you may also be able to get a $1,000 personal loan by walking into a traditional financial institution, like a bank or credit union, and applying in person. If you’re an existing customer with a particular bank, you might be eligible for an interest rate discount.
Some banks and credit unions have robust online personal loan businesses similar to the ones mentioned above, including LightStream (part of Truist Bank), Marcus by Goldman Sachs and PenFed Credit Union.
How soon can you get a $1,000 personal loan?
Personal loans can often be deposited to your bank account within a few business days after final approval. You can also find a personal loan lender that can get you your cash as soon as the next business day.
To make sure you get your money as soon as possible, be on alert to answer any questions your lender has about your finances to keep the formal approval process moving along.
Credible lets you view your prequalified personal loan rates in minutes.
While they aren’t as common, some lenders even offer same-day personal loans. Same-day are intended to deliver their funds to you on the same day that you apply for them. They are also known as emergency loans and are excellent sources for funds when you need them quickly.
When considering same-day loans, evaluate the reputation of a lender. While there are trustworthy lenders that offer same-day loans, there are far more that offer predatory payday loans. Payday loans, for example, present the same benefit as a same-day loan: quick access to funds. However, payday loans typically have exorbitant fees and triple-digit interest rates, and are expected to be repaid in a short period.
How to apply for a $1,000 loan
Getting a $1,000 loan is a fairly straightforward process. Here are the steps you should take:
- Check your credit. Your credit score will help lenders determine whether you qualify for a loan, and what interest rate they’ll offer you. Higher credit scores typically yield better rates, and if your score is too low you may not be able to take out a personal loan at all. You can request copies of your credit reports for free each year from the three main credit bureaus: Equifax, Experian and TransUnion. When you get your credit reports, review them carefully to make sure all the information is correct.
- Find a lender. You can use a site like Credible to quickly evaluate different lenders and get a ballpark for the interest rates each offers. Keep in mind that not all lenders offer small loans of $1,000 — some lenders have minimum loan amounts above this point. Most lenders advertise the amounts they have available, so check to make sure you aren’t applying for more money than you need.
- Check your rates. Once you’ve found a few lenders that might fit the bill, you can fill out a short form on their websites to get a rate quote. You’ll typically need to provide some personal information, like your Social Security number. The lender will then use a soft credit inquiry to access your information, which shouldn’t affect your credit score. Based on the information in your credit report, you may receive a prequalified offer for a $1,000 loan.
- Select the best offer and apply. Evaluate each offer based on the interest rate, the length of time you have to repay the loan, and any fees that the lender charges. When you find the loan you’re happiest with, follow the lender’s instructions to complete a formal loan application.The application process will usually include providing a bit more information about your financial situation. And the lender will likely run a hard credit check at this point, which can temporarily drop your credit score by a few points.
- Receive your money. If your loan application is approved, you’ll generally receive your loan funds in your bank account within a few business days, though it can sometimes take longer depending on the lender and your bank.
What credit score do you need for a $1,000 personal loan?
Many personal loan lenders have a minimum credit score required to qualify for their loans. This score varies from lender to lender, but better scores will generally give you access to more loan offers — and the offers will typically have lower interest rates and fewer fees. Your credit score generally ranges from 300 to 850, with higher numbers representing better scores.
- A credit score of 800 to 850 is considered excellent, and a score between 740 and 799 is very good. Scores in this range will give you the best interest rate offers on a $1,000 loan.
- A score of 670 to 739 is considered good. You’ll likely have access to most personal loan offers with good credit, though your interest rate may not be quite as low as those offered to borrowers with very good or excellent credit.
- A credit score between 580 and 669 is fair. You may have a harder time finding personal loan offers with fair credit, as many lenders set minimum scores above this range. But you should still have some options for a $1,000 personal loan.
- Scores below 580 are considered bad credit. Poor credit could make it difficult for you to find a personal loan. If your score is below this range, consider spending time increasing your credit score before taking out a loan. The best way to boost your credit score is to focus on making all your bill payments on time, every time. If you can’t wait to get a $1,000 loan, you can apply with a cosigner who has good or excellent credit, which can increase your chances of loan approval. Just make sure your cosigner understands that they’ll be on the hook for repaying the loan if you aren’t able to make your payments.
How much will a $1,000 personal loan cost?
Beyond repaying the amount you borrow, you’ll pay for your personal loan in two different ways: interest and fees.
Interest is an expense you pay to the lender in exchange for borrowing money. Higher interest rates mean you pay more money to the lender. Interest rates are often expressed as an annual percentage rate, or APR. A loan’s APR takes into account both the interest and any fees, so this is a more accurate figure to look at when comparing personal loan offers.
Many personal loans also come with fees, which are one-time charges you pay the lender. One of the most common personal loan fees is an origination fee, or a percentage of the loan amount you pay in exchange for the loan. Origination fees can range from 1% to 8% of the loan amount or higher — meaning a fee of $10 to $80 on a $1,000 loan. This fee is typically taken off the top, reducing the amount you actually receive.
Making late payments may also cause you to incur a late fee. You can also be charged an insufficient funds fee if your bank account doesn’t have enough money to cover your monthly loan payment.
The best personal loans won’t come with origination fees, and some don’t have any fees at all.
What’s the monthly payment on a $1,000 personal loan?
Your monthly payment on a $1,000 loan will depend on the interest rate you receive and your repayment term. The lower your rate, the less your monthly payment will be. Also, the longer your loan term, the lower your monthly payment will be — though you’ll end up paying more in interest in the long run.
If you have good credit, and qualify for a 10% interest rate, here are some examples of what your monthly payment could look like:
- If you choose a one-year term, your monthly payment would be $88 and you’d pay only $55 in interest.
- If you have a three-year term on your loan, that means your monthly payment would be $32. Over the life of the loan, you’d pay $162 in interest.
- With a five-year term, your payment would go down to $21, but you’d pay a total of $275 in interest on your $1,000 loan.
With fair credit, you may pay a much higher interest rate — say, 17%.
- A one-year term would run you $91 per month, and you’d pay a total of $94 in interest over the course of the year.
- With this rate and a three-year term, your monthly payment would be $36 and you’d pay a total of $283 in interest.
- A five-year term loan would cost you $25 per month, with a total of $491 in interest.
If you’re ready to apply for a $1,000 personal loan, visit Credible to compare personal loan rates from various lenders, all in one place.
Personal loan FAQs
Here are some answers to commonly asked questions about personal loans.
How fast can you get a small personal loan?
Many personal loan lenders advertise that their applications take just a few minutes and offer instant decisions. This may be true, but it generally takes a bit longer until you actually get the money you’ve borrowed. Some lenders are able to get your money to you the next business day, though it can take a few business days in many cases.
What can you use a personal loan for?
Personal loans have few restrictions on what you can use them for. Many people use personal loans to consolidate high-interest debt, like credit cards. You can also use a personal loan to cover an unexpected or emergency expense like a car repair bill, to pay for a wedding or vacation, or to pay off medical debt.
You’re generally not allowed to use a personal loan for any illegal activity, gambling, or to pay for education expenses.
What are the requirements for a personal loan?
Eligibility requirements can vary from lender to lender, but to be eligible for a personal loan, you generally must:
- Be at least 18 years of age.
- Live in the U.S. as a citizen or permanent resident. Some visa holders may qualify.
- Have enough income to repay the loan.
- Maintain a bank account.
- Meet lender requirements, such as minimum credit score.
Can I repay a personal loan early?
Some lenders charge prepayment penalties for zeroing your loan balance before your loan term expires. However, prepayment penalties aren’t common with personal loans. Research your lender’s fees as well as its terms and conditions to avoid unwanted costs.
By repaying a personal loan early, you can:
- Get you of debt faster
- Save money on interest
- Reduce your debt-to-income ratio
- Improve your credit score
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