When you need access to extra money, borrowing from a financial institution like a bank is one of the easiest ways to get it. But not everyone is eligible for bank loans. If you have bad or non-existent credit, for example, traditional lenders may not extend you enough money. Fortunately, there are other options for those looking for small personal loans. Here we will look at how to get small personal loans from private lenders, alternative lenders, or even from family and friends.
Private Lender Small Personal Loans
Private lenders are regulated by some form of government agency, so they can provide legal personal loans. Private lenders often offer competitive rates and flexible payment plans. Here are some of the best sources of small personal loans from private lenders:
Peer-to-Peer Lenders: Peer-to-Peer (P2P) Lenders are popular with those looking for small personal loans. This method of lending matches people with money to lend to those looking for money to borrow in an online marketplace. One popular P2P lender is Lending Club. Their interest rates can range from 6.95-35.89% APR, and loan amounts vary from $1,000 to a maximum amount of $35,000.
Credit Unions: Credit unions are non-profit organizations that offer lower interest rates and fees to members than banks. Credit Unions might offer a lower interest rate than other types of private lenders, though the loan amount may be lower as well.
Online Lenders: Online lenders provide small personal loans to people with bad credit, inadequate collateral, or in need of a fast loan. They offer easier applications and speedy approvals, but the interest rates can be quite high.
Alternative Lenders
Some of the best places to get small personal loans are alternative lenders. These lenders offer short-term installment loans and are more likely to lend to those with low credit scores or no credit. Each lender has its own rules as to what loan amounts and interest rates they offer, so it’s important to do your research. Here are a few of the most trusted alternative lenders offering small personal loans:
OppLoans: OppLoans offers loans from $1,000 to $4,000 with repayment terms from 3 to 24 months. OppLoans interest rates range from 59-199% APR and the company website has reviews from satisfied customers.
LendUp: LendUp offers small personal loans ranging from $100 to $1,000 with repayment terms from 7 to 30 days. Loan amounts can increase as you apply for new loans and repay existing ones, as the lender builds trust in your ability to pay back.
RISE Credit: RISE Credit provides small loans of up to $1,000 with repayment terms up to 26 months. However, they have higher interest rates ranging from 36-299% APR.
Family and Friends
When all else fails and you are looking for a small personal loan, family and friends are often your best bet. Considering the potential embarrassment, awkwardness, and risks associated with borrowing money from family or friends, you should have a plan in place to ensure the loan will be paid back. It is always important to be clear about terms of repayment prior to accepting any small personal loan from a friend or family member.
No one wants to be in a financial bind, but small personal loans can help get you back on track. Understanding which lenders are best for small personal loans can save you time and money. Private lenders like credit unions or peer-to-peer (P2P) lenders offer competitive rates and flexible payment plans, while alternative lenders and borrowing from family and friends can provide you with a personal loan when your credit score isn’t the best. Being aware of all the options will help you determine the best loan for your personal situation.
