Looking for loans going from one bank to another is a real hustle. As online lenders are providing many opportunities nowadays, it’s worth giving them a shot for your own comfort too. But which one to choose? That can be another hustle!
That’s why we have gathered some online installment financing platforms so that you can choose one that fits your criteria.
So, let’s dive into the article to learn about online loans with low monthly payments!
What are the Best Online Loans with Low Monthly Payments?
Taking an online loan can be a headache. It’s hard to find a secure monthly payment loan if you are new in this area. But fear not, we got you!
Let’s read below to see a list of promising online loan providers and their details.
Sofi: Best for Large Loans
SoFi stands out as an exceptional affiliate program offering a diverse range of financial services, including student loan refinancing, mortgages, personal loans, investing, and banking. Their comprehensive suite of products caters to individuals seeking to enhance their financial well-being.
Wondering if SoFi is the right fit for you? Well, here’s the scoop: SoFi lets you apply for a loan starting from as little as $5,000 and going all the way up to $100,000. This flexibility makes it an excellent choice, especially if you’re eyeing larger expenses. Unlike many other lenders capping at $50,000, SoFi steps up the game.
What sets SoFi apart is your freedom to choose between variable and fixed APRs. This is a tad uncommon since many lenders stick to fixed rates only. With variable rates, you can ride the waves of potential savings if the APR dips. But, a word of caution – it might also go up. On the flip side, fixed rates mean a steady interest rate throughout your loan term, making it a breeze to budget for repayment.
Here’s the cherry on top: SoFi sweetens the deal with a 0.25% APR discount for signing up for autopay, and there are no late fees or prepayment penalties. Once you’ve applied and got the green light for a SoFi personal loan, your funds will be at your fingertips within a few days of sealing the deal. Easy peasy, right?
SoFi also prioritizes the security of its users through advanced online security measures, ensuring a safe and protected financial environment. The platform employs robust encryption protocols to safeguard sensitive information, and its systems undergo regular audits and updates to stay ahead of potential threats.
Qualification:
- Minimum credit score: 680 for SoFi loan eligibility.
- Age requirement: Applicants must be at least 18 years old.
- Citizenship/residency criteria: U.S. citizenship or meeting specific immigration/residency requirements.
- Employment conditions: Approval for those with a job or job offer starting within 90 days.
- Financial criteria: Adequate monthly income and acceptable current debt levels are needed for approval.
Pros:
- No fees: Origination, early payoff, or late fees.
- Unemployment protection.
- DACA recipients can apply with a creditworthy co-borrower by calling 877-936-2269.
- Multiple simultaneous SoFi loans allowed (state-dependent).
- Job offer acceptance within 90 days considers income proof.
- Flexible applications for co-applicants.
Cons:
- U.S. visa holders need over two years remaining for eligibility.
- Co-signers are not permitted, only co-applicants are accepted.
Upstart: Best for Low or No Credit Score
Upstart is an online lending platform that links borrowers with banks and credit unions to secure personal loans, offering a quick financing option with swift approval and funding.
However, it does have some limitations. Upstart doesn’t provide joint, co-signed, or secured loans, and it offers just two repayment term options.
What makes Upstart unique is its special underwriting model, which uses artificial intelligence and unconventional data like educational background, job history, and residence to assess borrower eligibility.
Unlike traditional lenders such as banks, which mainly focus on credit reports, debts, income, and assets, Upstart takes a more holistic approach to qualify borrowers. And the loan term significantly influences monthly payments.
Upstart provides borrowers with options for different loan terms, allowing them to tailor their repayment schedule to match their financial goals. Opting for a shorter loan term typically results in higher monthly payments but may lead to lower overall interest costs. On the contrary, longer loan terms offer lower monthly payments but may accrue more interest over the life of the loan.
Upstart also implements secure data storage practices and regularly updates its security protocols to stay ahead of evolving cyber threats. Additionally, the platform educates users on best practices for maintaining their online security, promoting a safe and trustworthy borrowing environment.
Qualification:
- U.S. citizenship or permanent residency is required.
- Minimum age of 18 in most states.
- Valid email address and Social Security number necessary.
- Full-time job or starting one within six months.
- Bank account at a financial institution with a routing number.
- Minimum credit score: 300 in most states
- Minimum annual income: $12,000.
Pros:
- Alternative Data Use
- Fast Funding
- Soft Credit Check
- Payment Date Flexibility
Cons:
- Limited Repayment Terms
- Origination Fee
- Limited Loan Options
Upgrade: Best for Building Credit
Upgrade personal loans are designed for individuals with lower credit scores who are looking to simplify their debts while working on improving their credit. What sets Upgrade apart is its inclusive approach, offering lending services to a diverse range of borrowers.
The standout feature is the relaxed criteria for minimum credit scores, credit history, and debt-to-income ratios, making it more accessible for those with lower credit scores (629 or below).
The borrower-friendly approach of Upgrade brings attention to specific advantages, including discounted interest rates, direct settlement of debts for consolidation loans, and extended repayment terms for home improvement loans.
These features are particularly notable, considering they are not commonly found among lenders focusing on individuals with lower credit scores.
The upgrade also regularly updates its security infrastructure to stay ahead of potential threats and ensures secure data storage practices. Users can trust that their personal and financial information is handled with the utmost care, contributing to a safe and reliable online lending experience.
Qualification:
- Minimum Credit Score: 560 is the threshold for eligibility.
- Minimum Number of Accounts on Credit History: A single account is required to meet the criteria.
- Maximum Debt-to-Income Ratio: The ceiling is set at 75%, encompassing the applied-for loan.
- Minimum Length of Credit History: A minimum of two years of credit history is necessary.
- Minimum Income Requirement: There is no specific income requirement, with acceptance of income from various sources such as alimony, retirement, child support, Social Security, and others.
Pros:
- Opportunity for secured and joint loans.
- Numerous rate discounts.
- Convenient mobile app for managing loan payments.
- Direct payment to creditors for debt consolidation loans.
- Longer Repayment Terms for Larger Loans.
Cons:
- Need origination fee
- No flexibility to choose your payment date.
LightStream: Best for Fast Funding
LightStream is a great choice for people with good credit or better, offering low-interest loans with flexible terms. If you have an excellent credit score, you get access to the best interest rates available.
This lender caters to various personal loan needs, except for higher education and small business financing. The application process is straightforward – submit your application during a banking business day, get approval, electronically sign your loan agreement (no need to visit a physical branch), and verify your direct deposit banking account information by 2:30 p.m. ET to receive funds on the same day.
Even if you miss the deadline, you can still get your funds on the next business day, making it convenient for those who need quick funding.
What makes LightStream stand out is its commitment to being transparent and customer-friendly. They don’t burden borrowers with origination, administration, or early payoff fees, making things simpler for you. Plus, the repayment terms range from 24 to 144 months, offering some of the longest options available.
LightStream emphasizes security in online transactions, ensuring a safe financial environment. The predictability and affordability of monthly payments add to the borrower’s experience, providing a sense of financial control and stability.
They also help you understand how the loan term affects monthly payments, empowering you to make informed decisions. LightStream goes beyond just providing loans; they become your partner in personalized financial solutions.
Qualification:
- Minimum credit score of 660, but may vary based on the loan purpose.
- Substantial credit history with diverse account types.
- Demonstrated strong payment history with minimal or no delinquencies.
- Maximum allowable debt-to-income ratio of 50%.
- Evidence of financial stability through investments, retirement savings, or other savings capabilities.
- Sufficient income to cover existing debts and the proposed LightStream loan.
Pros:
- Offers a 0.50 percentage point rate discount for automatic payments.
- No fees for loan origination, late payments, or prepayment.
- Wide range of repayment terms (two to 12 years) based on loan purpose and amount.
- Funding delay option of up to 90 days for better project coordination.
Cons:
- No Direct Pre-Qualification
- No Direct Payment to Creditors
- High Minimum Loan Amount, starts at $5000
Lending Club: Best for Debt Consolidation
LendingClub specializes in tailoring personal loans to individuals with good to fair credit, offering a compelling solution for those looking to consolidate debts or fund substantial purchases. Notably, LendingClub’s commitment to flexibility is evident through its accommodation of joint loans, providing borrowers with versatile options.
While origination fees are part of the equation, LendingClub shines as an exceptional choice for individuals focused on streamlining their debts, thanks to its advantageous features. Beyond just a rate discount, the lender distinguishes itself by facilitating direct payments to creditors for those utilizing debt consolidation loans.
In addition to its commitment to flexibility, LendingClub places a strong emphasis on security in online transactions, ensuring a safe financial environment for its users. The predictability and affordability of monthly payments further enhance the borrower’s experience, fostering a sense of financial control and stability.
Moreover, LendingClub understands the importance of considering the loan term in relation to monthly payments. By offering insights into how the loan term affects these payments, the lender empowers borrowers to make informed decisions that align with their financial goals. Whether consolidating debts or embarking on significant financial endeavors, LendingClub positions itself as a dependable and supportive partner, ensuring a secure, predictable, and affordable financial journey for its users.
Qualifications:
- Minimum Credit Score- 600.
- Minimum of 36 months of credit history with at least two accounts.
- Debt-to-Income Ratio- maximum 40% for both individual and joint applications.
- Minimum Annual Income, borrowers must provide proof of income.
Pros:
- Debt Consolidation Support
- Joint Loan Options
- Soft Credit Pull for Pre-Qualification
- Payment Date Flexibility
- Member Center Insights
Cons:
- Origination Fees
How to Compare Online Loans?
Before committing to the first online loan that comes your way, take a moment to prequalify for multiple options and consider the following factors:
APRs (Annual Percentage Rates):
Think of APRs as the total cost of your loan, encompassing both interest and associated fees. Lower APRs translate to more affordable loans. Lenders often reserve the best rates for borrowers with excellent credit, as they pose the lowest default risk.
Fees:
Pay attention to any origination fees, an upfront deduction from your loan funds that many loans carry. Some loans might even have prepayment penalties for settling your loan early. Also, be mindful of potential late fees and check payment fees.
Funding Timeline:
Different lenders operate on varying timelines for fund disbursement. If you’re in need of quick funds, consider lenders offering same-day or next-day loans for added convenience.
Loan Amounts:
Personal loans online come in various sizes, typically starting around $1,000 and potentially reaching up to $200,000, depending on the lender and your credit score. Ensure your chosen lender offers the amount you require before initiating the application.
Repayment Terms:
Consider the repayment term, which dictates the duration for repaying the borrowed amount. Longer terms result in lower monthly payments but may accrue more interest over time. Conversely, shorter terms mean higher monthly payments but lower overall interest costs.
Customer Reviews:
Don’t overlook the significance of customer reviews. In the event of any issues with your loan, reliable customer service becomes crucial. Take the time to read reviews to gauge the lender’s responsiveness and support before making a commitment.
By prequalifying and diligently comparing these factors, you empower yourself to make an informed decision, ensuring that the loan you choose aligns with your financial needs and preferences.
Bottom Line
Installment loans provide a financial solution where you repay borrowed funds through equal, manageable portions over a set period. Particularly beneficial for those with a less-than-ideal credit history, these loans offer a safer and more cost-effective alternative to payday loans.
The structured repayment plan not only makes it easier to manage but also reduces the financial risk associated with lump-sum payments. This makes installment loans a practical and accessible choice, promoting responsible borrowing while accommodating individuals facing credit challenges.
