In this article, we’re talking about the requirements you need to meet to get a personal loan.
Overview of Major Requirements
Major personal loan requirements include:
- Being at least 18 years old
- Having a bank account
- Having a good credit history (for good terms)
- Having enough income or assets to afford monthly loan payments
Some personal loans may have additional requirements, such as collateral to secure the loan. Lenders will also look at other factors, including:
- Existing debt
- Employment status
- Housing payments
Specific Requirements
Now that you know the basics, here are some other details you should be aware of:
- Age Requirement
You must be at least 18 years old to qualify for a personal loan, as most states won’t let you enter into a binding contract until you’re a legal adult. Lenders do not offer loans to minors.
- Credit Score
You’ll need to have a credit score of 580 to 700 to qualify for a decent personal loan. However, this requirement isn’t set in stone. Having a high income might make up for a low credit score and vice versa.
- Citizenship and Residency
Many lenders require you to be a U.S. citizen or permanent resident to qualify for a personal loan. You’ll also be required to provide your Social Security number on the application. Some lenders may let you apply with an Individual Taxpayer Identification Number or a visa.
- Bank Account
Lenders usually send funds via electronic bank transfer, so you’ll need to provide your bank account information. Certain types of loans, such as personal loans secured by collateral, may not require a bank account.
- Income
You’ll need to have a steady income to prove you can repay the loan. Lenders typically don’t disclose a minimum income requirement, but you’ll need to manage monthly loan payments in addition to other expenses.
- Debt-to-Income Ratio
You probably won’t qualify if the lender determines you already owe too much money relative to your income and assets. Lenders will consider expenses, such as monthly housing costs, when evaluating your application.
- Employment
Having a stable job is helpful when applying for a personal loan, but it’s not impossible to get one if you’re unemployed. You’ll just need to provide alternative sources of income on the loan application, such as:
- Pension
- Government benefits
- Alimony
- Child support
Now that you know more about personal loan requirements, it’s time to compare your options. Click here to check out WalletHub’s picks for the best personal loans.
