Banks, credit unions, online banks, and other lenders offer personal loans. You can use them for various purposes, such as debt consolidation, home repairs and improvements, and large purchases.
These loans are often unsecured, meaning you don’t have to provide collateral for approval. But this makes them riskier for lenders, many of which require good to excellent credit and have income or debt-to-income (DTI) requirements.
An unsecured $1,000 personal loan may be the right choice for you—and you might even qualify for a loan with less-than-perfect credit. Here’s what to know about $1,000 personal loans and how to get one.
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Many lenders offer personal loans in different amounts. However, personal loan limits vary. Some lenders offer personal loans of $100,000 or even higher.
If you’re approved for a personal loan, the lender’s quote will be personalized to you. It will use various factors to determine your loan amount and interest rate, including your credit score, income, DTI, and employment history.
Your quote will contain an annual percentage rate (APR), which is comprised of the following loan components:
Be sure to avoid predatory lenders, which are known for charging excessive APRs and using aggressive sales tactics. Instead, consider these lenders for a $1,000 personal loan.
Lender | Rates (APR) | Loan amounts |
Credible | 7.49% – 35.99% | $600 – $200,000 |
Upgrade | 8.49% – 35.99% | $1,000 – $50,000 |
Upstart | 7.80% – 35.99% | $1,000 – $50,000 |
LendEDU rating: 5.0 out of 5
Credible is our favorite marketplace for comparing personal loans because of its straightforward and efficient process, which allows users to find the best loan options. We also like the platform for its transparency. Users can easily compare loan terms from various lenders without worrying about hidden fees.
For individuals valuing time and ease of use, Credible is an exceptional choice. The platform’s ability to aggregate offers from multiple lenders in one place not only saves time but also ensures borrowers can make quick, informed decisions.
LendEDU rating: 4.9 out of 5
Upgrade is a terrific option if you have a FICO credit score in the 580 to 669 range. It presents an opportunity to obtain a loan at fair rates. This inclusivity is a significant advantage, making Upgrade a viable option for a wider range of borrowers.
Beyond lending, Upgrade’s free credit monitoring service is a standout feature, offering borrowers tools to understand and improve their credit scores over time. The addition of hardship plans underscores Upgrade’s commitment to supporting borrowers during financial difficulties, highlighting its role not just as a lender but as a financial partner.
Upgrade charges an origination fee, which is standard for borrowers with less-than-stellar credit. But if you have a credit score of 670 or better, you might be able to avoid an origination fee altogether by applying with a lender that targets good-credit borrowers.
LendEDU rating: 4.8 out of 5
Upstart is a revolutionary lending platform that offers more than just traditional credit evaluations, making it an excellent choice for those with minimal credit history. By considering a borrower’s education and employment background, Upstart acknowledges the potential beyond what a credit score can show.
This broader assessment approach can benefit those who are new to credit or have been disadvantaged by conventional credit scoring methods. Quick funding times enhance the appeal, providing financial relief when it’s needed most.
The absence of prepayment penalties affords borrowers the flexibility to manage their loans without extra costs, further solidifying Upstart’s position as a forward-thinking and borrower-friendly platform. Like Upgrade, Upstart charges an origination fee.
A $1,000 personal loan can be useful for many purposes, but not everyone will qualify. Ideally, you should have a good credit score (at least 670 on FICO’s scoring model), which will show you have used credit responsibly in the past.
A higher income and lower DTI can also help you qualify. The goal is to show the lender you’re a responsible credit user who will be able to repay the loan. There are no hard-and-fast rules here, but better numbers will improve your chances.
To get a $1,000 personal loan, follow these steps:
Once you review and sign the agreement, you expect to get your money within a few business days. In some cases, same-day funding might be available.
Repaying a $1,000 personal loan is straightforward, assuming you have the money to cover at least the minimum payment. For a loan this size, the typical repayment lasts a few months to a few years. Payments are often fixed at regular monthly intervals.
“Fixed” means the minimum amount you must pay will remain the same for the life of the loan. In other words, the payment will be the same every month unless you decide to pay more. Each payment will cover a portion of the original loan amount plus interest.
Here are a few ways to potentially pay less overall on a personal loan:
As you may have noticed, the common theme is to pay more than the minimum. This is often the best way to save with a personal loan.
Several factors affect the payments on a $1,000 personal loan. For instance, a higher interest rate means paying more over the life of the loan and potentially higher payments. A longer loan term can result in smaller payments (but more interest).
Here are two examples of $1,000 loans with different rates and terms:
Loan 1 | Loan 2 | |
Terms | 12 months | 36 months |
Interest rate | 12% | 15% |
Monthly payment | $88.85 | $34.67 |
Total interest | $66.19 | $247.95 |
Loans with longer terms often have higher interest rates because this can increase the chance you won’t be able to pay the loan back. The second loan’s payment is much lower, but it results in far more interest.
Borrowing $1,000 with a personal loan can be useful for many purposes. However, like all forms of lending, it has pros and cons.
Pros
Can be easier to qualify for than other forms of credit
Usually few restrictions on how you can use the money
Fixed payments result in a predictable repayment schedule
Potential to help build credit
Cons
Interest rates can be higher on smaller loans, leading to a high borrowing cost relative to the principal
Some lenders charge origination fees, processing fees, and other fees that can increase the cost to borrow
The ease of taking out a personal loan can make it tempting to overspend, leading to a debt cycle
Some lenders have minimum loan amounts above $1,000
A personal loan can be an excellent way to borrow $1,000. If you need quick access to a smaller amount, have good credit, and earn the income to repay it, this could be the right option.
Remember that any lending product can lead to a debt cycle if you can’t pay, and it could damage your credit history. Weigh the pros and cons before proceeding.
Personal loans can be useful, but they aren’t the only way to borrow $1,000. You might consider these alternatives in some situations, such as when you want to avoid interest.
Here are a few possibilities:
If you can’t qualify for a personal loan on your own, one potential option is to use a cosigner or co-borrower. With this arrangement, someone with good or excellent credit signs on to the loan, which can help you qualify.
However, keep in mind that the cosigner will be responsible for the loan. If you miss a payment, it will damage your and their credit history. If your cosigner is a friend or family member, it will be similar to borrowing money from them. In either case, failing to pay can damage your relationship with the person.
The minimum credit score required may vary by lender. However, a credit score of 580 or higher can be sufficient for a $1,000 personal loan from several lenders. Remember, the higher your credit score, the better your terms are likely to be.
Yes, you can. While traditional income sources can make the process easier, it’s possible to get a loan if you’re self-employed or have irregular income. You just might need to provide additional information or documentation.
Once approved, most lenders can deposit a personal loan into your bank account within a few business days. Some might even offer instant funding.
Generally, personal loans can be used for a wide range of purposes. However, it’s always wise to check with lenders for any specific restrictions.
Missing a payment can result in additional fees, increased interest rates, and harm to your credit score. If you’re having trouble making payments, contact your lender as soon as possible.
It’s rare, but some lenders might charge a prepayment penalty for paying off a loan ahead of schedule. Check with your lender for its specific policies.
Interest rates for personal loans are based on factors such as your credit score, income, loan term, and the lender’s current rates.
Lender | Rates (APR) | Loan amounts |
Credible | 7.49% – 35.99% | $600 – $200,000 |
Upgrade | 8.49% – 35.99% | $1,000 – $50,000 |
Upstart | 7.80% – 35.99% | $1,000 – $50,000 |
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