Best personal loans for students in 2024

Federal and private student loans should be your first choices, apart from grants and scholarships, when considering how to fund your education. But if unexpected expenses arise during the school year, you may need to find another way to pay for them. You can’t usually use a personal loan to pay for tuition, but you may be able to use one to pay for costs of living like food, transportation, and housing, and emergency expenses like a car repair or vet bill.

Compare personal loan rates

Best personal loans for students

Personal loan interest rates tend to be much higher than rates on student loans, especially if you haven’t built a credit history. Prequalify with multiple lenders to see what rates you might be eligible for, and if you're likely to get approved for a loan. Applying with a cosigner, such as a parent, might be an option to improve your approval odds and lower your rate. 

(Note that prequalification is not an offer of credit, and it won't impact your credit score. When you apply for a loan though, the lender will conduct a hard credit pull, which could ding your score temporarily.)

What are personal loans?

Personal loans are a type of installment loan. You receive the loan amount as a lump sum upfront, and pay it back in monthly installments over a period of time, often one to seven years. Rates are usually fixed, which means your monthly payment won’t change. But unlike student loans, there’s no deferment period while you’re in school. Repayment begins immediately. Also unlike student loans, personal loans have more strict eligibility requirements, which could make getting one as a student tough.

For example, many lenders have minimum income requirements and require that you have a FICO score of at least 600 as well. That can be a tall order for if you’re a student with only a few student loans on your credit history and no job. However, if you do have a part-time job, and have built up some credit, you might qualify for a personal loan as a student.

But even if you qualify, there are other things to consider before getting a personal loan.

Student loans vs. personal loans

To help you understand how personal loans work, let’s compare them to student loans. (APRs below are from the Federal Reserve and Credible student loan rates data.)

How to compare personal loans for students

When comparing lenders, consider the following:

• APR ranges
• Minimum and maximum loan amounts
• Lender credit requirements
• Available loan terms
• Fees (including origination fees, late fees, and returned check fees)
• Lender reputation
• Additional loan features, like whether the company has a mobile app

Before applying, prequalify with multiple lenders to get a sense of rates and terms you might qualify for. 

How do personal loans for students work?

Personal loans work the same for students as they would for anyone else: You get a lump sum of cash, and in exchange agree to make a monthly payment until the terms ends and your loan is paid off. Depending on the lender, that may include an origination fee — which is charged upfront and may reduce the amount of cash that is paid to your bank account. There may also be “avoidable” fees, like late fees or insufficient funds fees, which can add to the cost of the loan.

As with any other loan, a personal loan would be added to your credit profile, and will have an impact on your credit score. If you keep up with the payments, it will help build your score. If you don’t, it could hurt it, making it hard to get loans in the future.

How to apply for a personal loan

The first step is to shop around for personal loans and prequalify with multiple lenders. That way, you can compare estimates of rates and terms you might get based on your credit score. You should use prequalification when available to see if you’re likely to qualify for specific loans and what your terms might look like, without impacting your credit.

Once you’ve compared lenders and quotes, choose which looks the best and apply. In general, you’ll need to provide a government-issued I.D., and proof of income, like a pay stub or tax return, as well as your Social Security number (or Individual Tax Identification Number).

The amount of time it takes to be approved depends on the lender and how well you meet its requirements. But in general, you can expect to receive money within a few days of being approved. Some lenders can provide funding as soon as the same day you apply.

Alternatives to personal loans for students

If you’re looking to finance your education, a student loan is generally the next-best thing after using free money (like grants and scholarships). And, for ongoing access to money, a part-time job, work-study, or paid internship can be a good option, provided you can keep up with your studies.

Beyond that, there are other financial tools that you may also want to consider, including credit cards, family loans, and personal loans.

Be careful with credit cards. They’re convenient and allow you to draw from a credit limit, as needed. But interest costs can get out of control if you can only afford the minimum payment. This is because interest that goes unpaid from month to month is added to your account balance, on which new interest is charged. In other words, unpaid interest starts accruing interest itself.

If you don’t have any existing credit, you may need to add a cosigner to your loan applications, but not all lenders allow cosigners. But if you don’t need immediate access to funds, college is a good time to try and build credit so that you’ll be able to access cheaper loans in the future. That may mean opening a credit card (if you can get approved), getting added as an authorized user to a parent’s credit card, or getting a secured credit card.

Methodology

We evaluated the best personal loan lenders for students based on factors such as allowed loan purposes, minimum credit score and income requirements, customer experience, minimum fixed rate, maximum loan amount, funding time, loan terms, fees, discounts, and whether cosigners are accepted. Our team of experts gathered information from each lender’s website, customer service department, directly from our partners, and via email support. Each data point was verified by a third party to make sure it was accurate and up to date.

Best personal loans for students FAQ

Can you pay off student loans with personal loans?

In many cases, no, you cannot use a personal loan to pay off student loans since most lenders prohibit using them for higher education costs. Plus, you generally wouldn’t want to. Both private and federal student loans frequently have lower rates than personal loans. And federal loans have valuable borrower protections, like income-driven repayment, loan forgiveness, and deferment and forbearance options that you won’t find with a personal loan.

Do you need a cosigner to get a personal loan as a student?

It depends on whether you’ve built a credit history and have an income. A part-time job and an open credit card with a positive payment history and low credit utilization could be enough to get you a personal loan. Or not. If you can’t qualify for a personal loan on your own, some lenders will let you apply with a cosigner.

Can I get a personal loan as a student with no credit?

It may be possible to find a lender that offers personal loans with no credit history, especially if you have a qualified cosigner. But you may have to make concessions — like going with a higher APR or putting up collateral — to qualify.