Get referred with lenders who may offer the loan you’re looking for. No obligation to accept.
Checking your options typically involves a soft credit inquiry. Final approval may require a hard inquiry from the lender.
| A |
The process of paying off a loan through regular scheduled payments that cover both principal and interest. With a fully amortizing loan, your balance reaches zero by the final payment.
Example: A $10,000 loan at 15% APR over 36 months amortizes fully, each of the 36 payments reduces both the interest accrued and the outstanding principal.
The true annual cost of borrowing, expressed as a percentage. APR includes the interest rate plus any fees the lender charges, making it a more complete cost comparison than the interest rate alone.
Example: An 18% interest rate with a 2% origination fee results in an APR higher than 18%. Always compare APRs, not just rates, when evaluating offers.
A fee charged by some lenders simply to process your loan application. Many reputable lenders do not charge this. If a lender charges an application fee, factor it into your total cost comparison.
A small reduction in your interest rate, typically 0.25%–0.5%, offered by some lenders when you enroll in automatic monthly payments. Small, but worth enabling if available.
| B |
A large, lump-sum payment due at the end of a loan term. Most personal loans are fully amortizing and do not have balloon payments, but some products do. Always check your loan agreement.
Example: A loan with a 24-month term might require 23 small payments followed by one large final payment that pays off the remaining balance.
The individual who receives and is legally responsible for repaying the loan. If you sign a loan agreement, you are the borrower.
| C |
A second person who applies for a loan alongside the primary borrower and shares equal responsibility for repayment. Different from a co-signer, both co-borrowers’ income and credit are fully considered.
A person who agrees to repay the loan if the primary borrower cannot. Adding a co-signer with stronger credit can improve your chances of approval or result in a lower rate, but the co-signer takes on real financial risk.
An asset pledged to secure a loan. If the borrower defaults, the lender can seize the collateral. Personal loans are typically unsecured, no collateral required.
One of the three major agencies, Equifax, Experian, and TransUnion, that collect and maintain consumer credit data. Lenders report your payment history to these bureaus, and your credit report is compiled from that data.
A check on your credit report. A soft inquiry (used for pre-qualification) doesn’t affect your score. A hard inquiry (used for final approval) may cause a small, temporary score decrease of 2–10 points.
The variety of credit types on your report, credit cards, auto loans, mortgages, personal loans. A diverse mix can positively affect your score. Adding a personal loan can improve your mix if you only have revolving credit.
A numerical representation of your creditworthiness, typically ranging from 300 to 850. The most widely used model is FICO. Higher scores generally lead to better loan offers and lower APRs.
Example: A borrower with a 720 score will typically receive a lower APR than one with a 600 score applying for the same loan amount.
The percentage of your available revolving credit you’re currently using. Lower is better, most scoring models prefer utilization below 30%.
Example: If you have a $10,000 credit limit and carry a $4,000 balance, your utilization is 40%.
| D |
Failure to repay a loan according to the agreed terms. Defaulting on a personal loan can result in collections, legal action, and severe long-term credit damage.
The percentage of your gross monthly income that goes toward existing debt payments. Most lenders prefer a DTI below 40%. Formula: total monthly debt payments ÷ gross monthly income × 100.
Example: Monthly debts of $800 on a $3,000 gross income = DTI of 26.7%.
A loan payment that is past due. Most lenders report delinquency to credit bureaus after 30 days. Even one missed payment can significantly affect your credit score.
The release of loan funds to the borrower. Most personal loans are disbursed via ACH direct deposit to your bank account within 1–7 business days after final approval.
| F |
An interest rate that remains the same for the entire loan term. Your monthly payment never changes. All personal loans in our network use fixed rates.
Example: A 15% fixed APR on a $10,000 loan means every monthly payment is calculated at that same rate, it doesn’t rise if market rates increase.
The process by which loan proceeds are transferred to the borrower’s bank account after final approval and loan signing. Timing varies by lender.
| G |
A window of time after a payment due date during which a payment can be made without penalty or negative credit reporting. Not all lenders offer a grace period, check your agreement.
Your total income before taxes and deductions. Lenders use gross income (not take-home pay) when calculating your DTI ratio.
Example: If you earn $4,000/month before taxes, your gross income is $4,000, even if you take home $3,200.
| H |
A credit check that occurs when a lender formally reviews your credit report for a loan application. May cause a small, temporary score decrease. Multiple hard inquiries within a short window (14–45 days) are typically treated as one for rate-shopping purposes.
| I |
A loan repaid in fixed, regular payments (installments) over a defined period. Personal loans are installment loans. This contrasts with revolving credit like credit cards, which have variable payments and no defined end date.
The base cost of borrowing expressed as a percentage, before fees. Not the same as APR, which includes fees. Always compare APR, not just interest rate, for an accurate cost comparison.
| L |
A penalty charged when a loan payment is not made by the due date (or within the grace period, if applicable). Can range from a flat fee to a percentage of the payment amount.
The financial institution or company that provides loan funds. In our network, lenders are independent partners, we are not a lender.
The legally binding contract between borrower and lender that details all loan terms: amount, APR, payment schedule, fees, and conditions. Read it fully before signing.
The length of time you have to repay a loan. Personal loan terms typically range from 61 days to 84 months. Longer terms mean lower monthly payments but more total interest paid.
Example: A $10,000 loan at 15% APR over 36 months has a higher monthly payment than the same loan over 60 months, but significantly less total interest.
| M |
The fixed amount you pay each month toward your loan, covering both principal and interest. Calculated using the loan amount, APR, and term length.
The annual interest rate divided by 12. Used in the standard loan payment formula: M = P × [r(1+r)ⁿ] ÷ [(1+r)ⁿ − 1].
Example: A 15% APR divided by 12 = 1.25% monthly interest rate.
| N |
Your take-home pay after taxes and deductions. Lenders use gross income for DTI calculations, but net income gives you a more realistic sense of what you can afford in monthly payments.
| O |
A one-time fee charged by some lenders to process a loan, typically 1%–8% of the loan amount. It may be deducted from your disbursement or added to your balance. Always check whether a lender charges this, as it affects your actual loan proceeds.
Example: A $10,000 loan with a 3% origination fee means you receive $9,700 but repay the full $10,000.
| P |
The most heavily weighted factor in your credit score (approximately 35% of your FICO score). A record of on-time payments improves your score; missed or late payments hurt it significantly.
A conditional offer from a lender based on a more thorough review of your finances, sometimes including a hard inquiry. More reliable than pre-qualification, but still not a final loan commitment.
An early estimate of loan options based on basic information, typically using only a soft credit inquiry. No credit impact. Useful for comparing lenders without commitment.
A fee charged for paying off your loan before the scheduled end of the term. Not all lenders charge this. Always check your loan agreement for early payoff terms before signing.
The original amount of money borrowed, before interest is added. Your monthly payment is split between principal (reducing your balance) and interest (the cost of borrowing).
Example: On a $10,000 loan, the principal is $10,000. Each payment chips away at this balance.
| R |
Replacing an existing loan with a new one, typically at a lower rate or with different terms. Can reduce your monthly payment or total interest paid.
A detailed breakdown of each scheduled payment, showing how much goes toward principal and how much toward interest over the life of the loan. Also called an amortization schedule.
| S |
A loan backed by collateral, an asset the lender can claim if you default. Personal loans are typically unsecured, meaning no collateral is required.
A credit check that does not affect your credit score. Used during pre-qualification and rate shopping. Not visible to other lenders on your report.
| T |
The sum of all interest and fees you’ll pay over the full loan term, in addition to repaying the principal. The most honest measure of what a loan will actually cost you.
Example: A $10,000 loan at 18% APR over 36 months costs approximately $2,956 in total interest, making the true total cost $12,956.
A federal law requiring lenders to clearly disclose loan terms, including APR, total cost, payment schedule, and fees, before you sign. The TILA disclosure is your most reliable source of loan cost information.
| U |
The process a lender uses to evaluate a loan application, reviewing credit history, income, employment, and other factors to decide whether to approve a loan and at what rate.
A loan that is not backed by collateral. Personal loans are typically unsecured. Because lenders take on more risk, unsecured loans often carry higher rates than secured loans.
| V |
An interest rate that can change over time, typically tied to a benchmark rate. Most personal loans offer fixed rates, but credit cards often carry variable rates. Avoid confusing the two.
| W |
Used in debt consolidation to calculate the single average rate across multiple debts, proportional to each balance. Helps determine whether a consolidation loan offers a genuine rate improvement.
Example: $5,000 at 20% and $5,000 at 24% = weighted average of 22%. A consolidation loan below 22% APR would reduce total interest paid.
| Tip | When reviewing any loan offer, always look at three numbers together: the APR (total annual cost), the monthly payment (what you’ll pay each period), and the total repayment amount (what you’ll pay in full). These three together tell the complete story of a loan’s cost. |
We want you informed, protected, and confident.
If you ever feel uncertain, take your time, ask questions, compare options, and choose what’s best for you.
