If you’re looking for a place to call your own, the thought of building a home may have popped into your head. Constructing a new home is generally more expensive and takes more time and effort, but it can also ensure you get a home that’s move-in ready and customized to your liking.

Here’s what to consider if you’re deciding whether to buy or build a home:

Is it cheaper to buy or build a house?Pros and cons of building a housePros and cons of buying a houseShould you buy or build a house?

Is it cheaper to buy or build a house?

It’s generally cheaper to buy an existing home compared to a new-construction property, according to the National Association of Home Builders. The average cost of building a new home was $296,652 in 2019, but buying land and budgeting for pandemic-related price increases will drive up that price tag.

When you combine those costs in 2021, the average price of a new single-family home was $477,800 in October, compared to just $377,300 for an existing home.

Of course, the actual cost of each type of home could look different for you depending on location and what you’re looking for.

Cost of buying a house

You probably already know that you need to save for a down payment, closing costs, and cash reserves when getting a mortgage for an existing home — the same as you would with a newly constructed property. But there are some additional costs you’ll likely incur when buying a home:

Type of costEstimated costHomeowners insurance premium$1,478 per year for a 10-year-old homeReal estate agent’s commission5% to 6% of the home’s sales priceOngoing maintenance1% of the home’s value per yearAppliances$1,889Property taxesVaries by location. May be higher on a new-construction home because they’re often valued higher than resale properties. Sources: National Association of Home Builders, RedFin, and The Zebra

Shopping around for a mortgage can be stressful. Fortunately, Credible simplifies this process and makes comparing multiple lenders easy. You can see prequalified rates from our partner lenders and generate a streamlined pre-approval letter in just a few minutes.

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Cost of building a house

There are lots of pieces that go into building a home, and your home designer or builder can help you create a budget. In addition to the costs that come with buying a house, you’ll need to budget for the following building costs:

Type of costEstimated rangeLand and site work$5,000 – $38,000Foundation work$16,600 – $72,000Framing$16,600 – $95,000Exterior work$20,000 – $95,000Major systems$17,000 – $72,000Interior finishes$42,000 – $167,000Source: HomeAdvisor

Pros and cons of building a house

You’ll have to consider whether the chance to build the home of your dreams is worth the trade-offs. Some of the pros and cons of building a house include:

Pros of building a house

Customization: Depending on availability and the builder’s options, you may be able to fully customize your home in the neighborhood of your choice. Maintenance: Because everything is brand new, you likely won’t have to budget for major repairs and maintenance projects until later on. The builder may also cover the home under a builder warranty.Energy costs: Newly built homes come with windows, doors, HVAC systems, and appliances that are designed to keep homes as energy-efficient as possible. Using less energy keeps utility costs down and lowers your carbon footprint. Toxic materials: Some older homes are built with toxic materials such as asbestos, lead paint, and formaldehyde. New builds likely won’t use these materials.Competition: In a seller’s market, a home listing might attract multiple offers. But when you’re building a home, you won’t need to compete with other buyers once you buy the land.

Cons of building a house

Cost: When you factor in the cost of land, building a home is typically more expensive than buying an existing one.Effort: Although you’re not the one picking up the power tools, you may put in a lot of work making decisions as the home is being built.Time: It takes 6.8 months, on average, to build a new single-family property, according to the U.S. Census Bureau. You’ll need to budget for alternative living costs during this time.Contractors: You’ll need to work with the general contractor along with various subcontractors throughout the homebuilding process. That means you could encounter more delays and issues because more people are involved.Landscaping: If your newly built home doesn’t come with landscaping, you’ll need to spend time and money getting the yard you want.

Also See: Construction Loans: What They Are and How They Work

Pros and cons of buying a house

Buying an existing home is the more traditional approach as it typically saves you time and money. Some of the pros and cons of buying a home include:

Pros of buying a house

Convenience: Buying a move-in ready home is a quicker and more convenient process than building a home.Time: Building a home takes almost seven months on average, while the timeline for buying an existing house is much shorter. Cheaper: Nationwide, the cost of buying an existing property is generally lower than building a new home. However, that may change based on where you are and what you’re looking for.Landscaping: Older homes typically come with mature landscaping, so you won’t have to spend time and money on a new lawn and plants. More style options: Homes in older neighborhoods often have a variety of architecture styles and floor plans, and they may come with a certain antique charm.

Cons of buying a house

Competition: The average home listing received four offers in early 2021. In a competitive market with low inventory, you’ll need to make your offer stand out when buying a home.Ongoing repairs: The cost of ongoing repairs varies with each home, but professionals say it typically comes out to 1% of the home’s value per year. So a $200,000 home may cost $2,000 per year to maintain. Not as energy-efficient: An older home may come with older appliances and internal systems, so you’ll either pay higher utility bills or pay to replace these features.You may get less for your money: Existing homes are generally smaller than new construction, which means they may cost more per square foot. May contain toxic materials: Some older homes were built with hazardous materials such as lead and asbestos, which could put your family at risk. If you’re buying a resale home, it’s a good idea to test for these materials during the home inspection.

Don’t Miss: How to Buy a House: Step-by-Step Guide

Should you buy or build a house?

Because resale homes are generally cheaper and more convenient to move into, you might want to start your home search with existing properties. You can target desirable neighborhoods and spend a few weeks checking out the inventory there. These homes may not be in perfect condition or have exactly what you want — so plan on budgeting for renovations, new appliances, and ongoing repairs — but you might be willing to compromise if the price is right.

If you haven’t found what you’re looking for, then a new-construction home might be a good bet. Check out the costs of building in your area and the price of available land. Building a new home is usually more expensive, but there’s a reason for it. New homes come with new appliances, less maintenance, and better energy-saving measures, and they’re typically larger than what you’d find on an older home.

Check Out: How to Know If You Should Buy a House

The post Should I Buy or Build a House? appeared first on Credible.

A vendor take-back mortgage can help homeowners and real estate investors sell properties that aren’t moving in a tough market. They can also help buyers finance homes in a tight lending environment, or in a lending market that can’t accommodate their finances.

This type of mortgage can offer flexible solutions to challenging homebuying scenarios. However, it can also pose major risks for both buyers and sellers.

Here’s what you need to know about vendor take-back mortgages:

What is a vendor take-back mortgage?How vendor take-back mortgages workBenefits and risks of a vendor take-back mortgageVendor take-back mortgage vs. traditional mortgageExample of a vendor take-back mortgageWhen to consider a vendor take-back mortgage

What is a vendor take-back mortgage?

A vendor take-back (VTB) mortgage is a loan from a property seller to a property buyer. It can cover all or part of the purchase price.

Vendor take-back mortgages aren’t a popular way for individuals to buy and sell a primary residence. More often they’re used by real estate investors.

A vendor take-back mortgage is considered a type of creative financing, or an alternative to traditional financing. Whether you’re considering this option as a buyer or seller, proceed with caution.

What else is a VTB mortgage called? There are a wide variety of terms used to describe a vendor take-back mortgage, such as:

Seller financingSeller take-back mortgageSeller carry-back mortgageCarry-back financingOwner financing

How vendor take-back mortgages work

A vendor take-back mortgage functions much like a traditional mortgage, only there’s no lender serving as the middleman. The seller will act as a lender and have a lien on the home, and the buyer will make monthly payments to the seller. Like a traditional mortgage, the home serves as collateral for the take-back loan.

Here’s what to expect if you’re using a vendor take-back mortgage to buy or sell a home:

If you’re buying a home using seller financing: The seller will become your mortgage lender. They might be your only lender, or you might also finance part of the purchase price through another source, such as a bank. You’ll need to sign a promissory note legally agreeing to the deal’s terms. A buyer might consider a take-back home loan if they have poor credit, a lot of debt, or some other factor preventing them from qualifying for a mortgage.If you’re selling a home using seller financing: You’ll become the buyer’s mortgage lender. You’ll need to own your home free and clear before you can consider this option. Depending on the buyer’s needs, you might lend the entire purchase price or just part of it. A seller might consider this type of financing in a strong buyer’s market.

What are typical terms of a VTB mortgage?

If a vendor take-back mortgage will be the only financing, the buyer and seller have a lot of flexibility in structuring the deal.

Sellers will typically ask for a higher interest rate since they’re taking on risk by serving as the lender of the loan. But, the type of loan and length of the loan term can vary depending on the buyer’s needs.

Overall, there’s a lot of room for negotiating terms and closing costs, which is what makes vendor take-back mortgages enticing for both buyers and sellers.

Tip: While vendor take-back mortgages offer a great deal of flexibility for both parties, as the seller, you’ll still need to comply with state and federal mortgage lending laws.

Under federal law, that includes charging a fixed interest rate (or an adjustable rate that adjusts after five years) and making a good faith determination that the buyer can pay back the loan.

State law may require several pages of disclosures in a vendor financing agreement. And usury laws may cap how much interest you can charge as the seller, depending on how your state categorizes the transaction.

Be sure to hire an experienced lawyer to help you through the legal aspects of the transaction.

Benefits and risks of a vendor take-back mortgage

Whether you’re the buyer or the seller in a vendor take-back deal, you’ll want to understand the benefits and risks before signing any paperwork.

Benefits for buyers

As a buyer, you might be interested in a seller take-back mortgage because of these potential benefits:

More financing opportunities: If you’ve shopped around extensively and can’t find a lender that’ll give you a mortgage, seller financing might allow you to fund the purchase. Fewer closing costs: With seller financing, you shouldn’t have to pay for an origination fee or mortgage insurance premiums. Other closing costs, like a home appraisal and title search are up to your discretion (though, they’re generally encouraged to help protect your investment).Customized financing terms: You’ll still have to follow state and federal laws, but you won’t have to follow rules established by entities like Fannie Mae and the Federal Housing Administration. This leaves more room for negotiating the terms of your loan, and you might wind up with more favorable terms as a result.

Risks for buyers

However, you should also be wary of some serious potential drawbacks:

Higher interest rates: If you can’t get a traditional mortgage because lenders think your financial profile is too risky, an individual seller will likely feel the same way. If they do agree to a vendor take-back mortgage, they may charge a high interest rate to compensate them for the risk.Potential for mortgage fraud: A seller who doesn’t have the right (or intention) to give you a legal interest in the property might take your monthly payments under the guise of offering seller financing. You might think you’ve purchased a home when you’re really just renting it. And, if the property is already mortgaged and the borrower doesn’t pay, you could get evicted.Foregoing traditional protections: If you’re not experienced in buying and selling real estate, you could easily overpay for the home or buy a property with title defects that threaten your ownership rights. This is why most lenders require a home appraisal and title search.

Read: How to Get a Mortgage with a 600 Credit Score

Benefits for sellers

If you’re selling a home, here’s what might entice you to offer seller financing to a homebuyer:

Extra income on interest: Becoming a private lender might appeal to you if the price is right as it could end up netting you a higher return than your other interest-bearing investments. Of course, you’ll still need to pay tax on the interest income.Better chance at closing: In a buyer’s market where you haven’t been able to sell your home, a vendor take-back mortgage might help make the transaction possible and allow you to get closer to your asking price when other buyers have made lower offers. And since you’ll avoid lender processing times and other steps in the underwriting process, you may be able to close the deal faster.Tax breaks: If you’re eligible, you might not owe tax on the first $250,000 in profit from selling your home; that exemption doubles if you’re married. Using a vendor take-back mortgage might also allow you to treat the sale as an installment sale and pay less tax by receiving the proceeds over several years.

Risks for sellers

As a seller, you’ll also face certain risks if you offer seller financing to homebuyers:

Not getting all of the cash upfront: If you’re selling your home, you probably want to use the proceeds to buy a different home, increase your savings, or put toward some other expense. Providing seller financing means getting paid over time instead.Additional risk: If the borrower stops paying and you’re the sole lender, you may have to pursue costly and time-consuming foreclosure proceedings. If you provide secondary financing, you’re still likely to come up empty-handed since you hold the second lien. The primary lender will hold the first lien and will get paid first from foreclosing and selling the home.Unqualified or fraudulent buyers: There’s a good chance you don’t have the know-how or relationships to check a buyer’s creditworthiness with the thoroughness and accuracy that traditional mortgage lenders can. The buyer may not have the capacity or willingness to repay the loan.Important: Because vendor take-back mortgages are complex transactions, these are just a few of the potential benefits and risks. If you’re seriously considering this type of financing, whether as a buyer or seller, it would be wise to speak with a real estate attorney.

Vendor take-back mortgage vs. traditional mortgage

There are some key differences between vendor take-back mortgages and traditional mortgages:

VTB mortgageTraditional mortgageLenderHome sellerIncludes banks, mortgage lenders, and credit unionsInterest rateGenerally higher than traditional mortgage ratesVaries depending on a number of factors, including market conditions, loan size, and your credit scoreClosing costsUp to the two parties, but usually lower than what you would pay with a traditional lenderTypically 2% to 5% of the loan amountLoan termsMust have a fixed rate or an adjustable interest rate with no adjustment in the first five years; other terms, such as the term length, are negotiableVaries by lender (many lenders offer fixed-rate and adjustable-rate loans with terms between 10 to 30 years)QualificationsWhatever the seller will accept, subject to state and federal lawsVaries by loan type and lender (often a credit score of at least 620, a down payment of at least 3%, and a DTI of 50% or less)Mortgage insuranceNoneOften required with less than 20% down

Example of a vendor take-back mortgage

A vendor take-back mortgage can provide all or part of the financing a buyer needs. Here’s how those two options might work.

Partially funded VTB mortgage example

Let’s say you’re selling your house for $800,000, but no one has offered close to your asking price — and you’re not willing to sell for less.

A buyer’s agent suggests that you accept an offer in which the buyer makes a down payment of $50,000, gets a first mortgage for $650,000, and you finance the remaining $100,000 as a second mortgage (the VTB mortgage).

At closing, you would get $700,000 (the down payment plus the first mortgage). Over the next five years — or whatever terms you agreed to with the buyer — you would get the remaining $100,000.

Fully funded VTB mortgage example

Perhaps you’re in the market to buy a home, but can’t get pre-approved for a mortgage. But your agent convinces an investor who owns many homes to sell one to you and provide all of the financing.

The seller agrees, as long as you agree to an interest rate of 8% and pay off the loan in 10 years. The seller would hold the first and only mortgage against the home in the form of a VTB mortgage.

When to consider a vendor take-back mortgage

Vendor take-back mortgages come with significant risk for both the buyer and seller. They also require a level of financial sophistication that many individuals don’t have.

Here are the types of people who should and shouldn’t consider a vendor take-back mortgage:

Who a VTB mortgage is best suited for: A wealthy real estate investor or someone with a higher risk tolerance and experience with real estate transactions.Who a VTB mortgage is not suited for: Anyone whose retirement nest egg or personal savings is largely tied up in their home equity. Same goes for anyone unfamiliar with real estate laws and transactions. If any of this applies to you, and you lack the resources to hire a real estate attorney, you should probably avoid seller financing.

Keep Reading: 13 Tips for First-Time Homebuyers: Your Must-Know Advice

The post What Is a Vendor Take-Back Mortgage and How Does It Work? appeared first on Credible.

A tiny home generally refers to a home that’s 500 square feet or less. Because these structures are much smaller than traditional homes, buying one could be much more affordable in comparison.

Tiny homes cost $45,000 on average — but if you get one with few amenities, it could set you back as little as $8,000, according to HomeAdvisor. Additionally, there are several options that could help you finance a tiny home purchase, such as taking out a personal loan.

If you’re thinking about using a personal loan for tiny home financing, here’s what you should know:

Tiny home loan typesFinancing a tiny home: additional considerations

Tiny home loan types

If you’re looking to finance a tiny home, you likely won’t be able to use a traditional mortgage. While mortgage lenders don’t often disclose their minimum loan amounts, mortgages typically aren’t offered under $60,000 — meaning a tiny home purchase probably won’t qualify.

The good news is that there are several options available that could help you finance a tiny home purchase, including:

Personal loans

A personal loan is a type of installment loan that can be used for almost any personal expense, such as a tiny home. These loans are offered by a few types of lenders, including online lenders, banks, and credit unions.

You can typically borrow $600 to $100,000 with a personal loan and will have one to seven years to repay it, depending on the lender. Additionally, most personal loans are unsecured — meaning you don’t have to worry about collateral.

Tip: You’ll generally need good to excellent credit to qualify for a personal loan — a good credit score is usually considered to be 700 or higher. There are also several lenders that provide personal loans for bad credit, but these loans tend to come with higher interest rates compared to good credit loans.

If you have poor credit and are struggling to get approved, consider applying with a creditworthy cosigner to improve your chances. Not all lenders allow cosigners on personal loans, but some do. Even if you don’t need a cosigner to qualify, having one could get you a lower interest rate than you’d get on your own.

If you decide to take out a personal loan, be sure to consider as many lenders as possible. This way, you can find the right loan for your needs.

Credible makes this easy: You can compare your prequalified rates from our partner lenders in the table below in just two minutes — without affecting your credit.

LenderFixed ratesLoan amountsLoan terms (years)Time to fund

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Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

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9.95% – 35.99% APR$2,000 to $35,0002, 3, 4, 5*As soon as the next business day (if approved by 4:30 p.m. CT on a weekday)Fixed APR:
9.95% – 35.99% APRVariable APR:
N/AMin. credit score:
550Loan amount:
$2,000 to $35,000**Loan terms (years):
2, 3, 4, 5*Time to fund:
As soon as the next business day (if approved by 4:30 p.m. CT on a weekday)Fees:
Origination feeDiscounts:
AutopayEligibility:
Available in all states except CO, IA, HI, VT, NV NY, WVCustomer service:
Phone, emailSoft credit check:
YesLoan servicer:
AvantLoan Uses:
Debt consolidation, emergency expense, life event, home improvement, and other purposesMin. Income:
$1,200 monthly

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Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

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6.79% – 17.99% APR$10,000 to $50,0003, 4, 5, 6Next business dayFixed APR:
6.79% – 17.99% APRVariable APR:
N/AMin. credit score:
700Loan amount:
$10,000 to $50,000Loan terms (years):
3 to 6Time to fund:
Next business dayFees:
No prepayment penaltyDiscounts:
NoneEligibility:
Available in all 50 statesCustomer service:
PhoneSoft credit check:
YesMin. Income:
Does not discloseLoan Uses:
Debt consolidation, home improvement, self-employment, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

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4.99% – 35.99% APR$5,000 to $35,0002, 3, 4, 5As soon as 1 – 3 business days after successful verificationFixed APR:
4.99% – 35.99% APRVariable APR:
N/AMin. credit score:
600Loan amount:
$2,000 to $50,000Loan terms (years):
2, 3, 4, 5Time to fund:
As soon as 1 – 3 business days after successful verificationFees:
Origination feeDiscounts:
NoneEligibility:
Available in all states except DC, IA, VT, and WVCustomer service:
PhoneSoft credit check:
YesLoan servicer:
Best Egg and Blue Ridge BankMin. Income:
NoneLoan Uses:
Credit card refinancing, debt consolidation, home improvement, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

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5.99% – 24.99% APR$2,500 to $35,0003, 4, 5, 6, 7As soon as the next business day after acceptanceFixed APR:
5.99% – 24.99% APRMin. credit score:
660Loan amount:
$2,500 to $35,000Loan terms (years):
3, 4, 5, 6, 7Time to fund:
As soon as the next business day after acceptanceFees:
Late feeDiscounts:
NoneEligibility:
 Available in all 50 statesCustomer service:
PhoneSoft credit check:
YesLoan Uses:
Auto repair, credit card refinancing, debt consolidation, home remodel or repair, major purchase, medical expenses, taxes, vacation, and wedding

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Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

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7.99% – 29.99% APR$10,000 to $50,0002, 3, 4, 5As soon as 2 business daysFixed APR:
7.99% – 29.99% APRMin. credit score:
Does not discloseLoan amount:
$10,000 to $50,000Loan terms (years):
2, 3, 4, 5Time to fund:
As soon as 2 business daysFees:
Origination feeDiscounts:
NoEligibility:
Available in all states except CO, CT, HI, KS, NH, NY, ND, OR, VT, WV, WI, and WYCustomer service:
PhoneSoft credit check:
YesMin. Income:
NoneLoan Uses:
Debt consolidation, home improvement, wedding, travel, medical expenses, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

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7.04% – 35.89% APR$1,000 to $40,0003, 5Usually takes about 2 daysFixed APR:
7.04% – 35.89% APRMin. credit score:
600Loan amount:
$1,000 to $40,000Loan terms (years):
3, 5Time to fund:
Usually takes about 2 daysFees:
Origination feeDiscounts:
NoneEligibility:
Available in all 50 statesCustomer service:
Phone, emailSoft credit check:
YesLoan servicer:
LendingClub BankMin. Income:
NoneLoan Uses:
Debt consolidation, paying off credit cards, home improvement, pool loans, vacations, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

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9.99% – 35.99% APR$2,000 to $36,5002, 3, 4As soon as the next business dayFixed APR:
9.99% – 35.99% APRMin. credit score:
580Loan amount:
$2,000 to $36,500Loan terms (years):
2, 3, 4Time to fund:
As soon as the next business dayFees:
Origination feeDiscounts:
AutopayEligibility:
Available in all states except NV and WVCustomer service:
Phone, emailSoft credit check:
YesMin. Income:
$20,000Loan Uses:
Home improvement, consolidate debt, credit card refinancing, relocate, make a large purchase, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

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2.49% – 19.99% APR$5,000 to $100,0002, 3, 4, 5, 6, 7
(up to 12 years for home improvement loans)As soon as the same business dayFixed APR:
2.49% – 19.99% APRMin. credit score:
660Loan amount:
$5,000 to $100,000Loan terms (years):
2, 3, 4, 5, 6, 7*Time to fund:
As soon as the same business dayFees:
NoneDiscounts:
AutopayEligibility:
Available in all states except RI and VTCustomer service:
Phone, emailSoft credit check:
NoLoan servicer:
LightStreamMin. Income:
Does not discloseLoan Uses:
Credit card refinancing, debt consolidation, home improvement, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

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6.99% – 19.99% APR1$3,500 to $40,00023, 4, 5, 6, 7Many Marcus customers receive funds in as little as three daysFixed APR:
6.99% – 19.99% APR1Min. credit score:
660
(TransUnion FICO®️ Score 9)Loan amount:
$3,500 to $40,0002Loan terms (years):
3, 4, 5, 6Time to fund:
Many Marcus customers receive funds in as little as three daysFees:
NoneDiscounts:
AutopayEligibility:
Available in all 50 statesCustomer service:
PhoneSoft credit check:
YesLoan servicer:
Goldman SachsMin. Income:
$30,000Loan Uses:
Credit card refinancing, debt consolidation, home improvement, major purchase, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

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18.0% – 35.99% APR$1,500 to $20,0002, 3, 4, 5As soon as the same day, but usually requires a visit to a branch officeFixed APR:
18.0% – 35.99% APRMin. credit score:
NoneLoan amount:
$1,500 to $20,000Loan terms (years):
2, 3, 4, 5Time to fund:
As soon as the same day, but usually requires a visit to a branch officeFees:
Origination feeDiscounts:
NoneEligibility:
Must have photo I.D. issued by U.S. federal, state or local governmentCustomer service:
Phone, emailSoft credit check:
YesMin. Income:
Does not disclose

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

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4.99% – 17.99% APR$600 to $50,000
(depending on loan term)1, 2, 3, 4, 52 to 4 business days after verificationFixed APR:
4.99% – 17.99% APRMin. credit score:
660Loan amount:
$600 to $50,000*Loan terms (years):
1, 2, 3, 4, 5Time to fund:
2 to 4 business days after verificationFees:
NoneDiscounts:
NoneEligibility:
Does not discloseCustomer service:
Phone, emailSoft credit check:
NoMin. Income:
Does not discloseLoan Uses:
Debt consolidation, home improvement, transportation, medical, dental, life events

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

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6.95% – 35.99% APR$2,000 to $40,0003, 5As soon as one business dayFixed APR:
6.95% – 35.99% APRMin. credit score:
640Loan amount:
$2,000 to $40,000Loan terms (years):
3, 5Time to fund:
As soon as one business dayFees:
Origination feeDiscounts:
NoneEligibility:
Available in all states except IA, ND, WVCustomer service:
Phone, emailSoft credit check:
YesMin. Income:
NoneLoan Uses:
Debt consolidation, home improvement, vehicles, small business, new baby expenses, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
4.74% – 19.28% APR10$5,000 to $100,0002, 3, 4, 5, 6, 73 business daysFixed APR:
4.74% – 19.28% APR10Min. credit score:
Does not discloseLoan amount:
$5,000 to $100,000Loan terms (years):
2, 3, 4, 5, 6, 7Time to fund:
3 business daysFees:
NoneDiscounts:
AutopayEligibility:
Available in all states except MSCustomer service:
Phone, emailSoft credit check:
YesMin. Income:
Does not discloseLoan Uses:
Solely for personal, family, or household uses

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
8.93% – 35.93% APR7$1,000 to $50,0003 to 5 years 8Within one day, once approved9Fixed APR:
8.93% – 35.93% APR7Min. credit score:
560Loan amount:
$1,000 to $50,000Loan terms:
3 to 5 years 8Time to fund:
Within one day, once approved9Loan types:
Debt consolidation, pay off credit cards, home improvements, unexpected expenses, home and auto repairs, weddings, and other major purchasesFees:
Origination feeDiscounts:
AutopayEligibility:
A U.S. citizen or permanent resident; not available in DC, SC, WVCustomer service:
Phone, emailSoft credit check:
Yes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
5.94% – 35.97% APR$1,000 to $50,0002, 3, 5, 6Within a day of clearing necessary verificationsFixed APR:
5.94% – 35.97% APRMin. credit score:
560Loan amount:
$1,000 to $50,000*Loan terms (years):
2, 3, 5, 6Time to fund:
Within a day of clearing necessary verificationsFees:
Origination feeDiscounts:
AutopayEligibility:
Available in all states except West VirginiaCustomer service:
EmailSoft credit check:
YesMin. Income:
Does not discloseLoan Uses:
Debt consolidation, credit card refinancing, home improvement, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
4.37% – 35.99% APR4$1,000 to $50,00053 to 5 years4As fast as 1 business day6Fixed APR:
4.37% – 35.99% APR4Min. credit score:
580Loan amount:
$1,000 to $50,0005Loan terms (years):
3 to 5 years4Time to fund:
As fast as 1 business day6Fees:
Origination feeDiscounts:
NoneEligibility:
Available in all 50 statesCustomer service:
Phone, emailSoft credit check:
YesMin. Income:
$12,000Loan Uses:
Payoff credit cards, consolidate debt, take a course or bootcamp, relocate, make a large purchase, and other purposesCompare rates from these lenders without affecting your credit score. 100% free!

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Builder financing

Some tiny home builders offer their own financing programs, often in partnership with a third-party financial institution.

Interest rates and terms can vary widely with these options, so be sure to read the fine print carefully and ask any questions you might have to make sure you fully understand what you’re agreeing to.

Keep in mind: Some builders might require a down payment to secure financing — this could range anywhere from 10% to 20%, depending on the lender.

Learn More: Best Personal Loan Companies

Home equity loan or HELOC

If you already own a home, you might be able to tap into your home’s equity with a home equity loan or home equity line of credit (HELOC). With these options, you might be able to access 75% to 85% of your home’s equity, depending on the lender and the value of your home.

Here’s how they work:

Home equity loanLike personal loans, home equity loans are installment loans that typically come with fixed rates. Because a home equity loan is secured by your home, you’ll likely get a lower rate than you’d get on a personal loan. However, this also means you risk losing your home if you can’t make your payments.HELOCUnlike a home equity loan, a HELOC gives you access to a revolving credit line that you can repeatedly draw on and payoff — similar to a credit card. HELOCs also tend to come with variable rates, which means your rate could fluctuate with market conditions. Also remember that because your home acts as collateral for a HELOC, you risk foreclosure if you don’t keep up with your payments.How do I calculate my home’s equity? To calculate the equity in your home, you’ll subtract your current mortgage balance from your home’s current market or appraised value.

For example, if your home is worth $400,000 and you owe $300,000, then your home’s equity is $100,000.

Check Out: Personal Loan Requirements

Financing a tiny home: additional considerations

While the cost of a tiny home could be low, here are a few additional considerations to keep in mind:

Will you have to buy land?

You’ll need a place to build your home if you want a permanent structure — which means you’ll need to also purchase land. Depending on the location, this could end up being much more expensive than the actual house.

Keep in mind: If you’re thinking about buying raw, undeveloped land, then you’ll have to account for preparing the land for construction as well as getting it hooked up with water, power, and other amenities.

You’ll also need to consider local building codes and how much it will cost to make sure your dwelling is up to code. For example, some areas require that sleeping lofts in tiny homes have an automatic sprinkler system, which is another extra cost to budget for.

How will you pay for home maintenance?

Like any other home, tiny homes also come with maintenance costs. For example, you might need to service your plumbing, appliances, and other home systems. Plus, if your tiny home is on wheels, you might need to purchase and maintain a truck to haul it.

Learn More: Personal Loan Calculator: See Your Payments On a Loan

Will the home be on wheels?

If you’re planning to build or purchase a tiny home on wheels, you might be eligible for a recreational vehicle (RV) loan. Many of these loans use the RV (or tiny home) as collateral, which means you might get a lower rate compared to a standard unsecured loan.

Keep in mind: There are also lenders that offer unsecured RV loans — for example, Credible’s partner lender LightStream offers RV loans from $5,000 to $100,000 and doesn’t require collateral.

If you decide to take out a personal loan for a tiny home, remember to consider as many lenders as you can to find the right loan for your situation.

This is easy with Credible — you can compare your prequalified rates from multiple lenders in two minutes.

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The post Tiny Home Financing: What Are My Loan Options? appeared first on Credible.

Buying land can sometimes be a great investment — for example, you could purchase land to use for building a home or commercial property. There are also several potential ways to pay for it, such as taking out a personal loan, land loan, or construction loan.

If you’re thinking about getting a personal loan to buy land, here’s what you should know:

Personal loans vs. land loans vs. construction loansTaking out a personal loan to buy landPersonal loan eligibility requirementsLand financing alternatives

Personal loans vs. land loans vs. construction loans

There are a few types of loans that can be used to purchase land, including:

Personal loans: Disbursed as a lump sum that can be used how you wishLand loans: Designed for borrowers who want to purchase land but don’t want to build on it immediatelyConstruction loans: Available to potential homeowners who want to purchase land and immediately build a house on it

Here are several important points to consider as you compare your options:

Personal loansLand loansConstruction loansUseAlmost any personal expenses (some lenders might have limitations)For land purchase without immediate construction plansFor land purchase and immediate constructionInterest rate typeFixedFixedVariableInterest ratesFixed rates:
2.49%+
(with Credible partner lenders)Fixed rates: 4% to 5% APRVariable rates: 5% to 10% APRDown paymentNone20% to 50%
(depending on the lender)10% to 20%
(depending on the lender)Repayment terms1 to 7 years
(depending on the lender)2 to 5 years
(depending on loan type)12 to 18 monthsLoan amounts$600 to $100,000
(depending on the lender)Depends on land value, down payment amount, and lender maximumsNo specific maximum

Personal loans

Personal loans are installment loans that can be used to cover almost any personal expense. You can typically borrow $600 to $100,000 or more and have one to seven years to repay a personal loan, depending on the lender.

Keep in mind: Most personal loans are unsecured, which means you don’t have to worry about collateral. However, because these loans are riskier for lenders, you’ll generally need good to excellent credit to qualify.

If you decide to take out a personal loan to buy land, be sure to consider as many lenders as possible to find the right loan for you. Credible makes this easy — you can compare your prequalified rates from our partner lenders in the table below in two minutes.

LenderFixed ratesMin. credit scoreMax. loan amounts

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
9.95% – 35.99% APR550$35,000Fixed APR:
9.95% – 35.99% APRVariable APR:
N/AMin. credit score:
550Loan amount:
$2,000 to $35,000**Loan terms (years):
2, 3, 4, 5*Time to fund:
As soon as the next business day (if approved by 4:30 p.m. CT on a weekday)Fees:
Origination feeDiscounts:
AutopayEligibility:
Available in all states except CO, IA, HI, VT, NV NY, WVCustomer service:
Phone, emailSoft credit check:
YesLoan servicer:
AvantLoan Uses:
Debt consolidation, emergency expense, life event, home improvement, and other purposesMin. Income:
$1,200 monthly

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
6.79% – 17.99% APR700$50,000Fixed APR:
6.79% – 17.99% APRVariable APR:
N/AMin. credit score:
700Loan amount:
$10,000 to $50,000Loan terms (years):
3 to 6Time to fund:
Next business dayFees:
No prepayment penaltyDiscounts:
NoneEligibility:
Available in all 50 statesCustomer service:
PhoneSoft credit check:
YesMin. Income:
Does not discloseLoan Uses:
Debt consolidation, home improvement, self-employment, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
4.99% – 35.99% APR600$35,000Fixed APR:
4.99% – 35.99% APRVariable APR:
N/AMin. credit score:
600Loan amount:
$2,000 to $50,000Loan terms (years):
2, 3, 4, 5Time to fund:
As soon as 1 – 3 business days after successful verificationFees:
Origination feeDiscounts:
NoneEligibility:
Available in all states except DC, IA, VT, and WVCustomer service:
PhoneSoft credit check:
YesLoan servicer:
Best Egg and Blue Ridge BankMin. Income:
NoneLoan Uses:
Credit card refinancing, debt consolidation, home improvement, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
5.99% – 24.99% APR660$35,000Fixed APR:
5.99% – 24.99% APRMin. credit score:
660Loan amount:
$2,500 to $35,000Loan terms (years):
3, 4, 5, 6, 7Time to fund:
As soon as the next business day after acceptanceFees:
Late feeDiscounts:
NoneEligibility:
 Available in all 50 statesCustomer service:
PhoneSoft credit check:
YesLoan Uses:
Auto repair, credit card refinancing, debt consolidation, home remodel or repair, major purchase, medical expenses, taxes, vacation, and wedding

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
7.99% – 29.99% APRNot disclosed by lender$50,000Fixed APR:
7.99% – 29.99% APRMin. credit score:
Does not discloseLoan amount:
$10,000 to $50,000Loan terms (years):
2, 3, 4, 5Time to fund:
As soon as 2 business daysFees:
Origination feeDiscounts:
NoEligibility:
Available in all states except CO, CT, HI, KS, NH, NY, ND, OR, VT, WV, WI, and WYCustomer service:
PhoneSoft credit check:
YesMin. Income:
NoneLoan Uses:
Debt consolidation, home improvement, wedding, travel, medical expenses, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
7.04% – 35.89% APR600$40,000Fixed APR:
7.04% – 35.89% APRMin. credit score:
600Loan amount:
$1,000 to $40,000Loan terms (years):
3, 5Time to fund:
Usually takes about 2 daysFees:
Origination feeDiscounts:
NoneEligibility:
Available in all 50 statesCustomer service:
Phone, emailSoft credit check:
YesLoan servicer:
LendingClub BankMin. Income:
NoneLoan Uses:
Debt consolidation, paying off credit cards, home improvement, pool loans, vacations, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
9.99% – 35.99% APR580$36,500Fixed APR:
9.99% – 35.99% APRMin. credit score:
580Loan amount:
$2,000 to $36,500Loan terms (years):
2, 3, 4Time to fund:
As soon as the next business dayFees:
Origination feeDiscounts:
AutopayEligibility:
Available in all states except NV and WVCustomer service:
Phone, emailSoft credit check:
YesMin. Income:
$20,000Loan Uses:
Home improvement, consolidate debt, credit card refinancing, relocate, make a large purchase, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
2.49% – 19.99% APR660$100,000Fixed APR:
2.49% – 19.99% APRMin. credit score:
660Loan amount:
$5,000 to $100,000Loan terms (years):
2, 3, 4, 5, 6, 7*Time to fund:
As soon as the same business dayFees:
NoneDiscounts:
AutopayEligibility:
Available in all states except RI and VTCustomer service:
Phone, emailSoft credit check:
NoLoan servicer:
LightStreamMin. Income:
Does not discloseLoan Uses:
Credit card refinancing, debt consolidation, home improvement, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
6.99% – 19.99% APR1660
(TransUnion FICO®️ Score 9)$40,000Fixed APR:
6.99% – 19.99% APR1Min. credit score:
660
(TransUnion FICO®️ Score 9)Loan amount:
$3,500 to $40,0002Loan terms (years):
3, 4, 5, 6Time to fund:
Many Marcus customers receive funds in as little as three daysFees:
NoneDiscounts:
AutopayEligibility:
Available in all 50 statesCustomer service:
PhoneSoft credit check:
YesLoan servicer:
Goldman SachsMin. Income:
$30,000Loan Uses:
Credit card refinancing, debt consolidation, home improvement, major purchase, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
18.0% – 35.99% APRNone$20,000Fixed APR:
18.0% – 35.99% APRMin. credit score:
NoneLoan amount:
$1,500 to $20,000Loan terms (years):
2, 3, 4, 5Time to fund:
As soon as the same day, but usually requires a visit to a branch officeFees:
Origination feeDiscounts:
NoneEligibility:
Must have photo I.D. issued by U.S. federal, state or local governmentCustomer service:
Phone, emailSoft credit check:
YesMin. Income:
Does not disclose

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
5.99% – 17.99% APR660$50,000
(depending on loan term)Fixed APR:
5.99% – 17.99% APRMin. credit score:
660Loan amount:
$600 to $50,000*Loan terms (years):
1, 2, 3, 4, 5Time to fund:
2 to 4 business days after verificationFees:
NoneDiscounts:
NoneEligibility:
Does not discloseCustomer service:
Phone, emailSoft credit check:
NoMin. Income:
Does not discloseLoan Uses:
Debt consolidation, home improvement, transportation, medical, dental, life events

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
6.95% – 35.99% APR640$40,000Fixed APR:
6.95% – 35.99% APRMin. credit score:
640Loan amount:
$2,000 to $40,000Loan terms (years):
3, 5Time to fund:
As soon as one business dayFees:
Origination feeDiscounts:
NoneEligibility:
Available in all states except IA, ND, WVCustomer service:
Phone, emailSoft credit check:
YesMin. Income:
NoneLoan Uses:
Debt consolidation, home improvement, vehicles, small business, new baby expenses, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
4.74% – 19.28% APR10Does not disclose$100,000Fixed APR:
4.74% – 19.28% APR10Min. credit score:
Does not discloseLoan amount:
$5,000 to $100,000Loan terms (years):
2, 3, 4, 5, 6, 7Time to fund:
3 business daysFees:
NoneDiscounts:
AutopayEligibility:
Available in all states except MSCustomer service:
Phone, emailSoft credit check:
YesMin. Income:
Does not discloseLoan Uses:
Solely for personal, family, or household uses

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
8.93% – 35.93% APR7560$50,000Fixed APR:
8.93% – 35.93% APR7Min. credit score:
560Loan amount:
$1,000 to $50,000Loan terms:
3 to 5 years 8Time to fund:
Within one day, once approved9Loan types:
Debt consolidation, pay off credit cards, home improvements, unexpected expenses, home and auto repairs, weddings, and other major purchasesFees:
Origination feeDiscounts:
AutopayEligibility:
A U.S. citizen or permanent resident; not available in DC, SC, WVCustomer service:
Phone, emailSoft credit check:
Yes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
5.94% – 35.97% APR560$50,000Fixed APR:
5.94% – 35.97% APRMin. credit score:
560Loan amount:
$1,000 to $50,000*Loan terms (years):
2, 3, 5, 6Time to fund:
Within a day of clearing necessary verificationsFees:
Origination feeDiscounts:
AutopayEligibility:
Available in all states except West VirginiaCustomer service:
EmailSoft credit check:
YesMin. Income:
Does not discloseLoan Uses:
Debt consolidation, credit card refinancing, home improvement, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
4.37% – 35.99% APR4580$50,000Fixed APR:
4.37% – 35.99% APR4Min. credit score:
580Loan amount:
$1,000 to $50,0005Loan terms (years):
3 to 5 years4Time to fund:
As fast as 1 business day6Fees:
Origination feeDiscounts:
NoneEligibility:
Available in all 50 statesCustomer service:
Phone, emailSoft credit check:
YesMin. Income:
$12,000Loan Uses:
Payoff credit cards, consolidate debt, take a course or bootcamp, relocate, make a large purchase, and other purposesCompare rates from these lenders without affecting your credit score. 100% free!

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All APRs reflect autopay and loyalty discounts where available | LightStream disclosure | 10SoFi Disclosures | Read more about Rates and Terms

Land loans

Land loans are specifically designed for borrowers who are purchasing land but don’t have immediate plans to build on it. There are three main types of land purchases, each of which has its own kind of land loan. These include:

Raw land: This is land that hasn’t been developed and has no connection to the electrical grid, sewers, or roads. This kind of land can be less expensive, but the loans typically require a higher down payment (often 20% or more) and come with higher interest rates. If you’re interested in a raw land loan, be prepared to provide the lender with extensive documentation of your plans to develop the land.Unimproved land: This kind of land is somewhat more developed than raw land and usually has some amenities and connections to utilities. However, it generally won’t have an electric meter, natural gas meter, or phone box. Because unimproved land loans are less risky to the lender than raw land loans, they tend to have lower interest rates. However, you’ll still likely need to come up with a down payment of 20% or more as well as have a detailed plan for development.Improved land: This type of land is already set up with access to utilities, roads, sewers, and other major amenities, which makes it less of a risk to the lender. But keep in mind that this also makes it more expensive than raw or unimproved land. An improved land loan will typically come with a lower interest rate and require less of a down payment than other types of land loans. On the other hand, rates on these loans are much higher than you’d pay on a traditional mortgage.

Land loans typically come with an initial repayment term of two to five years followed by a balloon payment at the end of the term. There are also some lenders that might offer longer terms if you plan to build a home on the land.

Keep in mind: Because land loans are considered riskier than traditional mortgage loans, they can come with more stringent requirements and higher interest rates.

This means you’ll likely need to have excellent credit, a complete plan for the development of the land, and a substantial down payment.

Learn More: How to Get a Personal Loan

Construction loans

A construction loan is used to purchase land, then fund the construction costs of building a new home or structure. The repayment term for a construction loan usually is only as long as the construction itself — usually 12 to 18 months. After the construction is finished, the loan will convert to a traditional 15- or 30-year mortgage.

Keep in mind: Though construction loans are less risky than land loans, they’re still more expensive than traditional mortgage loans. You’ll generally need good to excellent credit, a 20% down payment, and a detailed plan for the construction, including schedule and budget projections.

Also note that construction loans generally have variable rates, which means your rate could fluctuate according to market conditions.

Check Out: Personal Loan Calculator: See Your Payments On a Loan

Taking out a personal loan to buy land

While using a personal loan to buy land could be a good idea in some cases, it isn’t right for everyone. Here are some pros and cons to consider as you weigh your options:

Benefits of using a personal loan for land purchase

Fixed rates: Personal loans have fixed interest rates, which means your payments will stay the same throughout the life of your loan.Might be less expensive: A personal loan could be less expensive compared to a land or construction loan since you don’t have to worry about a down payment. Fewer requirements: Unlike with land and construction loans, you don’t have to provide a detailed land development plan to take out a personal loan.

Disadvantages of personal loans for land purchase

Fewer options for bad credit: You’ll typically need good to excellent credit to get approved for a personal loan — which means it could be hard to qualify if you have poor or fair credit.Smaller loan amounts: You can generally borrow $600 to $100,000 with a personal loan, which might not be enough to cover your expenses.Higher interest rates: Personal loans can come with higher interest rates compared to other funding options, such as traditional mortgages or home equity loans.

Learn More: Best Personal Loan Companies

Personal loan eligibility requirements

While eligibility criteria for personal loans can vary by lender, there are a few common requirements that you’ll likely come across, including:

Good credit: You’ll generally need good to excellent credit to qualify for a personal loan — a good credit score is usually considered to be 700 or higher. There are also several lenders that offer personal loans for bad credit, but these loans tend to come with higher interest rates compared to good credit loans.Verifiable income: Some lenders have a minimum income requirement while others don’t. But in either case, you’ll likely need to provide proof of income so the lender can see that you can afford to repay the loan.Low debt-to-income ratio: Your debt-to-income (DTI) ratio is the amount you owe in monthly debt payments compared to your income. To get a personal loan, your DTI ratio should be no higher than 40% — though some lenders might require lower ratios than this.

Check Out: Personal Loan Requirements

Land financing alternatives

There are also several other potential ways to finance a land purchase. If a personal loan, land loan, or construction loan don’t seem right for you, here are a few alternatives to consider:

Section 523 loans: These U.S. Department of Agriculture (USDA) loans can be applied for by nonprofit organizations to buy housing sites for low- and moderate-income families. Houses on these sites must then be constructed by the Self-Help method — meaning families will help build each other’s homes.Section 524 loans: These USDA loans are similar to Section 523 loans but don’t have any restrictions when it comes to construction method.Home equity loan: If you’re a homeowner, you might be able to tap into your home’s equity with a home equity loan. Like personal loans, home equity loans are paid out as a lump sum that you can use how you wish. They also tend to have lower interest rates than personal loans. However, if you can’t keep up with your payments, you risk losing your home. HELOC: A home equity line of credit (HELOC) could be another way for homeowners to utilize the equity in their homes. Unlike a home equity loan, a HELOC is a type of revolving credit that you can repeatedly draw on and pay off — similar to a credit card. Just remember that because your home secures the loan, you risk losing it if you can’t make your payments.

If you decide to take out a personal loan to buy land, remember to shop around and consider as many lenders as you can to find the right loan for your needs. This is easy with Credible: You can compare your prequalified rates from multiple lenders in two minutes — without affecting your credit.

Ready to find your personal loan?
Credible makes it easy to find the right loan for you.

Free to use, no hidden feesOne simple form, easy to fill out and your info is protectedMore options, pick the loan option that best fits your personal needsHere for you. Our team is here to help you reach your financial goalsFind My Rate
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The post Can I get a Personal Loan to Buy Land? appeared first on Credible.

While the U.S. Small Business Administration (SBA) offers SBA loans to new and established small business owners, these loans require the borrower to submit a business plan and often take some time to process — which can mean they’re out of reach for entrepreneurs who need quick access to cash for their ventures.

However, you might be able to get the startup funding you need through a personal loan. Although some lenders prohibit their loans from being used for business expenses, there are others that will let you use the funds to buy inventory, pay for marketing, or cover other business-related costs.

Here’s what you need to know about using a personal loan to start a business:

15 personal loans to start a businessWhat is the difference between an SBA loan and a personal loan?Pros of using a personal loan to start a businessCons of using a personal loan to start a businessApplying for a personal loan for a businessChoosing the right lender

15 personal loans to start a business

If you decide to take out a personal loan for your business, it’s important to consider as many lenders as possible. This way, you can find the right loan for your needs.

This is easy with Credible. You can compare your prequalified rates from our partner lenders that offer personal loans for business expenses below in just two minutes.

LenderFixed ratesLoan amountsLoan terms (years)

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
9.95% – 35.99% APR$2,000 to $35,0002, 3, 4, 5*Fixed APR:
9.95% – 35.99% APRVariable APR:
N/AMin. credit score:
550Loan amount:
$2,000 to $35,000**Loan terms (years):
2, 3, 4, 5*Time to fund:
As soon as the next business day (if approved by 4:30 p.m. CT on a weekday)Fees:
Origination feeDiscounts:
AutopayEligibility:
Available in all states except CO, IA, HI, VT, NV NY, WVCustomer service:
Phone, emailSoft credit check:
YesLoan servicer:
AvantLoan Uses:
Debt consolidation, emergency expense, life event, home improvement, and other purposesMin. Income:
$1,200 monthly

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
6.79% – 17.99% APR$10,000 to $50,0003, 4, 5, 6Fixed APR:
6.79% – 17.99% APRVariable APR:
N/AMin. credit score:
700Loan amount:
$10,000 to $50,000Loan terms (years):
3 to 6Time to fund:
Next business dayFees:
No prepayment penaltyDiscounts:
NoneEligibility:
Available in all 50 statesCustomer service:
PhoneSoft credit check:
YesMin. Income:
Does not discloseLoan Uses:
Debt consolidation, home improvement, self-employment, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
4.99% – 35.99% APR$5,000 to $35,0002, 3, 4, 5Fixed APR:
4.99% – 35.99% APRVariable APR:
N/AMin. credit score:
600Loan amount:
$2,000 to $50,000Loan terms (years):
2, 3, 4, 5Time to fund:
As soon as 1 – 3 business days after successful verificationFees:
Origination feeDiscounts:
NoneEligibility:
Available in all states except DC, IA, VT, and WVCustomer service:
PhoneSoft credit check:
YesLoan servicer:
Best Egg and Blue Ridge BankMin. Income:
NoneLoan Uses:
Credit card refinancing, debt consolidation, home improvement, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
5.99% – 24.99% APR$2,500 to $35,0003, 4, 5, 6, 7Fixed APR:
5.99% – 24.99% APRMin. credit score:
660Loan amount:
$2,500 to $35,000Loan terms (years):
3, 4, 5, 6, 7Time to fund:
As soon as the next business day after acceptanceFees:
Late feeDiscounts:
NoneEligibility:
 Available in all 50 statesCustomer service:
PhoneSoft credit check:
YesLoan Uses:
Auto repair, credit card refinancing, debt consolidation, home remodel or repair, major purchase, medical expenses, taxes, vacation, and wedding

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
7.99% – 29.99% APR$10,000 to $50,0002, 3, 4, 5Fixed APR:
7.99% – 29.99% APRMin. credit score:
Does not discloseLoan amount:
$10,000 to $50,000Loan terms (years):
2, 3, 4, 5Time to fund:
As soon as 2 business daysFees:
Origination feeDiscounts:
NoEligibility:
Available in all states except CO, CT, HI, KS, NH, NY, ND, OR, VT, WV, WI, and WYCustomer service:
PhoneSoft credit check:
YesMin. Income:
NoneLoan Uses:
Debt consolidation, home improvement, wedding, travel, medical expenses, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
7.04% – 35.89% APR$1,000 to $40,0003, 5Fixed APR:
7.04% – 35.89% APRMin. credit score:
600Loan amount:
$1,000 to $40,000Loan terms (years):
3, 5Time to fund:
Usually takes about 2 daysFees:
Origination feeDiscounts:
NoneEligibility:
Available in all 50 statesCustomer service:
Phone, emailSoft credit check:
YesLoan servicer:
LendingClub BankMin. Income:
NoneLoan Uses:
Debt consolidation, paying off credit cards, home improvement, pool loans, vacations, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
9.99% – 35.99% APR$2,000 to $36,5002, 3, 4Fixed APR:
9.99% – 35.99% APRMin. credit score:
580Loan amount:
$2,000 to $36,500Loan terms (years):
2, 3, 4Time to fund:
As soon as the next business dayFees:
Origination feeDiscounts:
AutopayEligibility:
Available in all states except NV and WVCustomer service:
Phone, emailSoft credit check:
YesMin. Income:
$20,000Loan Uses:
Home improvement, consolidate debt, credit card refinancing, relocate, make a large purchase, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
2.49% – 19.99% APR$5,000 to $100,0002, 3, 4, 5, 6, 7
(up to 12 years for home improvement loans)Fixed APR:
2.49% – 19.99% APRMin. credit score:
660Loan amount:
$5,000 to $100,000Loan terms (years):
2, 3, 4, 5, 6, 7*Time to fund:
As soon as the same business dayFees:
NoneDiscounts:
AutopayEligibility:
Available in all states except RI and VTCustomer service:
Phone, emailSoft credit check:
NoLoan servicer:
LightStreamMin. Income:
Does not discloseLoan Uses:
Credit card refinancing, debt consolidation, home improvement, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
6.99% – 19.99% APR1$3,500 to $40,00023, 4, 5, 6, 7Fixed APR:
6.99% – 19.99% APR1Min. credit score:
660
(TransUnion FICO®️ Score 9)Loan amount:
$3,500 to $40,0002Loan terms (years):
3, 4, 5, 6Time to fund:
Many Marcus customers receive funds in as little as three daysFees:
NoneDiscounts:
AutopayEligibility:
Available in all 50 statesCustomer service:
PhoneSoft credit check:
YesLoan servicer:
Goldman SachsMin. Income:
$30,000Loan Uses:
Credit card refinancing, debt consolidation, home improvement, major purchase, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
18.0% – 35.99% APR$1,500 to $20,0002, 3, 4, 5Fixed APR:
18.0% – 35.99% APRMin. credit score:
NoneLoan amount:
$1,500 to $20,000Loan terms (years):
2, 3, 4, 5Time to fund:
As soon as the same day, but usually requires a visit to a branch officeFees:
Origination feeDiscounts:
NoneEligibility:
Must have photo I.D. issued by U.S. federal, state or local governmentCustomer service:
Phone, emailSoft credit check:
YesMin. Income:
Does not disclose

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
5.99% – 17.99% APR$600 to $50,000
(depending on loan term)1, 2, 3, 4, 5Fixed APR:
5.99% – 17.99% APRMin. credit score:
660Loan amount:
$600 to $50,000*Loan terms (years):
1, 2, 3, 4, 5Time to fund:
2 to 4 business days after verificationFees:
NoneDiscounts:
NoneEligibility:
Does not discloseCustomer service:
Phone, emailSoft credit check:
NoMin. Income:
Does not discloseLoan Uses:
Debt consolidation, home improvement, transportation, medical, dental, life events

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
6.95% – 35.99% APR$2,000 to $40,0003, 5Fixed APR:
6.95% – 35.99% APRMin. credit score:
640Loan amount:
$2,000 to $40,000Loan terms (years):
3, 5Time to fund:
As soon as one business dayFees:
Origination feeDiscounts:
NoneEligibility:
Available in all states except IA, ND, WVCustomer service:
Phone, emailSoft credit check:
YesMin. Income:
NoneLoan Uses:
Debt consolidation, home improvement, vehicles, small business, new baby expenses, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
8.93% – 35.93% APR7$1,000 to $50,0003 to 5 years 8Fixed APR:
8.93% – 35.93% APR7Min. credit score:
560Loan amount:
$1,000 to $50,000Loan terms:
3 to 5 years 8Time to fund:
Within one day, once approved9Loan types:
Debt consolidation, pay off credit cards, home improvements, unexpected expenses, home and auto repairs, weddings, and other major purchasesFees:
Origination feeDiscounts:
AutopayEligibility:
A U.S. citizen or permanent resident; not available in DC, SC, WVCustomer service:
Phone, emailSoft credit check:
Yes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
5.94% – 35.97% APR$1,000 to $50,0002, 3, 5, 6Fixed APR:
5.94% – 35.97% APRMin. credit score:
560Loan amount:
$1,000 to $50,000*Loan terms (years):
2, 3, 5, 6Time to fund:
Within a day of clearing necessary verificationsFees:
Origination feeDiscounts:
AutopayEligibility:
Available in all states except West VirginiaCustomer service:
EmailSoft credit check:
YesMin. Income:
Does not discloseLoan Uses:
Debt consolidation, credit card refinancing, home improvement, and other purposes

Credible Rating>


Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.

View details>
4.37% – 35.99% APR4$1,000 to $50,00053 to 5 years4Fixed APR:
4.37% – 35.99% APR4Min. credit score:
580Loan amount:
$1,000 to $50,0005Loan terms (years):
3 to 5 years4Time to fund:
As fast as 1 business day6Fees:
Origination feeDiscounts:
NoneEligibility:
Available in all 50 statesCustomer service:
Phone, emailSoft credit check:
YesMin. Income:
$12,000Loan Uses:
Payoff credit cards, consolidate debt, take a course or bootcamp, relocate, make a large purchase, and other purposesCompare rates from these lenders without affecting your credit score. 100% free!

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All APRs reflect autopay and loyalty discounts where available | LightStream disclosure | 10SoFi Disclosures | Read more about Rates and Terms

What is the difference between an SBA loan and a personal loan?

Personal loans are offered by private lenders — such as online lenders as well as traditional banks and credit unions — and can be used for almost any personal expense, such as covering business costs. With a personal loan, you can typically borrow $600 up to $100,000 or more with repayment terms from one to seven years, depending on the lender.

SBA loans, on the other hand, are partially guaranteed by the Small Business Administration. With these types of loans, the SBA guarantees lenders that it will pay up to 85% of the loan if the borrower defaults. These loans range from $25,000 up to $5 million with repayment terms from five to 25 years (depending on how you use the loan).

If you’re considering an SBA loan vs. a personal loan, here are some important points to keep in mind:

SBA loanPersonal loanFixed rates5% to 8% + prime
(depending on loan amount)
2.49%+
(with Credible partner lenders)
Variable rates2.25% to 4.35% + base rate
(depending on loan amount and term)N/ALoan amount$25,000 to $5 million$600 to $100,000
(depending on the lender)Repayment terms5 to 25 years
(depending on how loan is used)Typically 1 to 7 years
(depending on the lender)RequirementsYour business must: Operate for profitBe engaged in or propose to do business in the U.S. or its territoriesHave reasonable amount of owner equity to invest
(usually $1 for every $3 borrowed)Use alternative funding sources (including personal assets) firstCan vary by lender but typically must have:Good creditVerifiable incomeLow debt-to-income ratioCredit eligibilityPersonal and company credit must show positive payment historiesGenerally have good to excellent creditTime to fund5 to 10 business days for standard loans36 hours for express loansUsually about 1 week
(depending on the lender)

SBA loan requirements

SBA loans also have additional requirements compared to personal loans. To be eligible, your business must:

Operate for profitBe engaged in or propose to do business in the U.S. or its territoriesHave a reasonable amount of owner equity to invest (generally, $1 of your own money to invest for each $3 borrowed)Use alternative financial resources (including personal assets) before seeking financial assistance

These requirements can make it harder to qualify for an SBA loan as a new business owner compared to getting a personal loan — especially since you’ll also need to provide a full business plan to the lender.

Also keep in mind that both your personal and business credit history will be considered for an SBA loan. However, you’ll also have the opportunity to explain any extenuating circumstances that might have affected your credit history to the lender.

Can I get an SBA loan with bad credit?

Possibly. The Small Business Administration doesn’t have a minimum required credit score for its loans. Instead, it’s up to the lenders that offer these loans to determine who to approve. In general, the credit reports for both you and your company should illustrate positive payment histories and demonstrate your ability to manage your obligations.

However, you might still be able to get an SBA loan with bad credit — for example, if you’ve been in business for several years or if there are extenuating circumstances that led to your poor credit score. In these cases, it could still be worth it to apply for an SBA loan even if you have less-than-stellar credit.

Learn More: How to Get a Personal Loan

Can I get a personal loan with bad credit?

You’ll typically need good to excellent credit to qualify for a personal loan — a good credit score is usually considered to be 700 or higher. There are also several lenders that offer personal loans for bad credit, but these loans tend to come with higher interest rates compared to good credit loans.

If you have bad credit and are struggling to get approved for a personal loan, here are a few options to consider:

Apply with a cosigner. Having a creditworthy cosigner can increase your approval chances and might also get you a better interest rate than you’d get on your own. Just remember that because your cosigner shares responsibility for the loan, they’ll be on the hook if you don’t make your payments.Take out a secured loan. While most personal loans are unsecured, there are also some lenders that provide secured personal loans that require collateral. Because these loans are less risky for the lender, it could be easier to qualify for one even if you have poor credit. However, keep in mind that if you can’t make your payments, you risk losing your collateral.Improve your credit. If you can wait to take out a loan, it could be worth spending some time building your credit so you’ll have an easier time qualifying in the future. There are several potential ways to do this, such as making on-time payments on all of your bills or paying down credit card balances.

Check Out: Personal Loans to Consider When You’re Self-Employed

Pros of using a personal loan to start a business

Taking out a personal loan to start a business can be a good choice in some cases, but it isn’t right for everyone. If you’re considering a personal loan, here are a few potential benefits to keep in mind:

Lower rates: Personal loan interest rates tend to be lower than rates on credit cards.Might be easier to qualify for: Unlike with SBA loans, you don’t have to worry about providing a full business plan or having owner equity to be eligible for a personal loan. Fast funding: You can usually expect to get your funds within one week — though some lenders will fund loans as soon as the same or next business day after approval.

Cons of using a personal loan to start a business

Fewer options for bad credit: You’ll generally need good to excellent credit to qualify for a personal loan — which means you could have a hard time getting approved if you have poor or fair credit.Smaller loan amounts: Personal loans typically range from $600 to $100,000 — less than the $25,000 to $5 million you could get with an SBA loan. Shorter repayment terms: You’ll generally have one to seven years to repay a personal loan, depending on the lender. SBA loans, on the other, provide terms of 10 to 25 years, depending on how you use the loan. Personal loan prosPersonal loan consLower rates than credit cardsCould be easier to qualify for than an SBA loanFast fundingFewer options for bad creditSmaller loan amountsShorter repayment terms

If you decide to take out a personal loan for your business, be sure to consider your overall loan cost. This way, you can be prepared for any added expenses.

You can estimate how much you’ll pay for a loan using our personal loan calculator below.

Enter your loan information to calculate how much you could pay

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pplying for a personal loan for a business

If you’re ready to apply for a personal loan for your business funding needs, follow these four steps:

Compare lenders. Be sure to shop around and compare as many personal loan lenders as possible to find the right loan for your situation. Consider not only interest rates but also repayment terms, any fees charged by the lender, and whether the lender allows its loans to be used for business purposes. Pick a loan option. After comparing lenders, choose the loan option that best suits your needs.Complete the application. Once you’ve picked a loan option, you’ll need to fill out a full application and submit any required documentation, such as pay stubs or tax returns.Get your funds. If you’re approved, the lender will require you to sign for the loan so the funds can be disbursed to you. The time to fund for a personal loan is usually about one week — though with some lenders, you could get your money as soon as the same or next business day after approval.

Learn More: Where to Get a Personal Loan

Choosing the right lender

As you weigh your options, it’s critical to take the time to compare as many lenders as you can so you can find the best loan for your business needs. Here are several important points to consider as you do your research:

Loan uses: While the majority of lenders allow personal loans to be used for almost any personal expense, some limit the uses of their loans — and others specifically prohibit using their loans for business purposes.Interest rates: Your interest rate is one of the biggest factors that will determine how much you end up paying for your loan over time. Your credit score and the repayment term you choose will also impact the rates you qualify for.Repayment terms: You’ll generally have one to seven years to repay a personal loan, depending on the lender. While picking a longer term could reduce your monthly payments, it’s usually best to choose the shortest term you can afford to keep your interest costs low. Many lenders also provide lower rates to borrowers who opt for shorter terms.Loan amounts: Personal loans typically range from $600 to $100,000 or more, depending on the lender. You’ll need to think about exactly how much you’ll need for your business and which lenders provide large enough loans.Credit requirements: Most lenders require borrowers to have good to excellent credit to qualify for a personal loan. While some lenders provide bad credit loans, remember that these loans usually have higher interest rates in comparison. If you have bad credit, you might want to consider applying with a cosigner — not all lenders allow cosigners on personal loans, but some do.

If you’re ready to compare your loan options, Credible can help: You can see your prequalified rates from multiple lenders in two minutes — without affecting your credit.

Ready to find your personal loan?
Credible makes it easy to find the right loan for you.

Free to use, no hidden feesOne simple form, easy to fill out and your info is protectedMore options, pick the loan option that best fits your personal needsHere for you. Our team is here to help you reach your financial goalsFind My Rate
Checking rates won’t affect your credit

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The post Should I Take Out a Personal Loan to Start a Business? appeared first on Credible.