How to get a personal loan: Step-by-step guide

Peter Warden
Peter Warden
The Mortgage Reports Editor
July 31, 2019 - 5 min read

How to get a personal loan with little hassle

As a rule, easy-to-get loans are expensive. And inexpensive loans take a lot of time, money and effort before you get your money. But here’s an exception: one that’s affordable yet quick and light on admin. Read on to discover how to get a personal loan that’s easy on your pocket — and your time.

Speed vs cost

It’s simple to get money in a hurry. Applying for a payday loan is probably the fastest route. And it doesn’t take long to get a new credit card.

But you’ll usually pay for that speed and convenience. reckons a 400% APR is typical on the former. And another online source says that average APR on a new credit card in 2019 was 19.24%.

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Personal loans — the Goldilocks alternative

Personal loans are the Goldilocks alternative: not too costly, not too slow, not too big an administrative headache — just right. If you have an exceptional credit score and want the right loan, you could be offered an APR as low as 5%, though that rises quickly for lesser scores. But even if your score’s only good or fair, you’re likely to pay appreciably less than for the plastic for which you’re qualified.

Top 12 reasons more people are using personal loans

Meanwhile, many lenders of personal loans promise to give you a decision quickly and have your money in your bank account by the next working day. But if you want to know how to get a personal loan that’s the best deal possible, you might want to allow yourself an extra day or two for comparison shopping.

Why comparison shopping is important

Federal regulator the Consumer Financial Protection Bureau urges borrowers to comparison shop. Its website says:

Shop around: Consumers who consider interest rates offered by multiple lenders or brokers may see substantial differences in the rates. Consumers should compare the costs and terms of loans to find the deal that is best for them.

Now, it may be that your existing bank or credit union will offer you the best possible deal. Credit unions are especially strong for those with iffy credit requiring relatively small amounts — a couple of thousand dollars or so. But you won’t know whether the deal they offer you is the best until you compare it with others.

So, by all means, apply to your bank or credit union. But, at the same time, compare personal loan offers from other sources, too.

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How to get a personal loan quickly

It’s worth getting your ducks in a row before you start making applications. All that involves is preparing the information every lender is likely to request. That includes your:

  • Full name, address and contact details
  • Previous addresses
  • Date of birth
  • Mother’s maiden name
  • Social security number
  • Salary and other regular income
  • Employer’s contact details
  • Previous employers’ details, if you’ve only been in your job a short while

Lenders will almost certainly ask about certain outgoings. So make a list of your other debts and how much you have to pay on them each month: auto loan, student loan, minimum card payments and so on. You’ll also probably have to declare any alimony or child support obligations you have.

Be ready to prove your claims

The more you’re borrowing, the more documentary evidence a lender’s likely to require in support of your application. It might also demand a pile of paperwork if it suspects you’ve lied on your paper or onscreen form.

But even if neither of those is an issue, as a minimum, expect to have to upload, email or mail copies of recent documents that prove:

  • Who you are — drivers license, state ID, social security card, passport or similar
  • Where you live — current utility bills in your name or documentation for your lease or mortgage
  • How much you earn — bank statements, pay stubs or IRS paperwork

Having the documents ready before you apply can dramatically reduce the time it takes for your money to arrive in your bank account.

Your credit score

Now you’re set to apply to your bank or credit union and to comparison shop online. Don’t worry about this process harming your credit score. At this point, when you’re just asking for a quote, most lenders run a “soft” credit inquiry and that isn’t reported.

Only when you make a formal application with your chosen lender will your score take a small, inevitable hit. And that impact should quickly disappear as you make on-time payments. Indeed, your new loan might make your score higher within a few months.

Many borrowers find out their credit scores before making any application. The more accurate you are when you estimate your score, the more accurate your rate quotes are likely to be.

Credit scores count

It’s impossible to overestimate the importance of your score. It’s the single most important factor in determining how high or low an interest rate you’ll pay — and whether your application will be approved at all.

And that’s the case for all your borrowing. So your mortgage, credit card and loan rates are all highly dependent on your score when you apply.

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Improve your score

True, some lenders specialize in providing personal loans to those with poor credit. But your payments and interest rate are likely to be painfully high.

Chances are, you want to know how to get a personal loan because you need money in a hurry. But, if you can possibly wait a few months, you might be able to make big savings by spending that time improving your score.

Guide to improving your credit score

On your mark, get set ... go!

Once you begin to request quotes, things can move quickly. You find a deal you like (usually the one that ends up costing you the least) and you make your application.


The lender will tell you what supporting documents it needs. The faster you provide them, the quicker you’ll get your money. It will also let you know about closing procedures.

A straightforward application for a small or medium amount can often see your money in your account the next business day. And even complicated applications for five-figure advances are often wrapped up in days rather than weeks.

And then you can relax. You can use the money for any purpose: from debt consolidation to the vacation of your lifetime — and from buying a classic car to repaving your driveway. Better yet, you’ll know exactly when you’ll be debt-free and your payments will be easy to budget.

*TheMortgageReports and/or our partners are currently unable to service the following states - MA, NV