Private Personal Loans

Loan Guides      Personal Loans      Private Personal Loans

Perhaps you have been shopping around and are having trouble getting approved for a loan at the amount you need. Whether you are a qualified borrower looking to compare options, or have a less-than-ideal credit score, private personal loans can be a great choice for those looking to finance a wide variety of needs and desires.


We Cover in This Guide

  • What are Private Personal Loans?
  • Benefits and drawbacks of a private personal loan (pros and cons)
  • How do rates compare
  • Where can I get one? (comparative lender chart)
  • How to apply (checklist)
  • FAQs

What are Private Personal Loans?

Private personal loans are typically unsecured (meaning that they do not require collateral) and furnished through non-institutional lenders. While rates may be higher than through a bank or credit union, they will usually have a faster turn-around time and a streamlined application process.

As with any personal loan, you can use it for anything you need. Whether remodeling a kitchen, covering medical bills, or even funding a vacation, the use of the funds is at the borrower’s discretion. While amounts will vary by lender, they typically range from $2,500-$50,000.

Benefits and Drawbacks of a Private Personal Loan

These types are ideal for those who are not able to get approved for the amount they need through a bank or credit union. Most borrowers are looking for an unsecured product, and if your credit is less than ideal, this can mean a relatively high interest rate. The good news is that you will likely have more options if you shop for private loans if you cannot find the right one through a traditional lender.

Pros Cons
Speedy application process Higher interest rates
Fast turnaround time May have inconsistent customer service depending on the lender
Options for low credit borrowers even if they have already been denied elsewhere

How do Rates Compare?

Rates will vary with private products compared to institutional ones, which are more upfront about their terms. It is important to shop around to make sure you are getting the best deal. In most cases, rates will be higher than a bank loan for the same amount.

Where Can I Get a Private Personal Loan?

These products can be found through a reputable online lender, or sourced through referrals. Borrowers will need to do some comparative shopping to find the best deal and doing the extra legwork may be the difference between whether or not you are approved for the amount you need.

Note: many financial institutions operate under various online subsidiaries. Take a look at who owns the lending platform as you compare, as many of these will have more strict qualifications in line with what a bank would offer.

Here, you can compare rates with these reputable online private lenders to see what they can do.


How to Apply

Before you fill out an application, use a loan calculator to see what you can expect based on your situation. Simply input the desired amount, your credit score, and ideal repayment terms for an estimate.Private personal loans
Many will allow you to pre-qualify before you apply, so shop around first before you take the time to fill out an application.

When you are ready, here is the documentation you will need:

Personal loan application checklist:

  • Government-issued ID
  • Credit score
  • Proof of residence
  • Income verification, including
    • W-2 or 1099
    • Proof of employment
    • Pay stubs
    • Bank statements
  • Cosigner information if applicable

Private lenders will have various avenues for applying, but the information they need will be the same. Remember, just because a lender requires a credit score does not mean it will be the sole basis of whether or not you get approved.


Q: I am still having trouble finding a lender willing to work with me, what do I do?
A: It may be difficult to tell if you are looking at an independent private lender or shopping with a bank’s subsidiary platform. For example, Quicken Loans is a subsidiary of Intuit, which is under Charles Schwab. This is important because you may be spinning your wheels shopping for a product with terms similar to a bank product, thinking you found an independent firm. Be sure you specify private loan as you search for a lender.

Ask business professionals or even friends and relatives if they know of a lender. A referral may make it even easier to get approved for what you need.

Q: How can I improve my interest rate with a private personal loan?
A: The nice thing about working with an independent firm is that they have more flexibility to negotiate terms. Once they have approved an amount and rate, ask them if they can do better. After that, ask what can be done to improve the APR. Depending on what you are comfortable doing, you can ask if they will accept a cosigner, whether securing the loan with collateral (a vehicle title for example) will improve the terms, etc.


Private personal loans give borrowers the ability to obtain funds for a wide variety of needs, even without an excellent credit history. While their rate and terms may not be as competitive, independent firms provide customized products to suit the needs of their customers.