Best Small Personal Loans Review 2024: Pros and Cons

If you’ve been yearning for a comprehensive Small personal loans review, you can rest assured that you will find a suitable alternative here to help you access the money you need if you can’t consolidate your debt, take care of an unexpected expense, or finance a home improvement project.

Small Personal Loans Review

Small Personal Loans Review

A small personal loan is generally a loan for less than $2,500.

Although its Repayment terms differ widely, reputable lenders give you at least a few months to repay a small loan.

From our small personal loans review, annual percentage rates range from about 6% to 36%, with the lowest rates presented to borrowers with strong credit.

Pros and Cons of Small Personal Loans


1. One lump sum, usually with a fixed interest rate, helps keep monthly payments on track.

2. Get money quickly, sometimes within as little as a day, depending on the lender you choose.

3. Many are unsecured loans, which means your home or car isn’t used to borrow money.

4. Interest rates are much lower compared with payday loans, which charge upward of 400%.

5. Unlike highly risky payday loans, personal loans give you a reasonable amount of time to repay.


1. APRs are generally higher than those of some secured loans.

2. If you have a low credit score, you might not qualify.

3. Some lenders charge fees, like origination, late, and prepayment fees. The lower your credit score, the more likely you are to have a lender that charges more fees.

4. Some lenders don’t offer co-signers, which means you can only use your credit score and history to qualify.

5. You’re adding another bill to your monthly payments, which might stretch or even break your budget.

Where to Get a Small Personal Loans

Small Personal Loans Review

Credit Unions

Many credit unions look beyond your credit score on a personal loan application and review details like your membership report.

Credit union personal loan amounts can begin below $1,000, and federally chartered credit unions cap APRs at 18%.

Some federal credit unions also present payday alternative loans. These are small loans of $200 to $2,000 with rates kept at 28%.

Online Lenders

Online lenders can deliver personal loans for as little as $1,000 or $2,000.

Many online lenders allow you to pre-qualify to preview potential small loan offers, including the APR, repayment term, and loan amount, without affecting your credit score.

Capital Good Fund is one of the rare online lenders with low rates and loans that can be less than $1,000.

These loans are obtainable in only a handful of states, though, and loan amounts vary by state.


Some large banks like U.S. Bank and Citibank suggest personal loans with starting amounts of $1,000 or $2,000.

Others, including Discover and Wells Fargo, have starting payments of $2,500 or above. Banks normally prefer borrowers with good or excellent credit.

Most banks mandate customers to have a bank account open for a few months before they can apply for a small loan.


How to Compare Small Personal Loans

Small Personal Loans Review

Here are the most important features to compare when choosing small personal loans.

1. APR

Annual percentage rate delivers an apples-to-apples cost comparison for all loan types. The least pricey loan has the lowest APR.

2. Payments

Check your budget to see how much room you have to repay a loan.

A personal loan calculator can offer you what rate and repayment term you’d need to get an affordable monthly payment.

3. Terms

Some small loans hold a repayment term of a few weeks or months, while others can be repaid over a year or more.

A long repayment term implies that you’ll pay more in interest, so find a term that keeps payments low but helps you clear the debt quickly.

4. Requirements

Some lenders favor borrowers with strong credit and income, while others accept lower credit scores.

Review a lender’s borrowing requirements to decide your likelihood of qualifying.

5. Funding Time

Loan approval and funding can require a couple of days or up to a week, depending on the lender and how smoothly the application process goes.

If you require the funds fast, look for a lender that offers fast loans.

How to Get Small Personal Loans

Here are ways detailing how to secure small personal loans for your financial relief.

1. Review your credit and debts: Before applying, review your credit report for opportunities to address any negative marks or unpaid debts.

2. Pre-qualify: Since pre-qualifying usually demands a few minutes and doesn’t affect your credit score, it’s a quick way to compare small loans.

3. Collect necessary documents: A loan application may demand information like your Social Security number, W-2s, and pay stubs.

4. Submit the application: This part may be accomplished in person with local banks and credit unions, but many lenders have online applications.

How to Qualify for Small Personal Loans with Bad Credit

If you hold bad credit (a score of 629 or lower), you may still qualify for a small loan from a credit union or reputable online lender.

However, your rate could be on the high end of the lender’s coverage. Here are some ways to enhance your chances of qualifying:

1. Include a co-signer whose credit score or income is higher than yours.

2. Obtain a joint personal loan with someone whose credit score or income is higher than yours.

3. Pick a lender that offers secured personal loans.


How to Spot Predatory Small Personal Loans

Small Personal Loans Review

Small Personal loans from a predatory lender can damage your finances and trap you in a cycle of debt.

Watch for these red flags when shopping for small personal loans.

1. High-Interest Rates

Reputable lenders cap APRs at 36%, the highest rate most customer advocates say an affordable loan can have.

Some high-interest lenders can levy triple-digit interest rates or high fees that make the loan difficult to repay.

2. Extra Short Repayment Terms

Payday loans are so designated because you repay them on your next payday, usually in two weeks or less.

These loans demand a balloon payment (all or most of the loan is repaid at once) and may not give you enough time to pull the funds together.

3. Extra-Long Repayment Terms

Installment loans with long repayment terms are appealing because they hold low monthly or bi-weekly payments.

However, some lenders draw out the repayment term for longer than you need to make more money on interest.

An extra-long repayment term, even on small personal loans, could have you paying more than 50% of what you borrowed in interest.

4. Expensive Refinancing Options

Some high-interest installment lenders present refinancing options that may lower your monthly payment.

However, due to their high rates, this alternative could keep you in debt for longer and cost you much more in interest.

5. No Credit Checks

A lender who approves you without reviewing your credit isn’t trying to ensure that you can repay the loan but may even be betting that you can’t, which could lead you to borrow more money.

Alternatives to Small Personal Loans

It is advisable to exhaust the cheaper alternatives before getting a small loan, even if you require the money for an emergency.

Consider these small personal loans review options first and foremost:

1. Form a lending circle with friends and family members you depend on, or accept a loan from a family member.

2. Pick up a side gig to make extra cash. Alternatives range from selling clothes to walking dogs.

3. Seek help from local nonprofits, charities, and religious organizations for help with things like bills, gas, groceries, food, or clothes.

4. Borrow against your next salary with a cash advance app. These loans can offer affordable options to borrow a few hundred dollars.

5. Use a “buy now, pay later” app to break the cost of a large purchase into smaller payments spread out over a few weeks or months.

To round up on our small personal loans review, if you use a personal loan the right way, it may help you to pay off other high-interest debts or cover essential, unplanned expenses.

Make sure to carefully assess your ability to pay back the loan because taking on debt is a serious decision and should not be taken lightly.

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