PenFed personal loans: 2025 review

PenFed is best for people with good credit who need a small loan

PenFed is Bankrate's best good credit loan for 2024, primarily due to its low fees and member benefits. Because many of PenFed's requirements aren't listed, those with good credit and a solid repayment history have the highest approval odds.

PenFed personal loan purposes

PenFed’s website doesn't specify what you can and cannot use the funds for. With amounts up to $50,000, no fees and competitive rates, these loans are well-suited for everything from large purchases and projects to debt consolidation.

However, most lenders prohibit using personal loans for investing, certain business expenses or college tuition. 

The use requirements vary by institution, so read the terms and conditions carefully before accepting your offer.

Where PenFed personal loans stand out 

• Low fees: Unlike some lenders, PenFed doesn't charge fees on top of your interest rate. It charges no origination, application or prepayment fees.
• Allows joint applications: PenFed allows applicants to apply with a joint borrower who has a higher income or credit score. This can increase your chance of getting approved and scoring a lower interest rate.  
• Fast disbursement: Depending on the time of day that your loan is processed, you could receive your funds as early as the next business day if you choose direct deposit. If you opt to receive your funds by check, it'll take anywhere from five to seven business days. However, PenFed notes that the actual timing may be longer or shorter depending on your financial institution and exactly when the loan is processed. 

Where PenFed personal loans fall short 

• Limited eligibility information: The website's eligibility information is sparse, leaving out requirements like minimum income and debt requirements. That said, you can prequalify without hurting your credit score, so it’s still relatively easy to see your eligibility.
• Membership required: PenFed requires personal loan applicants to be credit union members. Membership is open to everyone, but you will need to apply. Plus, if you're approved for membership, you'll need to maintain a PenFed checking account by depositing a $5 minimum amount. 
• Middling maximum amount: PenFed's maximum loan amount of $50,000 is average compared to other companies on the market. Many offer borrowing amounts of up to $100,000. 

How this lender compares

PenFed vs. LightStream

PenFed and LightStream are strong contenders for those with excellent credit. They offer similar APR ranges, although PenFed comes out ahead of LightStream's maximum APR of 24.29 percent. Plus, borrowers should consider prequalifying with PenFed first — LightStream doesn't offer the same benefit. 

PenFed vs. SoFi

PenFed and SoFi both offer competitive personal loan interest rates for borrowers in good financial shape. But SoFi stands out among the rest due to its protections and benefits. Even so, those who are already members of PenFed may want to consider borrowing within the credit union, as they'll gain access to exclusive member benefits.

Do you qualify for a PenFed personal loan?

The credit union's eligibility qualifications aren't listed on its website, but personal loan lenders and credit unions generally require the following. 

• Good to excellent credit score: Those with higher scores will be offered the most favorable rates. 
• Strong credit history: Those with a thin or less-than-stellar credit history may need to enlist the help of a co-borrower to get approved. 
• Low debt-to-income (DTI) ratio: Your DTI ratio is determined by dividing your total debts by your gross monthly income. Lenders typically favor those who have a DTI no greater than 36 percent.  

How to apply for a personal loan with PenFed

You can apply for a PenFed personal loan before becoming a member, but you must become a member to view your terms. The application process can be completed online or in person at one of its brick-and-mortar locations. 

Before applying, have your employment and annual income documentation on hand, as well as an official government ID, to ensure a smooth and easy process. 

1. Go to the "Personal Loans" tab in the "Loans" section.
2. Click on the green "Check your rate" button. If you're already a member you can choose to log in and if you're not yet a member, PenFed will create your membership alongside your loan application. 
3. Follow the application prompts. Be prepared to upload personal documentation and state the reason for your application, as well as basic details like your requested loan amount and term. 
4. Keep an eye out for any information from PenFed regarding your status and download the mobile app to track your application status. 
5. Depending on the disbursal method you choose, you could receive the funds in as little as one to two business days. 

Should your application time out, you can pick up where you left off later through a one-time verification code that will be sent to you via text message.

Features and additional perks

How Bankrate rates PenFed