How much of a personal loan can I get in 2024?

While lenders offer personal loans of $100,000 and more, that does not always mean you will qualify. How much of a personal loan you can get depends on several critical factors, such as your credit score, income and total debt. Lenders heavily weigh the likelihood of repayment before deciding how big of a loan you can get.

According to TransUnion’s Q2 2024 Credit Industry Insights Report, the average personal loan debt per borrower has increased to $11,687. That beats the average debt amount of $10,344 in Q2 2022 by over $1,000. However, many lenders offer loan amounts much higher than the average balance.

How big of a loan can I get?

Every lender will offer different personal loan terms, including the maximum and minimum amounts you can borrow. Maximum loan amounts vary widely by loan type and lender eligibility requirements.

For example, lenders like SoFi offer $100,000 personal loans. Also, although it’s rare, some personal loan companies offer personal loans up to $200,000. Qualifying for such a large loan requires pristine financials. Most lenders, however, offer borrowers with good credit scores loan amounts ranging from $30,000 to $50,000.

Regardless of the maximum amount offered by the lender, how big of a loan you can get will depend on your credit history, current score and your debt-to-income ratio. Every lender will have different minimum requirements. To qualify for the max loan amount, it’s crucial to meet and exceed the criteria.

If you don’t at least meet the financial requirements, a lender may conclude that you are unable to afford a larger loan. You may want to try to qualify for a lower amount or improve your credit before applying again.

What influences the amount you can borrow?

When deciding how much of a personal loan you can get, lenders consider several factors, including your credit score, payment history and debt-to-income ratio. For those struggling with a low credit score or a spotty payment history, a personal loan for bad credit may offer a more flexible qualification process in exchange for a higher rate.

However, there are still some considerations to keep in mind before you can get a personal loan. These are some of the factors lenders examine when approving a loan and determining how much you can borrow.

Income

Lenders want to know you have enough steady income to comfortably afford a new loan payment. The larger your income, the more likely you are to get approved for a larger personal loan. But it also matters whether a significant percentage of your income is already tied up in debt payments.

Current debts

Your lenders will consider your debt-to-income ratio (DTI) — the percentage difference between your monthly debt payments and your monthly gross income. Most lenders prefer your DTI to be 36 percent or lower, even after adding in the new loan payment. Those with a lower DTI are more likely to qualify for a larger loan amount.

Credit score

Lenders use your credit score as one of the primary factors in making lending decisions. Even if you have minimal debts and high income, a past history of missed payments or defaults will limit how much a lender offers you. The lower your score, the riskier you seem to lenders.

Additionally, your credit score and payment history will determine the interest rate you’re offered. The higher your credit score is, the more competitive your loan terms will be.

Employment

While you technically only need a regular source of income — which can be from benefits or self-employment — some lenders will offer larger loans to borrowers with a steady, predictable monthly income. Some lenders allow applicants to input multiple income streams, while others only accept one annual income.

If you’re self-employed or are a gig economy worker, check the requirements prior to applying. If possible, prequalify to see your predicted approval odds without affecting your credit.

Collateral

Most personal loans are unsecured loans, meaning they don’t require you to offer collateral — something of value, such as a bank account or home equity. However, some lenders offer secured personal loans.

For example, Best Egg offers personal loans that can be secured by the fixtures in your home. If you choose to take out a secured loan, make sure you can repay it as promised. Otherwise, the lender can take your collateral for defaulting on the loan.

Loan purpose

The reason for taking out a personal loan can also play a role in how much you can borrow. For example, the size of the personal loan you can qualify for an Achieve personal loan varies by loan purpose among other factors.

How much can you afford to borrow?

The amount you can afford will depend entirely on your budget. What can you spend without using your emergency funds?

You need to take into account more than just the principal amount. You should also consider the potential interest rate, the fees charged and how your desired loan term will impact the long-term loan cost.

A longer term would provide short-term relief by lowering the monthly payments. However, it would result in more interest accrual by the end of the repayment period, so you’ll pay more than you originally borrowed.

For example, a loan of $10,000 with an interest rate of 7 percent will have a significantly different monthly and overall cost depending on your loan term. Even if you would prefer to have a smaller payment, try to pay as much as your budget will allow for each month to keep total costs down.

How to qualify for a larger loan

While there is no shortcut to qualifying for a large loan, there are things you can do before applying to increase your odds.

• Improve your credit score: To build credit fast, make sure there are no errors on your credit reports and focus on making full, on-time payments on any current debts.
• Shop around: Compare multiple lenders, paying specific attention to the lender’s minimum eligibility criteria and loan terms and amounts. Go with the lender that offers the largest amount and most competitive loan terms.
• Lower your DTI: If you don’t need the loan immediately, consider chipping away at your existing debt. The lower your existing debt, the more likely you are to get approved for a larger loan.
• Consider a co-signer: If you’re having a hard time getting approved for a loan that meets your needs, look for lenders that allow for loan cosigners. Having a creditworthy friend or family member take on the loan with you can improve your approval odds and loan terms.

Bottom line

Personal loan amounts vary depending on the lender you choose, your credit score and overall financial situation. That said, no matter how much a lender offers, you should only borrow the amount you need to cover the expense. Over-borrowing will result in paying unnecessary interest and fees on money you may not need.

Lastly, compare personal loan rates from multiple lenders to ensure you get the best deal available for your situation. If you need a larger loan than what you’re getting approved for, use every option at your disposal — like using a co-signer or bolstering your income — before turning to alternative financing methods. This will help you avoid predatory lenders marketing themselves as quick solutions for those with bad credit.