Key Takeaways
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Personal loan amounts vary by lender, but some lenders allow consumers to borrow up to $100,000.
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The amount a lender will allow you to borrow depends on several factors, such as your credit score, income, and debt-to-income ratio (DTI).
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Before applying for a loan, check your budget to assess how much you can comfortably borrow. Doing this can reduce the chance of default.
Some personal loan lenders allow you to borrow up to €100,000. But the amount you qualify for is based on your credit score and financial health.
According to TransUnion’s Consumer Pulse Study Q4 2023, the average personal loan debt per borrower is increased to $11,773. That exceeds the average debt amount of $11,116 in the fourth quarter of 2023 by more than $600. However, many lenders offer loan amounts that are much higher than the average balance.
How much loan can I get with a personal loan?
Every lender has different personal loan conditions, including the maximum and minimum amounts that 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. That’s probably the largest unsecured personal loan you’ll find. And qualifying for such a large loan requires impeccable financial records.
In general, most lenders offer borrowers with a good credit score loan amounts ranging from $30,000 to $50,000.
Regardless of the maximum amount offered by the lender, the amount you qualify for depends on your credit history, current score and your debt-to-income ratio. Each lender will have different minimum requirements. To qualify for the maximum loan amount, it is crucial that you meet or exceed the criteria.
If you don’t at least meet the financial requirements, a lender may interpret that as if you can’t afford a larger loan.
What affects the amount you can borrow?
Lenders consider the following factors when assessing your loan application:
Income
Lenders want to know that you have enough steady income to comfortably afford a new loan. The greater 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 in debt.
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 that your DTI be 36 percent or lower, even after you add the new loan payment. However, those with a lower DTI are more likely to qualify for a larger loan amount.
Bank rate tip: Calculate your DTI by adding your monthly debt payments, dividing by your gross monthly income and multiplying by 100. You can also use a DTI calculator.
Credit score
Lenders use your credit score as one of the most important factors when making credit decisions. Even if you have minimal debt and a high income, a history of missed payments or defaults will limit how much a lender will offer you. The lower your score, the riskier you appear to lenders.
Additionally, your credit score and payment history determine the interest rate you are offered. The higher your credit score is, the more competitive your loan terms will be.
Employment
Although you technically only need a regular source of income – for example from benefits or self-employment – some lenders will offer larger loans to borrowers with a stable, predictable monthly income. Some lenders allow applicants to enter multiple income streams, while others only accept one annual income.
If you’re self-employed or in the gig economy, check the requirements before applying or, if possible, pre-qualify to see your predicted chances of approval without impacting your credit.
How much can you borrow?
The amount you can afford depends entirely on your budget. What can you spend without using your emergency fund?
You have to take more into account than just the principal amount. You also need to consider the potential interest rate, the fees charged, and how the desired loan term will affect the cost of the long-term loan.
A longer term would provide short-term relief by lowering monthly payments. However, this would result in more interest accruing at the end of the repayment period, causing you to pay more than you originally borrowed.
For example, a $10,000 loan with a 7 percent interest rate will have significantly different monthly and total costs depending on your loan term.
Even if you prefer a smaller payment, try to pay as much as your budget allows per month to keep the overall cost down.
| Term of the loan | Monthly payment | Total interest paid |
|---|---|---|
| 3 years | $309 | $1,115.75 |
| 5 years | $198 | $1,880.72 |
| 7 years | $151 | $2,677.85 |
How do you 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 improve your chances.
- Improve your credit score: Make sure your credit reports are free of errors and focus on paying current debts on time and in full.
- Look around: Compare multiple lenders, paying specific attention to the lender’s minimum eligibility criteria and loan terms and amounts. Choose the lender that offers the largest amount and the most competitive loan terms.
- Lower your DTI: If you don’t need the loan immediately, consider paying off your existing debt. The lower your existing debt, the more likely you are to get approved for a larger loan.
- Consider a cosigner: If you’re having a hard time getting approved for a loan that meets your needs, look for lenders that allow cosigners. If you bring a creditworthy friend or family member into the loan, you can improve your approval chances and loan terms.
The bottom line
Personal loan amounts vary depending on the lender you choose, your credit score, and your overall financial situation. That said, no matter how much a lender offers, you should only borrow the amount you need to cover the costs. If you borrow too much, you’ll pay unnecessary interest and fees on money you may not need.
Finally, 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 available to you, such as getting a cosigner or increasing your income, before turning to alternative financing methods.
This will help you avoid predatory lenders marketing themselves as quick fixes for people with bad credit.
