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By now, you’ve probably already calculated how much of a personal loan you can get. And you likely have a solid understanding of the personal loan requirements to get approved. You may be wondering about the next step in the process: how to get a personal loan.

Applying for a loan can be relatively simple, as long as you understand the options available to you, meet the lender’s requirements, and have the necessary paperwork in order ahead of time. Here’s what you need to know.

1. Prequalify for a Personal Loan Through Multiple Lenders

The first step in applying for a personal loan is to get prequalified. You can get a personal loan from a few different sources, including a bank, credit union, or an online lender. Each has its pros and cons.

Personal Loan from a Traditional Bank

One drawback of getting any type of personal loan from a bank is that it can take longer to be approved compared to an online lender. However, banks have greater lending power, so you might be able to get a larger loan. Plus, many banks will not charge an origination fee.

Pros	Cons
In-person application	High credit score requirements
Low or no origination fees	High maximum APRs
Low minimum APRs	Slow approval

Personal Loan from a Credit Union

Credit unions are likely to offer the lowest APRs and have low fees to boot — two advantages if you’re already a member of one. However, there are potential tradeoffs. Smaller credit unions tend to have limited digital offerings compared to national banks, and it may take borrowers longer to get approved for a personal loan.

Pros	Cons
Lower interest rates than banks and online lenders	You have to be a member
Low fees	Digital offerings may be more limited
Members may find it easier to get a loan with a credit union vs. a bank	Slow approval

Personal Loan from an Online Lender

With an online lender, your personal loan application is approved and managed entirely online — there is no opportunity to sit down with a loan officer. Depending on whether you’d prefer to apply for a loan online vs. in person, this could be either an advantage or a disadvantage.

If you visit an online loan aggregator site, you can apply for preapproval and receive multiple loan options. From there, you can easily compare the rates and terms, but be sure to confirm the fees and charges.

Pros	Cons
You can easily compare rates and terms of online lenders on aggregator sites	Fast approval process, with funds deposited sometimes within one business day
Get multiple loan offers from an aggregator site with no hard credit pull	Potentially high fees
The loan application process can be managed completely online	If you don’t have a great credit score, you might face a high APR

Does Preapproval Hurt My Credit Score?

In order to be preapproved for a personal loan, a lender will check your credit history. Typically, the lender will only perform a “soft” credit inquiry, which will not affect your credit score. A preapproval determines if you’re eligible for a loan before you formally apply.

Applying for a loan triggers a “hard” credit inquiry, which could pull down your credit score because you have applied for additional credit.

You can check with a lender to find out what type of check they will do to preapprove you for a personal loan.

Recommended: Personal Loan Glossary: Loan Terms to Know Before Applying

What Do I Need to Prequalify for a Personal Loan?

To qualify for a personal loan, you will need to first determine how much you want to borrow and how much you can afford to pay each month to pay off the loan. How much you can pay each month will determine the term (length) of the loan.

How much you want to borrow will depend on what you want to use the money for. While there are few limitations on how you spend the personal loan funds, it’s wise to borrow as little as possible because you will be paying interest on what you owe.

When you fill out the application, the lender will ask you for personal information. Typically, this includes:

•   How much you want to borrow and for what purpose

•   Proof of your net income and assets

•   Your contact information and social security number

2. Compare Your Options

Getting preapproved from various lenders is critical if you want to try to get the best rates and terms. The preapproval will show you the amount of the loan you qualify for, the APR, term, and any origination fees. By comparing multiple lenders, you can find the loan that will cost you the least. Be sure to check all the fees that may apply.

If you’re trying to get better loan terms, you may want to explore adding a cosigner who has a good credit score. Doing so may help the lender view you as less of a risk, and they may be inclined to offer you a lower interest rate. However, keep in mind that if you make late payments or default on the loan, the cosigner’s credit will suffer, as will your own.

3. Gather Required Documents

Before you sit down to fill out an online application or visit a bank or credit union, gather all the documents you will need. These will likely include:

•   ID, such as your driver’s license or passport

•   proof of address, such as a recent utility bill

•   proof of employment and earnings (paystub)

•   your social security number

•   your education history

4. Apply for a Personal Loan

Once you have all your documents on hand, you are ready to fill out either an online or in-person loan application. If you are applying online, you will be required to scan the documents and upload them with the application.

Recommended: Exploring the Pros and Cons of Personal Loans

How Long Does It Take to Get a Personal Loan?

The amount of time it takes for your loan application to be approved and processed depends on the lender. Online lenders tend to be the fastest. Submitting the application online only takes a few minutes, provided you have all your documents on hand, and approval can take one or two business days. You can expect to see the funds deposited into your bank account within one to three business days of approval.

Banks and credit unions, on the other hand, tend to be slower. You may need to apply for a loan in person and, depending on your relationship with the institution and your financial history, getting approved could take one to three business days. You might need to wait three business days or more to receive the funds.

Does Everyone Get Approved for a Personal Loan?

Not everyone is approved for a personal loan. Lenders consider your credit score, payment history, income, and debt-to-income ratio when deciding whether to approve someone for a personal loan.

Credit Score

The higher your credit score, the lower your interest rate will be. This is because if your credit history is good, the lender considers you low risk. A high interest rate is what protects a lender from the risk of lending to someone who might default on the loan. A score of 640 or more is generally considered enough for a borrower to potentially qualify for a loan from some lenders. If your credit score is low, consider bringing on a willing cosigner with a better credit score.

Payment History

How you’ve managed loan payments in the past is something that a lender will consider. If you have paid off loans on time and made timely credit card payments, the lender may not consider you high risk and could be more likely to approve your application. If you have a history of late payments, however, you might find it more difficult to get approved for a loan.

Income

Lenders want to make sure you can pay back what you borrow. They’ll look at your income to make sure it is steady and that you can afford to make the payments each month. Some lenders might request your W-2 tax forms, bank statements, or recent pay stubs. Others could require verification from your employer of stated income and to confirm current employment.

Debt-to-Income Ratio

Your debt-to income (DTI) ratio shows how much you are already paying toward debt each month and is an indicator of how well your current income can cover an additional monthly loan payment. If you have no spare cash left over after paying existing debts, such as credit cards and mortgage, you likely cannot make the payments on a personal loan. A DTI ratio of 35% or lower is considered favorable for a personal loan.

What Do You Do If You Are Denied a Personal Loan?

There could be many reasons your loan was declined. Your credit score might not be high enough, your DTI ratio could be too high, or perhaps you failed to provide the right paperwork. Find out why your loan was denied so that you can fix the problem.

If your loan application is declined,you can receive a free copy of your credit report. Check that the information on the report is accurate. See if you can boost your credit score by opening new accounts that report to the credit bureaus (if you’re trying to establish your credit), maintaining low balances, and making on-time payments.

Note that applying too often for new loans or accounts triggers hard credit checks, which can lower your credit score. Another option is to find a cosigner. A cosigner with a good credit rating might help you to secure a personal loan with a favorable rate.

If you have a high DTI ratio, you might have to pay down some of your existing debt in order to receive a loan with good rates. Alternatively, you might consider taking out a smaller personal loan and supplementing the rest from other sources.

💡 Quick Tip: Generally, the larger the personal loan, the bigger the risk for the lender — and the higher the interest rate. So one way to lower your interest rate is to try downsizing your loan amount.

The Takeaway

When it comes to applying for a personal loan, you have a few different sources to explore: banks, credit unions, and online lenders. Each has advantages and disadvantages.

To find the best loan rates and terms available to you, consider getting preapproved from multiple lenders and seeing which loan will cost you the least. You’ll also want to gather essential documents before you fill out the application. This may include your ID, proof of address, proof of employment and earnings, social security number, and education history. If your loan application is declined, find out what the issue was so you can fix it. The solution may involve boosting your credit, lowering your debt-to-income ratio, or taking out a smaller personal loan.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. Checking your rate takes just a minute.

SoFi’s Personal Loan was named NerdWallet’s 2024 winner for Best Personal Loan overall.

FAQ

Does everyone get approved for a personal loan?

Individuals may be denied a loan from a lender because they do not meet the requirements. A lender will consider your credit score, payment history, income, and debt-to-income ratio when deciding whether to qualify you for a loan. You also are required to submit documentation, such as proof of identity, residency, income, and your social security number.

What do you do if you are denied a personal loan?

If you are denied a personal loan, find out the reason why. Lenders are required to issue an adverse action notice informing you why you were denied. The most common reasons are a low credit score, a poor payment history, a high debt-to-income ratio, insufficient income, or failure to provide the right documents. If your credit score is too low, check your credit report for inaccuracies. Then, you might have to take steps to improve your score.

If your debt-to-income ratio is too high, try to pay down some of your debt. Other options are to apply for a smaller loan, find a cosigner with a good credit score, request a cash advance from an employer, or ask family or friends.

How long does it take for a personal loan to be processed?

A bank or credit union might take up to a week to deliver funds to your account. However, online lenders deliver funds within one to five days once you are approved.

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Photo credit: iStock/PeopleImages

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Checking Your Rates: To check the rates and terms you may qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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Congrats, you got into college. That’s a shining achievement in its own right. Now you’re ready for some secrets to help you excel once you pass through the gates — be they ivy-covered, steelbound, or on a virtual campus you. It turns out that rising to the top of your class academically, like cream in a farm milk bottle, can have important benefits for Gen Z.

With the cost of college still rising (counting room and board, a private college can run up to $80,000 per year, and a public college, up to $30,000 or more), getting straight A’s can help you in key financial ways. It can put you on track for a lucrative career or give you an edge in a competitive internship field.

Our mini crash course has info on:

•   Getting into a college major that can lead to a high-paying career

•   Good study habits for nailing A’s

•   Whether colleges care about your GPA

•   Whether employers look for straight A’s in college.

What Is a 4.0 GPA in College?

Your GPA (grade point average) is a number that shows your academic standing, based on the grades you get in all classes. The scale starts at the top with 4 (for an A), 3 (B), 2 (C), 1 (D), and O (for F, or failing). A 4.0 GPA means you aced every class and got straight A’s in college.

Do Colleges Care About Straight A’s?

To get in the college door, the answer is often yes. Many college admissions teams do notice straight A’s in a quest to enroll the best and brightest high school students.

Once you are on campus, your college may not expect all A’s, but some colleges and universities may require a minimum GPA in introductory courses before allowing students to declare a popular major that typically brings lucrative returns later. The list includes mechanical engineering, computer science, nursing, finance, and economics. These universities want students of the highest academic caliber for the highest-earning majors.

Another reason colleges care about your grades: You need to maintain a certain GPA as a sophomore, junior, and senior to continue to qualify for federal student aid. In order to maintain eligibility for federal student aid, including federal loans and grants, students need to meet their school’s standards for Satisfactory Academic Progress (SAP). Each college is allowed to set its own minimum GPA. (Look into a private student loans guide for other lending options.)

Recommended: What Are Merit Scholarships?

Merit scholarships may also have minimum GPA requirements, so maintaining a high academic standard may be important for maintaining eligibility for merit awards as well.

Do Employers Look at Your GPA?

GPA, a benchmark once widely used by employers, is now considered by fewer than half, according to the Job Outlook 2022 survey by the National Association of Colleges and Employers (NACE). That’s a dip from five years ago, when, according to NACE, 67.5% of respondents said they used GPA to identify promising candidates. The survey found that among businesses that use GPA as a screening tool, 3.0 is the most common cutoff.

According to NACE, the trend away from using GPA appears to reflect awareness that GPA screening may not build an inclusive workforce and can be a disadvantage to students who balance school with work and other responsibilities. Also, as employers compete for talent, they are reevaluating long-used screening tools.

How Hard Is It to Get a 4.0 in College?

Whether you’re getting all A’s often depends on your major, the courses you take (organic chemistry, anyone?), and even the college you attend. But chasing a 4.0 can be hard on your life balance. If all you do is study, with no sleep, social life, or campus activities, your health and mental well-being may suffer.

Instead of overemphasizing your GPA, it may help to also focus on how you’re challenging yourself. A GPA is just one measure of your coursework.

Tips for Getting All A’s in College

If you are after all A’s, this action plan could help you achieve your goal.

Select a Major That You Are Passionate About

College is the time to immerse yourself in subjects that enthrall, inspire, and move us, whether that means microbiology or British literature. But if your mind is in the art world and your nose is in a sociology book, your interest can wane, and you may be far less likely to excel. Choose a major that ignites your brain power and A’s will be more attainable.

Time Your Classes Well

When are you most alert? Are you wide awake in the morning and dragging by 5? Schedule classes accordingly. Can you focus on a weekly 3-hour seminar or would you do better with a shorter class that meets more often? Know thyself, and how you learn and work most productively.

Take Advantage of Professors’ Office Hours

If a calculus formula is not crystal-clear or you want to talk a little more about that short story structure, stop by your professor’s office during posted hours or pop in virtually if that’s an option. Professors post hours so students can get the help they need.

Practice Good Time Management

Make an organized schedule. Use Google Calendar on your phone or get an actual planner with paper pages. (Relieve stress with stickers and doodles. Get pretty markers at the campus bookstore.) Don’t double-book time slots, whether for a study/coffee date with a classmate or your shift at the campus newspaper.

Closely Track Grades

Don’t wait until the end of the semester to see what your average is in Italian class. Keep up to date on every grade and pump up your study efforts if necessary.

Set Study Time Blocks

Build them in wherever and whenever possible. Several short sessions can be as productive as one long one. Review and study notes from day one, to start building a bank of knowledge. When studying, turn off your phone and leave it in your backpack. Avoid looking at emails or other digital distractions. Take notes on relevant readings and review and organize class notes each week so you don’t have to cram come exam time.

Plan your study location based on the lowest possible risk of distractions, such as a roommate who might want to order wings and binge watch the latest Netflix original. Adjust times and places as needed; be flexible. Maybe 30 minutes at Starbucks between classes is all you have one day. But if you block out two hours to study, stick to it. Consider enlisting a study buddy.

Benefits of Getting Straight A’s in College

Excelling in your classes can bring perks like these.

Dean’s List Recognition

The dean’s list, a term dating to the early 14th century, comes from the Latin decanus (“head of a group of 10 monks in a monastery”). You, of course, are at college, not a monastery, but you are at the head of the class when you make the dean’s list.

The distinction is usually reserved for full-time students at a specific GPA. Being on the dean’s list could help you stand out in a field of applicants for plum internships and summer jobs. Consecutive semesters on the list show you can achieve and maintain high standards.

Scholarships and Grants

Straight A’s can potentially translate into money to help pay college bills. Some scholarships have GPA requirements; read the fine print.

Merit-based college grants are awarded to students who demonstrate high levels of academic achievement, a commitment to community service, or excellent leadership skills. While you may not need straight A’s to qualify, it won’t hurt to strive for the gold and set a high bar for yourself.

Recommended: Merit Aid for College

The Takeaway

Getting all A’s in college can bring big benefits, from helping you secure a place in a crowded major with lucrative career returns (such as engineering or computer science) to earning you a place on the dean’s list, a marker that helps you stand out in a competitive internship field. With the right study skills, you can seriously up the odds of acing your classes.

3 Student Loan Tips

1.    Can’t cover your school bills? If you’ve exhausted all federal aid options, private student loans can fill gaps in need, up to the school’s cost of attendance, which includes tuition, books, housing, meals, transportation, and personal expenses.

2.    Even if you don’t think you qualify for financial aid, you should fill out the FAFSA form. Many schools require it for merit-based scholarships, too. You can submit it as early as Oct. 1.

3.    Would-be borrowers will want to understand the different types of student loans peppering the landscape: private student loans, federal Direct subsidized and unsubsidized loans, Direct PLUS loans, and more.

Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

What is a 4.0 GPA in college?

A 4.0 GPA (grade point average) means you have an A in all of your classes.

How do you become a straight-A student?

Getting straight A’s takes diligence, good study skills, and some planning. It also depends on the courses you take. It generally helps to pursue a major that taps into your passions and strengths. Are you more comfortable with a paintbrush or camera than in a science lab? Then fine arts classes will be easier for you to ace.

Do colleges care about straight A’s?

Colleges may not care if you get straight A’s, but some schools may require students to have a minimum GPA in introductory courses before allowing them to declare a popular major that typically brings lucrative returns in the work world. The list includes mechanical engineering, computer science, nursing, finance, and economics. Another reason to watch your GPA: Federal student loans and many scholarships and grants have a minimum GPA requirement.

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Photo credit: iStock/Luis Echeverri Urrea

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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Your personal cash flow — or, how much money is coming and going through your personal budget on a regular basis — always has room for improvement. You can improve your cash flow, too, through various means, such as asking for a raise, starting a side hustle, and more. That, of course, paired with cutting excess spending, can help improve your financial standing.

In a sense, you’re your own chief financial officer, or CFO, and in charge of doing what you can to stay on top of your finances. With that, there are a multitude of things you can do to improve your personal cash flow. But if you want to pare that to-do list down, you can start with six key actions.

1. Ask for a Raise

A salary increase is perhaps the easiest and quickest way to improve your personal cash flow — and it requires the least amount of effort. But you must first muster the confidence to ask for one, and prepare yourself for a meeting with your boss to make sure you end up getting a raise.

Unfortunately, most employees may be reluctant to ask for a raise — in many cases, because they believe it’s awkward to talk about money with a manager. Managers, however, are not necessarily looking for ways to increase their expenses. So, if you want a raise, you’ll likely need to take action rather than waiting for one to fall out of the sky. That will require having an idea of what your market value is, and what your employer can realistically afford.

You can always look for another job, too.

2. Start a Side Hustle

A side hustle is simply a second or secondary job, and many people employ them to bolster their earnings. There can be many benefits to having a side hustle, with the extra cash, of course, likely being the most obvious.

For instance, by taking on additional projects, you’ll gain experience that will pad your resume and uncover opportunities to make new connections. You might even find yourself entertaining an offer for a new — and better paying — position. If you don’t know where to start, either, some low-cost side hustles include tutoring, flipping furniture, or even digital marketing.


💡 Quick Tip: Look for an online brokerage with low trading commissions as well as no account minimum. Higher fees can cut into investment returns over time.

3. Track Your Spending

Increasing your income is part of the equation, but slowing your cash outflows is also critical. That means tracking your spending, and finding ways to slow that spending in order to save more.

There are also services out there that can help you not only track your spending, but analyze that spending, too, and find opportunities to cancel services you barely or never use. An internet search will reveal several of them. Reviewing your bank statements, too, should help you find other areas where spending could potentially be cut.

You can also try measures such as only using cash to keep your spending under control, along with other strategies.

4. Simplify Your Life

Selling everything and moving to a tiny house may sound nice, but if you were to actually do it, you may find yourself missing some of the modern world’s creature comforts. With that in mind, if you want to simplify your life (and financial situation), it may sound like a good idea — but you should take some time to think about what you really need, and what you can do without.

For instance, many people could probably cut their clothing budget without too much trouble. But is it possible to also downsize and relocate to a new apartment in a less trendy but more affordable area? What about clearing out that storage unit that you’re spending money to rent? Simplifying your life could result in savings, but there’s a lot of thought that should go into any big life changes before they’re made.

5. Review Your Debt

Being your own CFO means that your finances — including your debt — are under your control. As such, you’ll need to know what debts you have racked up, including credit card debt, student loan debt, auto loans, personal loans, and more. It can be difficult to face your debts head-on, but if you’re serious about improving your financial standing, it’s a critical step to take.

Also, take a look at your debt to income ratio — your monthly debt payments divided by your gross monthly income. Let’s say your gross monthly income is $7,000, but each month you pay out $1,500 for rent, $600 for credit card bills, $500 for student loan payments, and $600 for other debt. Your debt to income ratio is 46% ( $3,200 divided by $7,000). A high debt to income ratio — typically over 43% — makes you riskier to potential lenders, and can cost you a new loan with a good rate.

Imagine bringing your rent down to $1200, knocking $200 off that credit card payment each month, and bringing your student loans down to $300; your debt to income ratio would decrease to just 36%.

Investing With SoFi

Improving your personal cash flow — a critical step to take if you want to be your own personal CFO — is important for just about everyone. Finding ways to increase your earnings or income, while also finding ways to pare down expenditures, should help you reach your financial goals in the long term. There will be hiccups along the way, of course, but with some discipline and know-how, it’s doable.

And don’t forget to share what you’ve learned; you probably know someone who could use the advice. Support and encourage your friends, and then help each other stick to individual goals. As always, if you want more guidance, you can get in touch with a financial professional.

Ready to invest in your goals? It’s easy to get started when you open an investment account with SoFi Invest. You can invest in stocks, exchange-traded funds (ETFs), mutual funds, alternative funds, and more. SoFi doesn’t charge commissions, but other fees apply (full fee disclosure here).

For a limited time, opening and funding an Active Invest account gives you the opportunity to get up to $1,000 in the stock of your choice.

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SoFi Invest®
INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE
SoFi Invest encompasses two distinct companies, with various products and services offered to investors as described below: Individual customer accounts may be subject to the terms applicable to one or more of these platforms.
1) Automated Investing and advisory services are provided by SoFi Wealth LLC, an SEC-registered investment adviser (“SoFi Wealth“). Brokerage services are provided to SoFi Wealth LLC by SoFi Securities LLC.
2) Active Investing and brokerage services are provided by SoFi Securities LLC, Member FINRA (www.finra.org)/SIPC(www.sipc.org). Clearing and custody of all securities are provided by APEX Clearing Corporation.
For additional disclosures related to the SoFi Invest platforms described above please visit SoFi.com/legal.
Neither the Investment Advisor Representatives of SoFi Wealth, nor the Registered Representatives of SoFi Securities are compensated for the sale of any product or service sold through any SoFi Invest platform.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Claw Promotion: Customer must fund their Active Invest account with at least $25 within 30 days of opening the account. Probability of customer receiving $1,000 is 0.028%. See full terms and conditions.

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