Best Personal Loans for Medical Expenses

Contributor, Benzinga

When your health or the health of your loved one starts to falter, worrying about how you’ll pay what your insurance doesn’t cover makes a stressful time more difficult. Or, maybe you’re looking into a cosmetic or elective procedure that isn’t covered by insurance at all.

A personal loan may be your solution when you need money to pay for a medical expense. They’re 1 lump sum payment loans that you repay in installments, often at a low rate, making them perfect for large expenses.

If you’re interested in a personal loan to cover your medical expenses, look no further. Check out Benzinga’s list of the best personal loans for medical expenses to start loan shopping today.

Best Personal Loans for Medical Expenses

While nobody wants to go into debt to cover medical costs, it’s a situation many of us find ourselves in. A personal loan can be a low-cost, fast way to get funding. It can also be a great way to consolidate credit cards with high balances or consolidate medical debt while keeping your credit intact. 

A personal loan used to consolidate credit cards can raise your over credit limit while lowering your overall credit use. This will look good for your credit utilization, an important factor in credit approval. 

APR
Fixed 5.99% – 24.99%.
Loan Amounts
$5,000 – $40,000
APR

Fixed 5.99% – 24.99%.

Origination Fee

0%–5% of the loan amount

Term Lengths

2–5 years

Min Credit Score

550

1 Minute Review

Happy Money offers personal loans that allow you to more efficiently consolidate high interest payments. Happy Money was previously known as Payoff. The company was founded in 2009 and has since helped fund over $3.5 billion in loans. Happy Money is a financial company that works with approved lending partners to fund loans. Happy Money designed its Payoff Loans to provide borrowers with the financial freedom and power to be matched with a lending partner. Benzinga reviews Happy Money Loans as a way for people to consolidate debt with potentially lower APR rates. 

Best For
  • People with lower credit scores
  • Credit card debt consolidation
Pros
  • No prepayment fees
  • Potentially lower APR rates starting around 5.99%
  • Improve credit score
Cons
  • Personal loans only available for credit card debt
pre-apply securely through Figure Personal Loans’s website
APR
Between 5.99% and 15%; autopay discount of 0.25%
Loan Amounts
$5,000 – $50,000
APR

Between 5.99% and 15%; autopay discount of 0.25%

Origination Fee

Between 0% and 5% (dependent on state and local laws)

Term Lengths

Fixed-rate loan terms of 3 or 5 years

Min Credit Score

680

1 Minute Review

Figure’s online personal loan application process eliminates the painstaking process of following up your paperwork to scan or send to the lender. With an entirely online application, you can get your prequalification rate without impacting your credit score. You’ll get approval within a few minutes and await funding in as little as 2 business days — up to $50,000 you can direct toward what matters most.

Figure personal loans come with multiple fixed term options so you can map out your payment schedule so that it doesn’t strain your finances. Figure also offers some perks for spreading the word out to others. You’ll receive a $150 gift card for every friend you refer, and they too will get a $150 gift card when their loan funds.

Figure’s home equity line of credit lets you turn your home equity into up to $250,000 cash in as few as 5 days. Rates start as low as 2.88% APR1, and you can choose among 5-, 10-, 15- and 30-year fixed term options. You can also get up to $500,000 cash-out in mortgage refinance, all with custom rate and payment options.

While you can easily land better rates with a higher credit score, Figure also has options for applicants with less than perfect credit. You may secure a HELOC with a credit score as low as 620 (except in Oklahoma where the minimum is 720).

Best For
  • Online loan application
  • Unsecured loans
  • Affordable loan fees
Pros
  • 100% online application
  • Quick funding
  • Competitive rates
  • Stellar customer service
  • Multiple fixed term loan options
  • A gift card for every referral (personal loan only)
  • Personal loan offered in all 50 states
Cons
  • Products not available in some states
  • Personal loans capped to $50,000
get started securely through SoFi’s website
Disclosure: Fixed rates from 6.99% APR to 21.78% APR. APR reflect the 0.25% autopay discount and a 0.25% direct deposit discount. SoFi rate ranges are current as of 3/24/22 and are subject to change without notice. Not all rates and amounts available in all states. See Personal Loan eligibility details. Not all applicants qualify for the lowest rate. Lowest rates reserved for the most creditworthy borrowers. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, income, and other factors. See APR examples and terms. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.
APR
9.95%-35.99%
Loan Amounts
$2,000-$35,000
APR

9.95%-35.99%

Origination Fee

Up to 4.75%

Term Lengths

24-60 months.

Min Credit Score

580

1 Minute Review

Established in 2012, Chicago-based Avant helps people obtain personal loans while offering transparent credit. Since its inception, Avant has helped over 1.5 million people receive funding. 

One thing that makes Avant so unique is its background as a financial technology company instead of a traditional bank. Banking needs are addressed by Evolve Bank & Trust, a member of the Federal Deposit Insurance Corp. (FDIC). The FDIC insures deposits and protects consumers in case of bank disasters. Benzinga’s review of Avant determined it is a strong option for personal loans because of its reputation for positive customer experiences and fast funding options. 

Best For
  • People with below-average credit scores who need unsecured personal loans
  • People who need fast funding
Pros
  • Quick funding
  • Fixed payments
  • Mobile accessibility
Cons
  • Additional costs such as origination fees
  • No third-party guarantor such as a co-signer on a secured personal loan
Disclosure: *AutoPay discount is only available prior to loan funding. Rates without AutoPay are 0.50% points higher. Excellent credit required for lowest rate. Rates vary by loan purpose.
APR
3.49%- 19.99%
Loan Amounts
$5,000 – $100,000
APR

3.49%- 19.99%

Origination Fee

$0

Term Lengths

Up to 240 months

Min Credit Score

660

1 Minute Review

LightStream was founded by its parent company Truist Financial. The company offers a wide range of traditional and innovative personal loan benefits and opportunities such as home improvement loans and fertility financing to address a wide range of needs. The company charges APRs between 3.49% and 19.99%. Benzinga offers a review of LightStream’s personal loan options that provide a variety of personal loans while minimizing additional fees and promoting financial flexibility. The company offers diverse loans with varying term lengths, APRs, and uses. For example, Lightstream offers a variety of home improvement loans that are designed to assist with specific needs such as funding for landscaping or solar panels.

Best For
  • Potential borrowers interested in quickly funded unsecured personal loans
  • Same day funds
  • People with stronger credit scores
Pros
  • Doesn’t require collateral
  • No late fees
  • Potential same day funding
  • Self-selected funding dates
  • Offers a mobile application to ease access to loan information
Cons
  • Not recommended for bad credit scores

Types of Personal Loans for Medical 

As with most loans, your credit history will determine your loan offers. And, your unique financial situation will determine what type of loan you’ll choose. While you can typically expect personal loans to be similar in structure, there are different types. You may be provided offers for secured or unsecured loans, for example, or have to choose from a fixed or variable rate loan. 

Secured Loans

If a lender offers you a secured loan, they are requesting collateral to back the loan. If you’re requesting a high loan amount or have slightly spotty credit, this may be the lender’s way of reducing their own risk.

Be sure you repay these loans by their terms to the letter — if you default on your agreement, your collateral could be seized in addition to your credit taking a blow.

Unsecured Loans

You won’t have to put up any collateral for an unsecured loan; they should be taken just as seriously as a secured loan. Unsecured loans are backed only by your creditworthiness as a borrower. If you default on your loan, your credit report could be negatively affected.

Fixed-Rate vs. Variable-Rate Loans

Lenders offer fixed or variable interest rates loans. You may have the option to choose between the 2 types of rates.

Fixed-rate loans have interest rates that remain static throughout your loan. These are useful because you can calculate the exact amount the loan will cost you. 

Variable-rate loans have interest rates that can fluctuate throughout your loan. While this can be inconvenient, you don’t know exactly how much the loan will cost you — it can mean a lower rate or lower monthly payments. This could be useful if you’re strapped for cash and need lower monthly payments to make ends meet.

To compare multiple offers from multiple lenders, use a free loan comparison service like Credible. You’ll be able to easily compare lenders you qualify with. Comparing rates and terms from multiple lenders is a great way to ensure you’re getting the best terms and rates.

Personal Loan Requirements and Criteria

Different lenders have different requirements, but the following is a gold standard for what lenders look at when they are reviewing your loan application:

  • Your FICO credit score
  • Debt-to-income ratio
  • Delinquencies or negative remarks on your credit report
  • Credit utilization (your credit balance vs. your credit limit)
  • Open accounts with a positive standing (payments being made on time)

Some lenders may have loans specialized for certain types of medical procedures, like in-vitro fertilization. And while most lenders do prefer borrowers with good credit, bad credit doesn’t fully rule you out. A service like BadCreditLoans.com focuses on pairing lenders with borrowers who don’t have the best of credit. Its small loans are a great way to put some extra cash in your pocket while times are tight or to avoid paying for a medical bill with a high-interest credit card. If you keep up with your monthly payments, it’ll have a positive influence on your credit.

Personal Loan Considerations

If you’ve decided a personal loan sounds like a good solution to your financial woes, there are a couple of things to consider. Primarily, be sure you can meet all the terms and conditions set for the loan before you agree to it. Even paying a loan off before the agreed period can have consequences, with some lenders charging hefty prepayment penalties. 

Look for loans with terms and rates that are logical for you. And keep your eye out for any hidden costs or fees. Look for loans with as minimal fees as possible to avoid paying more than you bargained for. 

Although you trust that the lenders and loan comparison services on our list operate with integrity, the same isn’t true for every lender out there. Be wary of predatory lenders, especially online. If a loan seems too good to be true, be sure it’s coming from a legit source. Stray away from payday lenders and the like — these loans are often super high interest and can reduce your spending power more than getting your money early is worth. 

If you want to play it safe, use a loan comparison service like Even. You’ll have the peace of mind that you’re only connecting with trustworthy lenders, reducing your exposure to potential scammers during the loan shopping process.

Personal Loans vs. Credit Cards

While credit cards are best for covering your prescription copays or paying for other small recurring expenses, a personal loan is best suited to larger expenses or debt consolidation.   

You’ll usually get the full loan amount at once, which you’ll repay in fixed monthly installments. Personal loans often offer lower, fixed interest rates than credit cards with higher credit limits. When a personal loan is paid in full, the line of credit is closed.

Unlike personal loans, your available credit is increased by how much you pay toward your credit card balance monthly. Although you can choose how much you’ll pay off after you meet the minimum required payment, credit cards often have higher variable interest rates. For this reason, keeping low balances is ideal to avoid getting in over your head with interest.

Also, personal loans are better suited to debt consolidation. You can take your loan to repay all your debtors at once, rolling your debt over into 1 monthly payment. This makes debt management easier to budget for. 

Don’t Get Bogged Down by Medical Costs

Whether you’re installing a handicap ramp on your new house or need funding to cover a medical procedure, a personal loan could be your solution. A loan comparison service allows you to compare your prequalified loan offers side-by-side. Get in touch with one of the reputable lenders on our list for questions and a great rate.

You’re just a few clicks away from peace of mind about your health solutions. Start on your journey toward better funding today.