According to Finder’s Consumer Confidence Index, a high majority of respondents are stressed about their finances, and 23% say they can’t manage without using a credit card. But the high interest rates of a credit card can make some borrowers look for a better option. A personal line of credit can be a good choice when you need to tackle a large expense.
Many borrowers use their lines of credit to cover home improvements, clean up unexpected debts or even to consolidate their existing debt. Some credit line programs are even designed to help boost your credit score. But the programs vary by lender, whether it’s the amount of money you can borrow or the fees you’re required to pay. We’ve gathered some of the best lenders who offer lines of credit so you can find the one that best meets your needs.
50+ personal loan lenders reviewed and rated by our team of experts
6+ types of personal loans analyzed
Evaluated under our unbiased rating system covering 9 categories
20+ years of combined experience covering financial topics
We're big on editorial independence. That means our content, reviews and ratings are fair, accurate and trustworthy. We don't let advertisers or partners sway our opinions. Our financial experts put in the hard work, spending hours researching and analyzing hundreds of products based on data-driven methodologies to find the best accounts and providers for you. Explore our editorial guidelines to see how we work.
Best overall
U.S. Bank unsecured lines of credit
2.8
★★★★★
Finder score
While U.S. Bank lines of credit are only available to current account holders, it's still the best option from a bank out there. There are no annual fees, and rates can run as low as 12.5%. You'll also have flexible access to your funds: U.S. Bank issues borrowers a Visa Access Card and personal checks, and you'll be able to make a draw online, in the U.S. Bank mobile app or at a branch.
Available in all states
Pros
Flexible ways to make draws
Unsecured LOC that doesn't require collateral
Cons
Limited to current U.S. Bank customers
Doesn't disclose draw and repayment periods online
Loan amount
Up to $25,000
APR
12.50% to 22.50%
Interest Rate Type
Variable
Min. credit score
680
Min. credit score
680
APR
12.50% to 22.50%
Loan amount
Up to $25,000
Best regional bank
Regions Bank personal loans
4.2
★★★★★
Finder score
Regions Bank offers three lines of credit, both secured and unsecured, but its unsecured Preferred Line of Credit is the most popular. You must have an established deposit account with the bank in order to apply, but that prior relationship can get you between 0.25% and 0.50% in interest rate discounts on your credit line.
You can access your funds through online banking transfers, over the phone, or in person using checks from your account, but this account doesn't come with a debit card like many of its competitors. There are no limits on how you can use the funds from your credit line.
Available in: Alabama, Arkansas, Florida, Georgia, Illinois, Indiana, Iowa, Kentucky, Louisiana, Mississippi, Missouri, North Carolina, South Carolina, Tennessee, Texas
Pros
Can be used to cover deposit account overdrafts
Up to 0.5% in relationship discounts
Offers unsecured and secured credit lines
Cons
Must have a deposit account with the bank for at least six months
Tally is an app that offers a line of credit designed to help you pay down your credit cards. It accepts borrowers with fair credit, and you'll have access to an automated Tally Advisor that will help you develop a strategy to pay down your debt and save money on interest. You can also have the app take over managing your credit card payments, which comes with late fee protection. This can help you save on pesky fees and can also improve your credit by establishing a history of on-time repayments.
Available in: Arkansas, California, Colorado, Connecticut, District of Columbia, Florida, Georgia, Idaho, Illinois, Iowa, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Missouri, New Jersey, New Mexico, New York, Ohio, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Washington, Wisconsin
LendingTree is a top-tier connection service that works with multiple lenders. You only need to fill out one application to see personal line of credit options across the country. And if you become eligible for a better rate from one of its providers, you'll be alerted as soon as possible so you can make an informed decision on your line.
Available in all states
Pros
Multiple lenders in network
One application
Quick alerts for better deals
Cons
May receive high volume of marketing materials
Good to excellent credit required
Loan amount
$1,000 to $100,000
APR
Varies by lender
Interest Rate Type
Variable
Min. credit score
Good to excellent credit
Turnaround Time
If you apply during work hours on a business day you can get access to approved funds within 24 hours.
Elastic offers a line of credit that could be a cheaper alternative to a high-cost payday loan if you use it wisely. While your credit line is limited compared to options that require good credit, that's not necessarily a bad thing. It can help you pay for short-term expenses without racking up thousands of dollars in excess debt. Instead of charging interest, it charges a 5% to 10% cash advance fee for each draw, as well as a carried balance fee that ranges from $5 to $350 each month. Paying off your balance as quickly as possible can help keep the cost from equaling an APR in the triple digits.
Not available in: Colorado, Connecticut, Georgia, Hawaii, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Vermont, Virginia, West Virginia
Pros
Open to all credit types
Employment isn't required &mdash
will accept government benefits as income
Wide state availability
Cons
Cash advance fee for each draw
Carried balance fee on repayments
Cooling off period after carrying a balance for 10+ months
Truist offers same-day funding on its personal line of credit as long as you apply on a banking business day and have all of your documentation in order. You can access your funds through banking transfers online or using your mobile app.
Truist's unsecured line of credit makes our list for best lines of credit because it offers funds up to $50,000 with no application fee, no fee to take a cash advance and no annual fee. However, with at least $100,000 in eligible investments, you can also look into its secured line of credit, which offers $25,000 to $250,000.
Available in: Alabama, Arkansas, California, District of Columbia, Florida, Georgia, Indiana, Kentucky, Maryland, Mississippi, New Jersey, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, West Virginia
Pros
Can fund same-day
No application, cash advance or annual fees
Offers several credit line options
Cons
Not available in all states
No relationship discounts offered
Loan amount
$25,000 to $250,000
APR
13.69% to 17.99%
Interest Rate Type
Variable
Min. credit score
Not stated
Min. credit score
Not stated
APR
13.69% to 17.99%
Loan amount
$25,000 to $250,000
How we picked the best providers
We compare dozens of lenders before narrowing down to the best personal lines of credit in the current market, and we regularly review our selections. Factors with the most weight in our methodology include fees, line amounts, interest rates, reputation and customer reviews. For HELOCs, we included additional factors such as closing costs, application fees and home equity requirements.
The 15 factors weighed in our methodology for the best lines of credit are:
Minimum and maximum APR
Annual fees
Minimum credit score required
Minimum and maximum credit limit
Interest rates and intro rates
Relationship discounts
Draw period
Repayment term
Flexible repayment options
Better Business Bureau ratings and reviews
Trustpilot ratings and reviews
Turnaround times
Number of states served
Closing costs
Home equity requirements
How does a personal line of credit work?
A personal line of credit (LOC) is very similar to a credit card, with a few notable differences.
Like a credit card, you qualify for a credit limit, which you can withdraw from as needed. But unlike a credit card, you receive cash when you draw from a LOC. Because the funds come in cash, you also may need to wait up to 48 hours for the bank to transfer your withdrawal.
Most lines of credit come with variable rates, but fixed-rate options do exist. While there are options to back your LOC with collateral, unsecured options are more common. And extra costs with some LOCs can include application fees, draw fees, maintenance fees, origination fees and possibly annual fees.
Revolving vs. nonrevolving LOCs
There are a few different types of personal lines of credit, which affect how long you have access to the funds:
Revolving lines of credit are the closest to a credit card. You withdraw and pay down the balance as needed, and funds are available until you decide to close the account.
Nonrevolving lines of credit are a one-time transaction. You withdraw from the credit line as needed, but the LOC closes once you reach the credit limit.
HELOCs and nonrevolving LOCs come with two phases: draw and repayment periods. During the draw period, you withdraw money as needed and you only pay interest. After the draw period, you enter the repayment period and pay off the balance in installments.
Repayment structures on both revolving and nonrevolving lines of credit can also differ. Many revolving lines of credit only require minimum monthly payments on the balance and interest, similar to a credit card. But in some cases, both revolving and nonrevolving LOC lenders will turn each withdrawal into a short-term loan, requiring monthly payments in interest and fees.
How to get the best personal line of credit in 6 steps
Checking your credit and narrowing down lenders are key in landing the right line of credit for your situation.
Check your credit. With many big-name lenders, you may need a credit score in the 700s, and borrowers with the best credit scores can get the most competitive rates. While you’re comparing options, work to improve your credit so you nail down the best possible rates and terms.
Figure out what type of LOC you want. Revolving or nonrevolving? Fixed rate or variable rate? Determine which LOC would be best for you to more quickly narrow down lenders.
Compare rates and fees. Lenders vary widely in the minimum and maximum rates they offer. If you don’t have the best credit, look for lenders that have a low maximum rate. And note any fees: You may have to pay some combination of annual fees, monthly fees and draw fees.
Understand the repayment process. Some LOCs require interest-only payments during a draw period, and then minimum monthly payments during the repayment period. But some lenders might turn each draw into a term loan — ask lots of questions about repayments to choose the option that makes the most sense for you.
Compare funding methods. LOCs typically allow you to withdraw as you need, but the funding times may not be immediate. Some lenders may only allow bank transfers, while others might provide a debit card or checkbook to make withdrawals easier.
Apply and get the LOC. With all the details of what you want ironed out, apply with the lenders of your choice. Secured options may take a few weeks to finalize, but unsecured options can be available in a matter of days.
How to qualify for a line of credit
Requirements vary by lender, but plan on needing a good credit score above 670 and enough income to repay the loan. Some lenders are flexible on creditworthiness, such as Elastic, which is open to all credit types.
When it comes to debt-to-income (DTI) and payment-to-income (PTI) ratios, the requirements vary by lender. However, many lenders prefer a DTI below 36% — the lower the better. For a PTI ratio, lenders tend to prefer less than 20%. But again, these requirements vary by lender and the amount you’re applying for.
When it makes sense to get a personal line of credit
If you need a flexible way to borrow, a personal credit line can make a lot of sense.
You have ongoing projects or expenses. If you’re in the midst of home improvements, medical expenses, getting married or have a startup, a personal LOC can help with these plans that don’t have a set end date or shifting budgets. This can help you avoid taking out multiple personal loans.
Your income isn’t steady. Maybe you’re a freelancer or work in a seasonal industry. A personal LOC can help cover regular expenses when your income is sporadic.
You need an emergency fund. If your rainy-day funds were recently drained or you’ve never had an emergency buffer, then a personal LOC can provide some security.
You want to consolidate debt. If you have high-interest debt from multiple creditors, a LOC can help with consolidating that debt. But aim for an LOC with a lower interest rate than the average interest rate of your debted accounts, or you may not save money long-term.
Interest rates are low. Most personal LOCs have variable rates, so they rise and fall with the prime rate. If rates are low, then using an LOC to cover expenses can be an affordable way to borrow.
When to avoid a personal line of credit
A personal line of credit isn’t the right choice all the time.
When interest rates are high. Many lines of credit have variable rates, so when the prime rate is up, it’ll cost you more to borrow. However, watch the market for the most advantageous times to withdraw and repay quickly for maximum savings.
You only have a singular one-time expense. Using an LOC to cover one expense, like a single bill, may be a little excessive. LOCs are better suited for ongoing projects where you don’t know the full cost.
You’re at risk for overspending. If you think you could rack up charges on the line of credit, then avoiding this borrowing method may be wise. LOCs often come with high limits, opening up the opportunity to overspend and financially overextend yourself.
You can use a credit card. If you already have a credit card with a low interest rate and a large borrowing limit, you may be able to avoid taking on more debt.
Alternatives to a personal line of credit
Depending on what you need the line of credit for, you may have other borrowing options.
Personal loan. If you know how much you want to borrow, then taking on a personal loan may be a simple alternative, offering lump sum funding and a fixed interest rate.
Credit card. For some borrowers, it may be easier to qualify for a credit card. While it’s likely that you may get higher interest rates, banks and credit unions often advertise promotional rates that you can take advantage of — if you’re quick to pay off the balance.
Cash advance apps. Great for small, one-time expenses, many cash advance apps don’t charge interest, but instead charge a flat fee. And they’re known for same-day turnaround times.
HELOC. If you have a lot of equity in your home, a HELOC can give you all the advantages of a personal line of credit, but often with a lower interest rate. Just be sure you don’t default, or you could risk foreclosing on your home.
Compare LOC alternatives
Narrow down top loans and LOCs by APR, loan amounts and credit score requirements to find the best lender for your situation. Select Compare for up to four products to see their benefits side by side.
Bethany Hickey is a personal finance writer at Finder, specializing in banking, lending, insurance, and crypto.
Bethany’s expertise in personal finance has garnered recognition from esteemed media outlets, such as Nasdaq, MSN, Yahoo Finance, GOBankingRates, SuperMoney, AOL and Newsweek. Her articles offer practical financial strategies to Americans, empowering them to make decisions that meet their financial goals. Her past work includes articles on generational spending and saving habits, lending, budgeting and managing debt.
Before joining Finder, she was a content manager where she wrote hundreds of articles and news pieces on auto financing and credit repair for CarsDirect, Auto Credit Express and The Car Connection, among others.
Bethany holds a BA in English from the University of Michigan-Flint, and was poetry editor for the university’s Qua Literary and Fine Arts Magazine.
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