What Do You Need For A Personal Loan?

Today, we will look at the requirements you will need for a personal loan to help you know the right path to go when you are ready to get a personal loan. Keep on reading to get all the vital information in this article.

Personal loans are available from a variety of sources, ranging from online lenders to traditional banks. See Pros and Cons of Personal Loans.

If you decide that a bank is the best lender for your financial situation, preparing the necessary documentation in advance can help you to stay organized throughout the application process.

Documents Required For a Personal Loan

Every personal loan requires you to submit a long list of documents to prove you can handle the debt. These frequently include your personal information alongside your credit score, payment history, income, debt-to-income ratio.

You will need to specify the loan’s purpose, how much you need to borrow and how you will repay it.

Here’s what you will typically need to apply for a personal loan.

Personal information

Lenders want to confirm your identity and learn more about your financial health. The common personal information a lender requires is:

  • Name
  • Address
  • Phone number
  • Date of birth
  • Social Security number

Credit score

This is by far the most important factor. Lenders view your credit score as an indication of how creditworthy you are.

A lower credit score suggests that you might be a risky borrower. Lenders protect themselves from this risk by tacking on higher interest rates, while reserving the most competitive rates and terms for those with excellent credit.

“If your score is less than 640, you’re probably not going to find a very reasonable personal loan,” says Michael Kelley, a Cleveland-based certified financial planner.

Borrowers with high credit scores may be eligible for APRs as low as 4.37%, according to rates in LendingTree’s personal loan marketplace. Check How Personal Loan Works.

Payment history

This goes hand in hand with your overall credit score. Your payment history carries the most weight when it comes to determining your score — it makes up 35% of your FICO Score.

This is precisely why having a history of missed payments will come back to haunt you; a single late payment can stay on your credit report for up to seven years.

Lenders are looking for some degree of reassurance that you will, in fact, make good on your personal loan payments. A solid track record of making on-time payments will increase your odds of getting approved.


Before giving you the stamp of approval and issuing a check, lenders want to make sure you have a steady income to direct toward your payments.

“Outside of general credit score questions, they’re going to check into your income,” says Kelley. “They’re also going to want to know how much you want to borrow, and how long you want to borrow it for.”

Note that a shorter personal loan term translates to higher monthly payments: Let’s say you’re seeking a $15,000 loan with a repayment period of five years and an interest rate of 8%.

Your monthly payment will work out to about $304, while a three-year term means a monthly payment of about $470. Read How Long Do You Have To Wait To Get A Personal Loan?

While the shorter term means paying more from month to month, it’s actually cheaper in the long run because you would spend $1,327 less in overall interest.

Debt-to-income ratio

Regardless of the repayment period, lenders really only care about one thing: after accounting for all your other existing debt payments, can your income cover this new monthly payment? This is where your debt-to-income ratio comes into play.

your debt-to-income ratio gives lenders an idea of how much of your current income is already going toward debt. To calculate yours, add up all your minimum monthly debt payments, then divide the total by your gross monthly income.

“If the average is 35 percent or lower, you’re considered a good candidate for a personal loan,” says Laura Morganelli, a Pennsylvania-based certified financial planner.


Each personal loan lender has its own lending requirements, and you will need to provide personal documents to be considered for a loan.

Before applying for the loan, gather the required documents to help streamline the application process. It is also good to contact the lender to confirm the documents needed to process your application.

And if the lender requests additional information during their review, provide it promptly to get a loan decision sooner.

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