Discover Does Personal Loans Too? This Review Tells All
Discover is primarily known for its consumer credit card, but did you know the company also offer personal loans?
Borrowers with good credit can apply for a loan of up to $35,000 with competitive, fixed rates and flexible repayment terms.
In this Discover personal loan review, we’ll cover the criteria you need to meet to qualify, as well as what types of fees and interest rates you can expect to pay.
If you’re looking to get connected with a lender, simply fill out our form below to get started:
Discover Personal Loan Review
There are many reasons why consumers take out personal loans, including to pay for:
- home repairs and improvements,
- a wedding or honeymoon,
- a vacation,
- or some other major purchase.
Another common motivation is to consolidate debt.
Not only is it more convenient for most consumers to make a monthly payment to one lender as opposed to several payments to multiple companies, a debt consolidation loan will typically offer a lower rate than borrowers are currently paying.
This can save borrowers hundreds or even thousands of dollars in interest.
Costs
Discover offers personal loans with fixed rates ranging from 6.99% to 24.99%.
Unlike some lenders, Discover doesn’t charge closing fees, prepayment fees, or origination fees.
Since origination fees can be as large as 5% of the amount of the loan, these types of charges can easily add up to hundreds of dollars, depending on how much money you’re borrowing.
However, you should be aware that the company does charge a hefty $39 fee for late payments – which is more than most other lenders.
Keep in mind that the risk of an occasional late fee may be insignificant compared to the money you save by not paying fees that other lenders routinely charge.
Other Benefits
You also have the option to set up automatic payments, which eliminates the danger of making a late payment as long as the funds are available in your bank account when your payment is due.
Lastly, Discover allows borrowers to change their payment due date online, offering greater control and flexibility than most other loan providers.
Is a Discover Personal Loan Right for Me?
The answer to that depends on several factors, such as your credit score, terms, and interest.
Credit Requirements
In order to even qualify, you need to have a credit score of at least 660 and a minimum annual income of at least $25,000.
The company will also look at your recent credit activity, including credit inquiries.
Terms
If you’re approved, you will have the option of repaying your loan over the course of 36, 48, 60, 72, or 84 months – these are longer timeframes than most other lenders offer.
Interest
The interest you will be charged depends on several factors, including your credit and the length of the loan.
However, don’t forget that while paying the money back over a longer period of time will lower your monthly payments, it will also add up to more interest that you’ll end up paying in the long run.
Time to Funding
One thing to be aware of is that while Discover may come to a decision on your application the same day you apply, it may take a few business days before the funds are available.
So, if you need same-day access to funding, this probably isn’t the right option for you.
Discover’s Guarantee Policy
Discover also offers another unusual perk for a lender – a 30-day money-back guarantee that allows you to essentially test drive the loan before deciding if it’s the right choice for you.
This means if you take out a loan, but find better terms with another lender within 30 days of accepting the offer, you can return the money and pay no interest.
This can also be helpful if you receive the cash, then realize that the monthly payments will be more than you can afford.
The only exception is if you used the money to pay off a creditor directly, in which case the cash cannot be returned.
How to Apply for a Discover Personal Loan
Applying for a loan is fairly straightforward, if slightly more in-depth than the process with other lenders.
As one might expect, consumers can either apply online or by phone.
You will be asked how much you want to borrow, and the amount of time you want to repay the money.
To make sure you can afford the monthly payments, you might want to take advantage of Discover’s handy online loan calculator before applying.
That way you will know exactly what you can expect to pay per month – and make sure it fits within your budget.
Next, Discover will ask you for details about your employment and income, both of which they will need to verify.
You may be asked to submit bank statements and pay stubs, in which case you can upload the documents directly to your application.
You should be aware that Discover may contact your employer directly to confirm your salary.
If you are currently unemployed, you may still qualify if you can show that you have an annual household income of $25,000 and your credit report also reflects that you have shared financial obligations within your household.
If the loan is to pay off an existing debt, you will also need to be ready to provide both the balance due and the account number of your creditor.
Once you’ve completed the application you may be contacted by a loan specialist to verify some of the details.
When the process is complete, you can expect to receive a decision the same day you apply, which is another benefit to a Discover loan.
If you decide to accept the offer, you can expect to receive the money within one to three business days.
We hope this Discover personal loan review answered any questions you may have had about the company’s personal loans.
If you’re looking to get connected with a lender, simply fill out our form below to get started:
