App version: 0.1.0

Guide to Personal Loan Apps

What Is a Personal Loan App and Is It Worth It?
Austin Kilham
Austin KilhamUpdated March 27, 2023
Share this article:
Editor’s note: Lantern by SoFi seeks to provide content that is objective, independent and accurate. Writers are separate from our business operation and do not receive direct compensation from advertisers or partners. Read more about our Editorial Guidelines and How We Make Money.
Personal loans allow you to borrow money for a variety of purposes, including for home renovations and debt consolidation. And many personal loan lenders now offer a personal loan app to help you conveniently choose and apply for a personal loan right from your mobile device. Read on to learn how personal loan apps work, the pros and cons, and tips on choosing an app that’s safe to use.

What Is a Personal Loan App?

A personal loan mobile app lets you apply for a personal loan on your mobile device. If you’re approved for a loan, you can then typically manage your payments through the personal loan app.  Personal loans are usually offered through banks, credit unions, online lenders, and private personal loan lenders. Some of these lenders and institutions may have personal loan apps for Android and iOS phones and devices. You can start with your bank or credit union to see if they have a mobile app you can use for a personal loan. Some online lenders even have apps specifically designed for personal loans.Recommended: 10 Possible Benefits of Obtaining Personal Loans

How Does a Personal Loan App Work?

To use a personal loan app, you’ll need to download the app from the App Store or Google Pay store. Then you’ll create an account. The features offered by different personal loan apps may vary by lender. Generally, you can use these apps to review personal loan options, apply for a personal loan, view your account, check your balance, and make payments once you’re approved for a loan. However, some lenders may require you to complete portions of the application process on their website.Applying through a lender’s personal loan mobile app will typically be similar to an online or in-person loan application process. You’ll need to provide information, such as your name, address, phone number, Social Security number, and employment and income. The difference is that using a personal loan app may be one way to get paperless loans, which could be quick and convenient for borrowers. When you apply, in order to get approved for a personal loan, your lender will look at your credit score to determine your creditworthiness. Borrowers with good credit scores tend to get offered loans with lower interest rates since they have a history of responsibly managing their debt and making payments on time.  If your loan application is accepted and you agree to the terms and conditions of the loan, the lender will deposit the loan amount into your bank account, typically within a couple of business days. You may even be able to check your loan application status on the app to see where the process stands.

Are Personal Loan Apps Safe to Use?

In general, applying for a personal loan from a bank, credit union, or online lender through a personal loan mobile app is safe as long you take precautions. Only download a personal loan app from a lender you know and trust. If you see an app from a lender you don’t recognize, do some research to make sure they are reputable. Check to see if there have been any complaints filed against them with the Federal Trade Commission (FTC) or the Consumer Financial Protection Bureau. Also, log onto the Better Business Bureau’s website to check the lender’s rating. If you have any doubts, trust your gut and look for another app.Before downloading a personal loan app, read all the pertinent information about how your private information will be accessed, what information the app will have access to, and how it will be kept secure. Often the data is encrypted to protect you. Look for information about that.When you download the app, make sure to keep it updated, along with your phone, so that you’re using the latest security upgrades. And only use the app on a secure WiFi connection to help keep your private information protected. Never use the app on a public connection. Recommended: How Much Can You Borrow With a Personal Loan?

Finding the Right Personal Loan App

If you’d like to use an app for a personal loan, you’ll want to choose the best one for you. Here are some tips that could help.

Things to Consider

Read many reviews of different personal loan apps to see which ones rate highly. Looking at reviews may give you a good sense of what the app offers, how easy it is to use, and the best personal loan rates and terms you might be able to get.As mentioned earlier, make sure the app has good security to protect your information. Read the fine print about how your data is accessed and stored.Check with the Better Business Bureau and the FTC or Consumer Financial Protection Bureau, especially if the app is from a lender you’re unfamiliar with, to see how they rate and if there are complaints against them.

Pros and Cons of Personal Loan Apps

Before you download a personal loan app, it’s wise to weigh the advantages and disadvantages to decide if using a personal loan mobile app is right for you

Personal Loan App Pros

  • Personal loan apps can be a convenient way to apply for a personal loan right from your phone. There’s no need to go to a bank and no reams of paperwork to sign.
  • Filling out a loan application through a mobile app may be faster than applying in person at a bank or credit union. That means you can potentially receive your funds sooner. 
  • You can use the app to make payments and keep track of what you owe. There’s no need to turn on your computer or mail a payment. 

Personal Loan App Cons

  • Not all personal loan apps allow you to complete the loan application process and manage the loan from your phone. You may be required to do some of these things online from your computer. 
  • Using a personal loan app doesn’t guarantee you’ll get the best interest rates. Be sure to search for rates and terms from other lenders as well and compare them.  
  • Finally, there are personal loan scams out there. Make sure that the app you’re using, and the loan you’re applying for, are legitimate.

Alternative Ways to Apply for Loans

If you decide that a personal loan app isn’t for you, you can apply for a personal loan online through your bank, credit union, or an online lender’s website. You can also apply for a personal loan in person at banks and credit unions. Choose the method you’re most comfortable with. 

The Takeaway

Personal loan apps can be a convenient way to apply for and manage a personal loan. Always consider your options carefully before you download an app, check ratings and reviews, and be sure you’re choosing a reputable lender. And to get the best terms and rates, shop around with different lenders.As you’re exploring personal loan options, Lantern can help simplify the process. All you need to do is fill out one quick form, and you’ll get offers from multiple lenders in our network. That makes it quick and easy to compare the options to find the best one for your needs.

Frequently Asked Questions

What is a personal loan app?
How do personal loan apps work?
Are personal loan apps legitimate?
Photo credit: iStock/nensuria

About the Author

Austin Kilham

Austin Kilham

Austin Kilham is a writer and journalist based in Los Angeles. He focuses on personal finance, retirement, business, and health care with an eye toward helping others understand complex topics.
Share this article: