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Taking care of your health is one of the most important things you can do, but sometimes that seems impossible with how the U.S. healthcare system is structured. In 2022, about one out of every four Americans skipped doctor-recommended medical care because of the cost. That can come back to haunt you if it leads to more expensive problems later, not to mention how it impacts your quality of life.
More people are turning to medical loans as a way to pay for necessary medical expenses. Take a few minutes to check your options for the best medical loans from our partner lenders, based on APRs, fees, and other loan features. If you find a good deal, that can reduce your stress later and help speed up your healing journey.
Best Medical Loans of 2023
| Company | APR | Credit Score est. | Loan Amount | More Details | |
|---|---|---|---|---|---|
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Best for No Fees : SoFi
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- APR Range: 8.99% - 25.81%
- Loan Amount: $5,000 - $100,000
- Loan Terms: 24 months - 84 months
Zero loan fees
Lots of benefits and perks
Lots of discounts available
Slower funding for medical loans
No co-signers allowed; only co-borrowers
Loan minimum is higher than most people need
SoFi is considered a premier lender because you’re not just taking out a loan when you’re approved; you get access to a full suite of “member benefits,” which includes everything from free one-on-one sessions with financial planners and career coaches to lounge access at Los Angeles-based SoFi Stadium. SoFi also offers more discounts than most lenders and charges no fees at all for its loans.
However, SoFi doesn’t allow co-signers on its loans, only co-borrowers; a subtle difference, but the latter is considered jointly responsible for the loan with you rather than serving as a backup payer. SoFi medical loans may take up to seven days to fund, slower than the same-day turnaround time it advertises for its regular personal loans. And since three out of four Americans with health care debt owe less than $5,000—the minimum for a SoFi medical loan—many people won’t find these loans very helpful.
- Available in all U.S. states and Washington, D.C.
- Must be employed or have a job offer starting within 90 days
- Must be at least 18 years old and a U.S. citizen, permanent resident, or non-permanent resident
Best Credit Union : PenFed Credit Union
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- APR Range: 7.74% - 17.99%
- Loan Amount: $600 - $50,000
- Loan Terms: 12 months - 60 months
Offers next-day funding
Member discounts for other services
Offers hardship assistance programs
No interest rate discounts
Must join credit union to be eligible (anyone can join)
No co-signers allowed; only co-borrowers
If you prefer working with community-focused credit unions instead of banks, PenFed is one of the best because it has an open-door policy. Anyone is eligible to apply for a loan as long as they’re willing to establish their membership by opening a savings account with $5, which PenFed even provides for you. PenFed is also very quick, with funding timelines of one to two days.
PenFed offers member discounts with several other businesses and services, including some you might find useful for healthcare such as dental benefits and hospital accident plans. Unfortunately, it does not offer any interest rate discounts.
- Recommended minimum credit score of 650
- Available in all U.S. states and Washington, D.C.
- Must open a savings account to join the credit union
Best for Bad Credit : Upgrade
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- APR Range: 8.49% - 35.99%
- Loan Amount: $1,000 - $50,000
- Loan Terms: 24 months - 84 months
Next-day funding times
Multiple discount options
Option to use your car for a secured loan
Potentially steep origination fees
No co-signers allowed; only co-borrowers
Not available to residents of Washington, D.C.
Getting a medical loan is tough if you’re among the many Americans with a bad credit score. Your options are more limited and the lenders you qualify with may charge very high rates. Upgrade is one of the best lenders if you’re in this scenario because it approves borrowers with credit scores as low as 560, according to customer support, and the maximum interest rate you’ll pay is less than the starting rate for many other bad-credit lenders. The origination fees are quite high, however, ranging from 1.85% to 9.99%.
Upgrade offers several different discounts, like up to 20% off if you use its Upgrade Rewards Checking account. You also have the option to use your car as collateral to get a secured loan. This can boost your odds of approval and may come with a lower rate.
Be careful if you do use your car as collateral. Like any secured loan, if you don’t pay up, the lender can repossess your car and that can cause a spiral of other problems for you. See how you fare with the best unsecured loans for bad credit first.
- Available in all U.S. states
- Maximum debt-to-income (DTI) ratio of 75%
- Recommended minimum credit score of 560
- Must have a valid U.S. bank account and email address
- No minimum income requirement, but will need to show proof you can repay the loan
- Must be at least 18 years old and a U.S. citizen, permanent resident, or non-permanent resident
Best for Small Loans : First Tech Federal Credit Union
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- APR Range: 8.99% - 18.00%
- Loan Amount: $500 - $50,000
- Loan Terms: 24 months - 84 months
Anyone can join
Allows you to use collateral or co-signers
Same-day funding and payment protection available
May charge late fees
No discounts available
Need to join credit union to receive the loan
First Tech FCU is a bit tougher to join than PenFed, but it’s still possible for anyone to do it. You’ll need to join either the Computer History Museum for $15 or the Financial Fitness Association for $8 to be eligible for membership, and then you’ll need to open a Membership Savings account at First Tech with a minimum of $5.
However, if you can jump that hurdle, First Tech makes an excellent choice for a medical loan. It offers loans in very small amounts, more typical of what many people actually need for medical expenses. You can increase your odds of approval and potentially lower your interest rate by using a co-signer, co-borrower, or even collateral for a secured loan. First Tech also offers optional payment protection programs for a nominal fee to erase some or all of your balance in certain cases, like if you lose your job.
- Recommended minimum credit score of 660
- Available in all U.S. states and Washington, D.C.
- Must open a savings account to join the credit union
Best for Quick Funding : Rocket Loans
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- APR Range: 9.12% - 29.99%
- Loan Amount: $2,000 - $45,000
- Loan Terms: 36 months - 60 months
Same-day funding
Good autopay discount
Can change payment due date
Relatively fee-heavy loan
Not available to residents of several states
Doesn’t allow co-signers or joint applicants
If you need money fast, Rocket Loans stands true to its name in that it can send you an ACH deposit as soon as the same day you’re approved. You’ll just need to complete the application and sign the loan promissory note before 1 p.m. ET. It also offers a relatively robust 0.30% discount if you sign up for autopay, higher than most other lenders which offer a smaller 0.25% discount.
Unfortunately, while Rocket Loans doesn’t charge exorbitantly high APRs, it does charge several fees: an origination fee of up to 8% (taken out of your loan proceeds) and a $15 fee for late or returned payments. In addition, you’ll need to be prepared to take out a solo loan because Rocket Loans doesn’t allow for co-signers or co-borrowers.
Even if Rocket Loans sends you an ACH transfer the same day, it can still take a few days for it to show up in your account depending on your bank’s ACH transfer policies.
- Must have a valid online bank account
- Must be at least 18 years old and a U.S. resident
- Must earn an annual income of at least $24,000
- Available in all U.S. states and territories except for Iowa, Nevada, Washington, D.C., and West Virginia
Best for Low Interest Rates : Upstart
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- APR Range: 6.70% - 35.99%
- Loan Amount: $1,000 - $50,000
- Loan Terms: 36 months - 60 months
Next-day funding
Available to borrowers with bad credit
Uses non-traditional factors to make a loan decision
No discounts and potentially high fees
Can’t change payment due date
Can’t apply with another person or use collateral
Upstart is currently charging some of the lowest starting rates in the personal loan business, making it a great choice if you have excellent credit. But it’s still a particularly good choice even if you have credit challenges, because it has no strict credit requirements aside from having at least something on your credit file (even if it’s not enough to generate a credit score yet). And since Upstart uses its own proprietary credit scoring model which includes factors other lenders overlook, like your education, it can often offer lower rates.
That’s especially good news because you can’t use other common methods to overcome bad credit challenges with Upstart, like putting down collateral for a secured loan or having a creditworthy co-signer. And Upstart may charge an origination fee as high as 10% of the loan amount, although this is typical for loans given to bad-credit borrowers.
- Recommended minimum credit score of 300
- Must have a valid email address and bank account
- Must be earning an annual income of at least $12,000
- Must be employed or have a job offer starting within six months
- Must be at least 18 years old and a U.S. citizen or permanent resident
- Available in Washington, D.C., and all U.S. states except Iowa and West Virginia
Compare the Best Medical Loans of 2023
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Final Verdict
SoFi is one of the best medical loan companies, but be mindful of its $5,000 minimum loan amount, which is higher than most people will need to borrow. Keep in mind you can use the extra funds for other things too, if necessary, such as paying off higher-interest debt or catching up with overdue repairs for your car or home. Alternatively, you could just pay back the funds you don’t need since there are no prepayment penalties.
If you prefer working with credit unions, PenFed and First Tech Federal Credit Union are good choices because anyone can join if they jump through the right hoops, and the smaller loan amounts may be closer to what you need for medical loans anyway. If you have credit challenges, Upstart and Upgrade allow you the best shot at getting a relatively reasonable interest rate without being automatically denied because of your credit score—and if you have great credit, Upstart offers the lowest rates around.
Guide to Choosing the Best Medical Loans
Should You Apply for a Medical Loan?
The truth is that one out of every five adults has medical debt they don’t think they’ll ever be able to pay off. That’s why it’s important to consider whether a medical loan is really the right choice if you can’t afford to pay a medical bill outright.
Taking out a medical loan might be a good choice if:
- You’re looking to build credit
- You’re paying for care that’s necessary for your health
- You’ve exhausted all of your alternatives (more on that below)
- You’ve estimated your monthly payments and checked they’ll fit in your budget
On the other hand, you may want to avoid taking out a medical loan if:
- You haven’t explored other options first
- You’re only paying for cosmetic treatments
- You haven’t checked that the payments will fit in your budget
Factors to Consider When Comparing Medical Loans
If you decide a medical loan is the right choice, there are a few things you can do to smooth your repayment journey later. One of the biggest is checking your rate and loan options with at least three lenders, although more is better.
Here are some factors you can use to compare the best medical loans:
- Annual percentage rate (APR): This gives you the total cost of the loan with all expenses included: the interest rate, plus fees.
- Term length: Longer-term loans shrink your payments down, but long terms mean you’ll be in debt for a longer time and pay more interest too.
- Funding speed: You can get your money as soon as the same day with some lenders, while others may take several days or more.
- Lender reputation: Reading reviews from actual customers and ratings from independent organizations like J.D. Power can give you a sense of how fairly the lender will treat you.
- Repayment options: Ask what assistance programs the lender has if you run into problems going forward, such as being laid off or becoming disabled. For example, some lenders may reduce your interest rate or allow you to pause your payments for a period of time.
Alternatives to Medical Loans
Taking out a medical loan should never be your first go-to when you get a bill in the mail. In some cases, you can lower or even zero out your bill without ever having to pay a cent. Here are some options to consider first:
- Charity care: Hospitals generally have need-based financial assistance programs available and you can reach out to the billing department for an application.
- Check your bill for errors: Over 50% of adults with healthcare debt have received a medical bill containing errors, and these are adequately fixed in about half of billing disputes. If you need help, medical billing advocates can do the work for you based on an hourly fee or percentage of the money they save you.
- Price shop before your procedure: Call around or use a service like Healthcare Bluebook to find the cheapest provider for expensive procedures like knee replacements and sleep studies. If you have insurance, make sure the provider accepts it first.
- Negotiate your bill: The billing department with most healthcare providers may be willing to offer discounts or be open to negotiating lower rates or even interest-free payment plans. It doesn’t hurt to ask.
- Community support: See if there are any groups in your area offering financial assistance in paying medical bills. To get help from a live person, try calling 211 or visiting 211.org.
- Crowdfund your bill: If you’re facing a truly horrendous bill and can generate a lot of support on social media, you may be able to pay for some or all of your bill using sites like GoFundMe.
- Borrow from friends or family: Try offering to write a formal contract, and only use this option if you’re sure you can repay the funds.
- Use a 0% APR credit card: If you can pay off the debt in a short amount of time, you might be a good candidate for a 0% APR credit card. Be careful of deferred-interest credit cards like CareCredit, however, which will back-charge you for all of the missed interest if you don’t pay it off within the specified amount of time.
Frequently Asked Questions
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What Is a Medical Loan?
A medical loan isn’t an official term like with student loans or mortgages. Rather, most people use the term to refer to any type of debt they use for medical expenses. Personal loans are probably the most common type of medical loans, but people can use other types of debt too, like credit cards or home equity loans.
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What Are the Pros and Cons of Medical Loans?
Medical loans can sometimes mean the difference between being able to afford medical care or not. They can also help you build credit if you make all of your payments on time. However, they can make it tougher to make ends meet if your monthly payments become unaffordable. If you miss any payments, your credit score will drop, and you could be sued if you default on the loan.
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Can You Get Medical Loans for Bad Credit?
Yes, you can get medical loans for bad credit. Your chances of getting an affordable loan are better if you have good credit, but it’s possible to find lenders willing to offer bad credit loans for medical bills too. Some lenders, like OneMain Financial, offer personal loans with no minimum credit score requirement, although you will need to meet other conditions for approval.
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What Is the Best Way to Pay for Medical Expenses?
It’s always good to review your bill and make sure it’s accurate, because 53% of Americans with medical debt have received a medical bill containing an error. You can also try negotiating your bill lower or asking for an interest-free payment plan or need-based assistance, which many healthcare providers offer. After that, the best way to pay for medical expenses is by using your savings (if you have any) or by taking out a medical personal loan.
Methodology
Investopedia is dedicated to providing consumers with unbiased, comprehensive reviews of personal loan lenders. To rate providers, we collected hundreds of data points across more than 40 lenders, including interest rates, fees, loan amounts, and repayment terms, to ensure that our reviews help users make informed decisions for their borrowing needs.
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