Discover Personal Loans Review

Pros Explained

• No origination fees: While some lenders charge origination fees, Discover doesn’t charge anything to process your loan. 
• Direct payment to creditors for debt consolidation: If you’re borrowing to consolidate debt, Discover simplifies the process by sending the loan funds directly to your creditors. 
• Fast funding times: If you’ve fulfilled all the application requirements, you could receive the money in as little as one business day. 
• Flexible repayment terms: With a Discover personal loan, you can select loan terms as short as three years or as long as seven years. 
• Option to pre-qualify online or over the phone: Discover makes it easy to check your rates through pre-qualification, a simple process that won’t ding your credit or show up as a negative item on your credit report. 

Cons Explained

• No opportunities for interest rate discounts: While some lenders offer a rate cut to pre-existing customers or borrowers who opt into automatic payments, Discover doesn’t offer rate discounts. 
• Borrowing limit maxes out at $35,000: Some other lenders offer personal loans up to $100,000, but Discover sets a relatively low borrowing limit. 
• No option to add collateral or co-signer to loan: Discover personal loans are unsecured, so you alone will have to meet underwriting requirements for credit and income to qualify. There’s no option to add a co-signer or apply for a joint personal loan. 
• May charge a fee for late payments: Discover may charge a fee of $39 if you don’t make your loan payments on time. 

Types of Personal Loans Offered by Discover

Discover offers unsecured personal loans, meaning these loans don’t require you to apply with collateral. Instead, Discover reviews your credit, income, debt-to-income ratio, and other factors when evaluating your loan application. Borrowers with the strongest credit will get the best rates, while weak-credit borrowers will get worse rates or not qualify. 

You can use a Discover personal loan for almost any legal purpose, including: 

• Debt consolidation
• Home improvement
• Medical expenses
• Wedding costs 
• Vacation funds
• Auto expenses
• Small business costs 
• Veterinary bills 
• Financial emergencies 

Time to Receive Funds

Discover can approve your loan the same day you apply as long as your application is not missing any information. If you apply on a weekend, you may have to wait until the next business day to receive a decision.

Once your application is approved, Discover can disburse the funds as soon as the next business day via ACH transfer. If you request to receive your funds via check, the process will take a little longer. 

To avoid delays and ensure your loan is processed quickly, make sure to follow all the application instructions, review the forms for typos, and double-check that your bank account numbers are accurate. 

Borrower Requirements

Discover reviews your credit, income, debt-to-income ratio, and other factors when evaluating you for a personal loan. While it doesn’t disclose its minimum credit score requirement, Discover does have a minimum annual income requirement of $25,000. You’ll also need to be a U.S. citizen or permanent resident at least 18 years of age to get a Discover personal loan.

Discover Personal Loan Features

• Debt consolidation assistance: Discover makes it easy to consolidate debt by sending your personal loan funds directly to your creditors. After your debts are paid off, you’ll start paying back your new personal loan, hopefully at a lower interest rate than you had before. 
• 30-day loan guarantee: If you change your mind about your loan, Discover allows you to return the full amount within 30 days with no interest charges or penalties. 
• Mobile app: You can manage your personal loan payments directly from Discover’s mobile app.
• Option to apply online or over the phone: Discover lets you pre-qualify and apply for a personal loan on its website or over the phone with one of its loan specialists. 

Co-Signers and Co-Applicants

Discover does not permit co-signers or co-applicants on its personal loans. You’ll need to meet the lender’s underwriting requirements for credit and income on your own to qualify for a personal loan. 

Can You Refinance a Personal Loan With Discover?

Discover allows you to refinance an unsecured personal loan you already hold from Discover or another lender, which may be appealing if rates have dropped or your credit score improved since you initially took out the loan. Lowering your interest rate can save you money over the life of your loan. You’ll also have the chance to choose new repayment terms. 

Customer Service

You can contact Discover’s loan specialist team via phone Monday to Friday, 8 a.m. to 11 p.m. Eastern Time, and Saturday to Sunday, 9 a.m. to 6 p.m. ET. 

For information on applying for a loan, call (866) 248-1255, or (866) 710-3357 for people with hearing impairments. 

If you’ve already borrowed and need to speak with someone about paying back your loan, call (877) 256-2632, or (866) 710-3357 for people with hearing impairments.

Customer Satisfaction

Discover ranks highly in J.D. Power’s 2022 U.S. Consumer Lending Satisfaction Study, coming in at number five on its overall customer satisfaction index ranking. This survey measures customer satisfaction around the loan application, management, shopping, and terms, and is based on responses from 5,269 personal loan customers.

Discover doesn’t fare as well on Trustpilot, though, receiving only 1.7 stars out of 5 based on almost 200 rankings. Some consumers complain about poor customer service and long wait times. It’s worth noting, however, that these reviews are not limited to personal loans, but instead may refer to any of Discover’s financial products. 

Applying for a Discover Personal Loan 

You can apply for a Discover personal loan on its website or with one of its loan specialists over the phone. Kick off the process by pre-qualifying for a loan, which only takes a few minutes. 

If you see an offer you like, you can submit a full application. At this point, Discover will run a hard credit inquiry, which could decrease your score by a few points and will appear on your credit reports. 

The application will ask for your personal details and loan amount. You’ll also upload some verifying documents to Discover’s secure loan portal. Here’s some information you’ll need to have on hand: 

• Household income
• Employment history 
• Bank account number and routing number for direct deposit of the loan funds 
• Creditor information, such as loan balances and account numbers, if you’re borrowing a loan to consolidate debt 

If you received an invitation to apply for a Discover personal loan in the mail, you’ll also enter your personal invitation ID number. As mentioned, Discover may be able to give you an approval decision the same day you apply, as long as you provide all the required information. 

Alternative Personal Loan Lenders

Final Verdict

Discover offers flexible personal loans with competitive rates, multiple repayment terms, and zero origination fees in all 50 states. Rated as one of the best personal loan providers for customer satisfaction by J.D. Power, Discover could be an excellent option for borrowing money. 

Discover may have some drawbacks for certain borrowers, though. You can’t apply with a co-signer, for instance, and personal loan limits max out at $35,000. If these rules don’t match what you’re looking for, an alternative personal loan lender could be a better fit. 

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.