A personal loan from OneMain Financial may be worth considering if you need to borrow money but a poor credit score is keeping you from qualifying with other lenders. The community-based lender, which has been in business for more than 100 years, offers personal loans up to $20,000. However, before you apply you should be aware that the cost of a personal loan from OneMain Financial can be on the steep side. Annual percentage rates (APRs) range from 18% to 35.99%, and you may face an origination fee as high as 10%. 

Our OneMain Financial review covers the details you need to determine whether a personal loan from this lender is a good fit for your situation.

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Pros

  • Good credit not required to qualify

  • Numerous branches

  • Find out if you prequalify with a soft credit pull

Cons

  • High starting APR compared with some subprime lenders

  • Maximum loan amount of $20,000

  • May charge high origination fees and late fees in addition to other costs

Pros Explained

  • Good credit not required to qualify: OneMain doesn't disclose minimum credit requirements on its website. However, numerous reports indicate that OneMain is willing to work with credit-challenged borrowers.
  • Numerous branches: OneMain Financial has more than 1,500 physical branches in 44 states. 
  • Find out if you prequalify with a soft credit pull: Soft credit inquiries do not hurt your credit score. Because OneMain Financial allows you to check for prequalified offers with just a soft credit pull, it’s easier to rate shop and compare deals among several lenders. 

Cons Explained

  • High starting APR compared with some other subprime lenders: It’s not unusual for lenders to charge higher APRs for borrowers with fair or poor credit. However, OneMain Financial’s starting APR of 18% is higher than some subprime lenders charge. 
  • Maximum loan amount of $20,000: If you need to borrow a larger sum, the lender may not be a good fit for you. 
  • May charge high origination fees and late fees in addition to other costs: OneMain Financial charges late fees up to $30 or 15% of your delinquent payment. The lender also charges up to 10% in origination fees— more than most other subprime lenders charge. 

COVID-19 Assistance

Borrowers who cannot afford to keep up with their payments due to COVID-19 can call a branch during business hours to discuss potential solutions. 

Types of Personal Loans Offered By OneMain Financial

OneMain Financial issues personal loans to borrowers for a number of different purposes. While you cannot apply your loan proceeds toward post-secondary education or business expenses, you can use the money you borrow for any of the following reasons (and perhaps more): 

  • Debt consolidation
  • Home improvement
  • Life events (e.g., weddings, medical expenses, emergency loans, etc.)
  • Recreational loans 

Additionally, the lender also offers auto loans for purchases, refinances, and repairs. 

Loan Amounts

OneMain Financial offers personal loans ranging from $1,500 to $20,000. Depending on the state where you reside, your minimum or maximum available loan amount may be different. The lender points out that not all borrowers will qualify for larger loan amounts. Additionally, for large loan amounts OneMain may require collateral in the form of a first lien on a motor vehicle in your name that is 10 years old or newer and has valid insurance coverage. 

APR

Fixed-rate loans from OneMain Financial feature an APR range of 18% to 35.99%. The lender does not offer variable rate loans to borrowers. However, OneMain does offer both unsecured and secured loan options. If you borrow money without securing your loan with a vehicle, your APR will likely be higher than it would be otherwise. 

Loan Terms

Repayment terms come in four options—24, 36, 48, or 60 months. 

Credit Score Requirements

OneMain Financial does not disclose its minimum credit score requirements on its website. Instead, the lender states that you have to meet its credit standards to qualify for financing, including:

Yet despite the lack of transparency online where qualification requirements are concerned, there are numerous reports that the lender is willing to work with credit-challenged borrowers

Fees

When it comes to fees, OneMain Financial charges high amounts compared to many other lenders. If you take out a personal loan with this lender, you should factor in the following potential costs:

  • Origination Fees: The lender charges origination fees ranging from 1% to 10% or flat fees between $25 to $400. Your actual fee will depend on factors such as your state of residence. 
  • Late Payment Fees: If you make a payment after the grace period allowed by the laws of your state, the lender may charge you up to 15% of your delinquent balance or a flat fee between $5 to $30. Actual late fees vary depending on your state of residence.
  • Non-Sufficient Funds Fees: In certain states, you may face a fee of $10 to $50 when your payment is returned as a result of insufficient funds in your account. 
  • Government Fees: If you take out a secured loan and your state law allows it, OneMain may charge you a fee for placing a lien on your vehicle’s title. These fees are initially charged by the state or county to the lender and, where allowable, OneMain will pass the fee along to you at cost. 

On a positive note, the lender does not charge prepayment penalties. You can pay off your loan early, if you wish to do so, without incurring any extra costs. 

Time to Receive Funds

Once you’re approved for a personal loan, you could potentially pick up your funds by check as soon as the same day. If you opt to receive your funds by Automated Clearing House (ACH) instead, you may need to wait an extra one to two business days, based on the time of your loan closing. 

OneMain Financial Personal Loan Features

Some of the appealing features of OneMain's personal loans include soft initial credit inquiry, joint applications, free VantageScore credit score, and rewards. Here is how each works:

Soft Initial Credit Inquiry

You can check to see if you are prequalified for a personal loan with OneMain Financial online. The initial credit inquiry when you check for prequalified offers will be soft. A soft credit inquiry means that your credit score will not impacted negatively in any way. However, if you move forward and officially apply for financing, a full hard credit inquiry—which can impact your credit score—will take place at that time. 

Joint Applications Available

For borrowers who want to add a cosigner, OneMain Financial does allow joint personal loan applications. The lender reveals that you may be able to qualify for a larger loan amount when you apply with a co-borrower. Before you cosign for a loan (or have someone cosign on your behalf), it’s important to understand that doing so can be risky. If the primary borrower fails to pay the loan back as agreed, both applicants will be equally liable for the debt. Additionally, both the borrower and co-borrower may experience credit score damage that could make it difficult to qualify for future financing. 

Free VantageScore Credit Score

OneMain customers can log in to their accounts to receive a free copy of their VantageScore credit score once a quarter. The benefit is limited to primary borrowers, not cosigners.

OneMain Rewards

With OneMain Rewards, borrowers can earn rewards in a variety of ways, including when you:

  • Sign up for direct pay
  • Opt for paperless statements
  • Make your payments on time each month
  • Connect to Facebook

Once you have enough points, you can redeem them for benefits like movie tickets, dining, Amazon gift cards, and more. 

Apply for a OneMain Financial Personal Loan 

Here’s a look at what to expect when you apply for a personal loan with OneMain Financial: 

  1. Discover if you prequalify: Fill out some basic information online about yourself and your financial situation.
  2. Tell OneMain how much you want to borrow: Depending on where you live, you may be able to select your desired loan amounts between $1,500 and $20,000. 
  3. Find out if you prequalify: You will receive a quick decision online to let you know whether you’re able to proceed with an official loan application at this time.
  4. Meet with your loan specialist: OneMain will require you to visit a branch to complete your loan application. You will need to verify your identity, income, employment, expenses, and (if applicable) your collateral at this appointment. 
  5. Discuss your loan options: Your loan specialist will be able to review your loan options, terms, APR, and more so you can decide if you wish to accept the loan offer. 
  6. Sign your loan agreement: Once you review your loan terms and conditions, you can sign your loan agreement if you are satisfied and wish to move forward. 
  7. Receive your funds: You may receive a check as soon as the same business day you apply. If you prefer to receive your loan proceeds via ACH transfer, it may take one or two additional business days to receive your funds. 

Can You Refinance a Personal Loan with OneMain Financial?

OneMain Financial has published a number of educational articles about the potential value of refinancing loans, including personal loans. However, the lender isn’t clear about whether it will allow you to refinance an existing OneMain loan or lower your monthly payment. Instead, customers are asked to contact their local branches for more information about whether or not they may qualify for lower payments. 

Verdict

Borrowers with good credit, and especially those with excellent credit, may be able to qualify for a more attractive personal loan elsewhere. However, if you have credit problems and you haven’t been able to prequalify for a personal loan elsewhere, OneMain Financial may be worth considering. 

Keep in mind that you should still shop around for the best personal loans for bad credit before you agree to any financing offer. Comparing rates and terms between multiple lenders could potentially save you a significant amount of money over the life of your loan. 

Methodology

Investopedia is dedicated to providing consumers with unbiased, comprehensive reviews of personal loan lenders. We collected over 25 data points across more than 50 lenders including interest rates, fees, loan amounts, and repayment terms to ensure that our content helps users make the right borrowing decision for their needs.