PenFed Personal Loan Review
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Read more about how we rated PenFed.PenFed Credit Union is among the largest credit unions in the U.S. It offers competitive annual percentage rates (APRs) and flexible loan amounts and terms. However, you’ll need a good credit score to qualify for a personal loan.
- Membership required: While you don’t have to be a PenFed member when you apply for a personal loan, you will need to join if you decide to move forward in the process.
- No origination fees: While some lenders charge an origination fee, PenFed customers can avoid them. Origination fees are one-time administrative charges that lenders take out of your loan balance.
- Flexible loan amounts: Personal loan lenders typically have a minimum borrowing limit of at least $1,000 or $2,000, but PenFed allows you to borrow anywhere from $600 to $50,000.
- Fast funding: Borrowers can get their personal loan funds within one to two business days after they close on their loan agreement.
- Offers joint applications: If you want to qualify for lower rates or don’t have the best credit, PenFed allows joint personal loans. This means both of you will take responsibility for paying off the debt.
- Best for good- and excellent-credit borrowers: Those with strong credit profiles can reap the benefits of PenFed personal loans, including no origination fees, low interest rates and flexible features.
PenFed Credit Union pros and cons
Before moving forward with a PenFed Credit Union personal loan, be sure to carefully consider the following benefits and drawbacks.
| Pros | Cons |
|---|---|
No origination fees Offers funding within one to two business days APRs capped at 17.99% | No autopay discounts available Bad- to fair-credit borrowers may not qualify Loans are exclusive to members |
No origination fees can save borrowers as it’s one less charge to worry about. Funding is fast with this lender — just one to two business days with direct deposit —and because PenFed offers credit union personal loans, which are capped at 17.99% APR, you shouldn’t expect to pay a sky-high interest rate.
Unfortunately, if you don’t have a good credit score, it’s unlikely you’ll qualify for a PenFed personal loan and will need to instead consider bad credit loans. Plus, PenFed doesn’t offer autopay discounts. Loans are exclusive to those who join the credit union.
PenFed Credit Union requirements
PenFed doesn’t offer much insight as to its personal loan requirements; however, it does shed some light on its membership criteria.
| Minimum credit score | 700 |
| Required documents |
|
| PenFed membership | Must open a PenFed savings account with a minimum $5 deposit |
If PenFed Credit Union’s loan options won’t work for your borrowing needs, consider other personal loan lenders that may help you meet your financial goals and can offer you the best-fitting rates, terms and amounts.
How to get a loan with PenFed Credit Union
PenFed’s application is fairly straightforward, with the added step of becoming a member of the credit union. Here’s what you may come across during the process.
Prequalify for a loan
PenFed Credit Union allows you to check if you prequalify for a personal loan. This means you can check if you potentially qualify for a loan and see your potential rates, terms and amounts without any impact to your credit score.
At this stage of the process, it’s a good idea to check if you prequalify with multiple lenders and compare offerings.
Become a PenFed member
After shopping around, if you decide to proceed with a PenFed loan, you’ll need to become a member. Unlike some credit unions, PenFed has extremely flexible membership criteria: You’ll only need to provide your personal information and open a PenFed savings account with a $5 minimum deposit.
Verify your information
Like all trustworthy lenders, PenFed will require that you verify the information you provide when applying for a loan. Specifically, PenFed may want to confirm your income and identity to prevent fraud and make sure you can repay the loan.
PenFed may ask for recent pay stubs, bank or retirement statements and tax returns. You may also have to provide a copy of a government-issued ID, utility bill and/or your Social Security card.
Sign your loan agreement
During the final stages of your loan application, PenFed will run a hard credit pull, allowing the credit union to check your credit history. This can cause your credit score to drop, but only by a few points.
Finally, you’ll need to sign your personal loan agreement. Be sure to read the fine print so you understand all of the terms of your loan. Once you’ve closed on your loan, PenFed can deposit your funds within one to two business days.
If PenFed denies your application, it may be time to instead focus on improving your odds of getting approved for a loan. This can include taking steps to improve your credit scores and making sure that all of the information that shows up on your credit reports is accurate.
How PenFed Credit Union compares to other personal loan companies
Even if you believe PenFed offers what you’re looking for in a personal loan, it never hurts to shop around and compare other lenders. Here’s how PenFed stacks up against similar personal loan lenders.
| PenFed Credit Union | LightStream | SoFi | |
|---|---|---|---|
| LendingTree’s rating | 4.5/5 | 4.5/5 (Read review) | 4.5/5 (Read review) |
| Minimum credit score | 700 | Not specified | 680 |
| APRs | 7.99% to 17.99% | 7.49% to 25.49% (autopay discount included) | 8.99% to 25.81% (autopay discount included) |
| Loan amount | $600 to $50,000 | $5,000 to $100,000 | $5,000 to $100,000 |
| Repayment term | 12 to 60 months | 24 to 144 months | 24 to 84 months |
| Origination fee | None | No origination fee | 0.00% - 6.00% |
| Funding timeline | Receive funds within 1 to 2 business days | Receive same-day funding | Receive same-day funding |
| Bottom line | PenFed Credit Union offers lower rates, but you may find larger loans and longer terms elsewhere. | LightStream offers the longest loan terms, but you’ll have to meet their strict loan criteria to qualify. | SoFi has the most flexible credit requirements and an optional origination fee for lower rates. |
How we rated PenFed Credit Union
To come up with our star rating for personal loan companies, LendingTree considered 22 data points across three categories:
- Accessibility: We paid attention to whether lenders offered loans to nontraditional borrowers, as well as those without excellent credit scores. We also checked if lenders offered soft credit pulls, and whether they were transparent about eligibility criteria other than credit scores.
- Rates and terms: We wanted to know if lender rates, terms, amounts and fees were not only transparent, but also competitive.
- Repayment experience: We based this category on lenders’ reputations, customer support availability and unique benefits.
The data points reflect every step of the process to shop and apply for, borrow and repay personal loans. A five-star lender, for instance, has flexible eligibility requirements, offers you the chance to prequalify without commitment and supports you in zeroing your balance.
The 22 data points, culled from the lenders themselves, determine the overall rating. We score lenders consistently, sometimes awarding partial points, so that you can make apples-to-apples comparisons when shopping around.
LendingTree isn’t paid for conducting these reviews, and lenders don’t have control over their content. With our reviews and ratings, we aim to give our users the objective and exhaustive information they need to make the best possible decisions.
Frequently asked questions
If you need to get a loan with bad credit, you’ll have a hard time qualifying for a PenFed personal loan. However, if you have good credit, PenFed’s membership is open to you as long as you open a savings account with them.
PenFed requires that you have a credit score of at least 700 to qualify for a loan. If you don’t, you’ll need to improve your credit score before applying for a PenFed loan.
You can borrow between $600 to $50,000 from PenFed Credit Union. These loan limits may make it a good option for consumers looking for a small personal loan.
During the application process, PenFed may request proof of income in order to demonstrate that you can afford the loan. To verify your income, you can provide recent pay stubs, bank or retirement statements and tax returns.