Discover at a Glance
- Discover offers personal loans from $2,500 to $40,000 with terms of three to seven years.
- Discover is a well-known institution established in 1960 with an A+ Better Business Bureau (BBB) rating.
- Discover offers personal loans with rates ranging from 7.99% to 24.99%, which are among the lowest of many competitors.
FEATURED PARTNER
Best for Low Rates
4.1
Best for Low Rates
4.1
Fast Facts
- Minimum credit score: Not disclosed
- Loan amounts: $2,500 to $40,000
- Loan terms: 3 to 7 years
- Rates: Starting at 7.99%
Pros & Cons
Pros
- Funds deposited in your account as soon as the next business day
- Flexible repayment terms
- Pay off creditors directly
Cons
- $39 late fee
- Low maximum loan amount
- No joint loans allowed
Usage Rules
You can use a Discover personal loan for the following:
- Vacations
- Home improvements
- Auto repairs
- Moving expenses
- Medical bills
- Taxes
- Emergencies
Our Take on Discover Personal Loans
Discover personal loan rates are typically among the lowest of its competitors. We also like that it doesn’t charge origination fees and has a broad range of repayment terms. But you’ll need to look elsewhere if you need a co-signer or co-borrower, as Discover doesn’t have that option.
- Minimum Credit Score: Not disclosed
- Loan Amount: $2,500 – $40,000
- Loan Term: 3 to 7 years
Insider News
We reached out to Discover’s head of product strategy, Rachael Olson, for insider knowledge on Discover loans. Olsen pointed out several features, such as Discover’s 100% U.S.-based customer service, a free Credit Scorecard with an updated FICO Score every month and a loan repayment program.
Olsen also offered this tip for borrowers who may be experiencing financial hardship.
Rachel Olsen
Discover’s Head of Product Strategy
“Discover is here to help our personal loan customers who may be experiencing a temporary financial setback or long-term hardship. Visit our Loan repayment programs webpage or call (877) 256-2660 to learn more about payment options.”
How We Rate Discover Personal Loans
Flip Card Discover
Discover Rating 4.1 / out of 5 stars
Rating breakdown
Affordability How expensive each company’s loans are to pay back. 5 / 5
Loan Features The breadth of loan terms and features available to prospective customers. 3 / 5
Customer Experience Ease of application, prequalification and customer service interactions. 4 / 5
Company Reputation An exploration of lenders’ BBB files, customer reviews and outstanding regulatory actions. 5.0 / 5
Our team put together a comprehensive 100-point rating system to evaluate personal loan companies. We gathered data points from 28 of the most prominent lenders in the US and analyzed disclosures, licensing documents, sample loan agreements, marketing materials and websites. Our rating system takes into account four broad categories.
- Affordability (35%): How expensive each company’s loans are to pay back.
- Loan features (35%): The breadth of loan terms and features available to prospective customers.
- Customer experience (20%): Ease of application, prequalification and customer service interactions.
- Company reputation (10%): An exploration of lenders’ Better Business Bureau files, customer reviews and outstanding regulatory actions.
Discover ranked high in several categories like APR, funding speed, customer experience, no origination fees and available repayment terms. However, it scored low in other areas, including maximum loan amount and minimum credit score.
Our top-rated lenders may not be the best fit for all borrowers. To learn more, read our full personal loans methodology.
| Rating Dimension | Dimension Score |
|---|---|
| Affordability | 35/35 |
| Loan Features | 21/35 |
| Customer Experience | 16/20 |
| Company Reputation | 10/10 |
| Overall Score | 82/100 |
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Will I Qualify for a Discover Personal Loan?
When you apply for a Discover loan, the lender considers many factors, including your credit history, credit score, income and debt-to-income ratio (DTI).
Credit Score and Financial History
Discover doesn’t disclose its minimum credit score requirement, so we called to get the low-down. The representative we spoke to said that the Discover underwriters don’t use a specific credit score; instead, they look at each applicant’s total financial picture to make a decision.
However, we dug a little deeper and took a look at Discover’s most recent 10-K report and found that most of the applicants approved in 2023 had credit scores of 660 or higher.
Income and Employment
Discover’s minimum income requirement is $25,000, and the company doesn’t list any specific employment criteria on its website.
Citizenship and Residency
Discover personal loans are available in all 50 states as well as Washington, D.C.:
Helpful Tip
Most of Discover’s borrowers have good to excellent credit scores of 660 or higher. If you have poor credit, you may receive a more favorable rate by applying with Upstart. However, if you’re set on using Discover and don’t need funds immediately, it may make sense to improve your credit first.
Discover Personal Loans Reviews
To give you the most comprehensive view of customers’ experiences with personal loan lenders, we compiled thousands of reviews from multiple sites, including Trustpilot, the Better Business Bureau (BBB), Consumer Affairs and BestCompany.
We then analyzed each review to determine whether it was positive or negative, categorized it and normalized all scores against one another to assign it a numerical value and create a fair standard.
In all categories, a score of 3.5 stars is average.
| Overall Consumer Sentiment: | 3.1 |
| Ease of Use: | 3.6 |
| Responsiveness: | 3.5 |
| Transparency: | 3.2 |
| Trust and Reliability: | 3.4 |
| Customer Service: | 3.1 |
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Most Praised Features
Discover scored above the industry average for its ease of use. As a strictly online bank, Discover can hone in on what its customers need and develop its technology accordingly.
User Interface and Accessibility: Customers appreciate the ease of using Discover’s online and mobile services. More than 38% of positive reviews mentioned its user experience.
Most Common Complaints
Discover’s customers complained about poor customer service and a lack of transparency. However, it’s important to note that customer reviews are not just about Discover’s personal loans, but include its credit cards, student loans, home equity loans and other financial products.
- Customer service: Particularly in handling disputes and technical issues, customer service was frequently criticized. About 36% of negative reviews mentioned poor customer service.
- Transparency and communication: Customers expressed frustration with unexpected fees and unclear terms. More than 26% of complaints described issues with transparency.
Who Are Discover Personal Loans Best For?
Discover loans might be a good option for borrowers seeking small- to medium-sized loans since loan amounts range from $2,500 to $40,000. It may also be an excellent choice if you need to consolidate debt, as Discover can send funds directly to your creditors.
On the other hand, Discover is not the best choice for consumers who want to apply for a loan with a co-borrower or co-signer. Also, it’s not the best option if you have bad credit since most approved applicants have FICO scores of at least 660.
Case Studies
Consider the following personas and situations to help you decide if a Discover personal loan is right for you.
Emily needs to consolidate her student loans and credit card debt
She has been a high school teacher for three years and has a credit score of 710. She would like to simplify her finances by combining her student loans and credit card payments into a single monthly payment. A personal loan from Discover could help Emily streamline her finances and save on interest over time.
Mike, a small business owner, wants to renovate his building
Mike has been in the retail business for five years. With a solid credit score of 680, he plans to update his store’s interior to appeal to more customers. A Discover personal loan could give him the funds he needs to renovate his store without all the red tape of a business loan.
Karen needs to cover unexpected medical expenses
Karen, a long-time freelancer with a credit score of 720 and inadequate health insurance, recently faced a medical emergency that left her with significant expenses and lost wages. She’d rather manage these costs without dipping into her savings. Discover’s personal loan terms and quick approval process might make it a good choice for Karen to handle her medical bills and keep her savings intact.
How Discover Compares to Other Lenders
Discover offers competitive rates that are often slightly higher than some top lenders like SoFi, PenFed and LightStream — which are known for their low rates for well-qualified borrowers. However, Discover might be more accessible to borrowers with more lenient credit requirements. While none of the lenders we compared Discover to disclose their credit requirements, LightStream states that you need good or excellent credit (usually 670 or above) to qualify.
| LightStream | SoFi | PenFed | Discover | |
| Loan Amount | $5,000 – $100,000 | $5,000 – $100,000 | $600 – $50,000 | $2,500 – $40,000 |
| Minimum Credit Score | Not disclosed | Not disclosed | Not disclosed | Not disclosed |
| Loan Terms | 2 – 20 years | 2 – 7 years | 1 – 5 years | 3 – 7 years |
| Rates | 6.99% – 25.99% | 8.99% – 29.49% | 8.99% – 17.99% | 7.99% – 24.99% |
| Fees | X | X | Late fee of $29 | Late fee of $39 |
| Funding Speed | Same day | Same day | Next day | Next day |
| Prequalify | X | ✓ | ✓ | ✓ |
Pros and Cons of Discover Personal Loans
Discover loans offer quick funding and flexible loan terms, but there’s no option to apply with a co-applicant. Consider its other potential benefits and drawbacks.
Pros
Pay off creditors directly: If you’re taking out a loan for debt consolidation, Discover can streamline the process by sending funds directly to your creditors
Quick funding: Once approved, funds can be deposited into your bank account the next business day
Flexible repayment terms: You can choose loan terms from three to seven years
Cons
Late fees: If you don’t repay your loan on time, Discover might charge a $39 late fee
No joint loans allowed: Discover doesn’t allow applicants to apply with a co-borrower or co-signer
Low maximum loan amount: If you need to borrow over $40,000, you’ll need to consider another lender.
Restrictive credit score: Most approved applicants have a credit score of at least 660
Discover Personal Loans Usage Rules
Discover personal loans are primarily designed to help consumers consolidate debt, according to its latest 10-K report.
But funds can be used for just about any purpose, including:
- Vacations
- Home renovations
- Car repairs
- Moving expenses
- Medical bills
- Emergencies
- Taxes
That said, Discover restricts applicants from using funds for post-secondary education expenses, paying off a secured loan and refinancing Discover credit card debt.
Frequently Asked Questions About Discover Personal Loans
Discover doesn’t disclose its minimum credit score requirement on its website. That said, the higher your credit score, the better your approval odds and chances of qualifying for its lowest advertised APR. Most applicants Discover approved in 2022 had credit scores of 660 or higher, according to its most recent 10-K report.
How difficult it may be for you to qualify depends on factors like your credit profile, annual income, debt-to-income ratio (DTI) and desired repayment term. DTI refers to your monthly debts measured against your monthly income.
Once approved, you can receive your money as quickly as the next business day, as long as you’ve submitted all the requested documentation.
You can apply for a Discover personal loan online or by phone. Simply visit the website, click “check your rate” and enter all the requested information. Discover then performs a soft credit check to show you your potential loan options and rates without impacting your credit score.
Yes. Discover offers a prequalification process that allows them to perform a soft credit check so you can see your options before you formally submit your application.
Discover does not charge any fees for its personal loans, including origination fees, late fees or prepayment penalties.
Editor’s Note: Before making significant financial decisions, consider reviewing your options with someoneyou trust, such as a financial adviser, credit counselor or financial professional, since every person’s situation and needs are different.
Learn More About Discover
See how Discover stands out in our roundups of the best financial institutions and personal loans available today:
- #2 on Best Banks for Personal Loans
- #3 on Easiest Personal Loans to Get
- #4 on Best Fast Personal Loans
- #4 on Best Personal Loans with No Origination Fees
- #4 on Best Unsecured Personal Loans
- #4 on Best Personal Loans
- #4 on Best Low-Interest Personal Loans
- #4 on Best Online Personal Loans
- #4 on Personal Loans for Good Credit
- #4 on Best Debt Consolidation Loans
- #4 on Emergency Loans
- #5 on Personal Loans for Veterans
If you have feedback or questions about this article, please email the MarketWatch Guides team at editors@marketwatchguides.com.
