Laurel Road personal loan review: A good option for home improvements and debt consolidation

Pros

• No origination or prepayment penalty feesnAutopay discountnOffers personal loan refinancing

Cons

• Funding time frame: 7+ business daysnLimited loan termsnLowest APR offered is higher than some competitors

What you need to know about a Laurel Road personal loan

Laurel Road is an online lender that initially focused on private student loans and student loan refinancing. Over time, Laurel Road expanded its products to include mortgages and unsecured personal loans.

Laurel Road is a division of KeyBank, an FDIC-insured bank. It operates in all 50 states, Washington, D.C., and Puerto Rico. Its loan amounts range from $5,000 to $45,000.

Highest loan amounts reserved for debt consolidation, home improvements and major purchases

Laurel Road says you can use its personal loans for anything except education-related expenses. But it’s important to point out that not all loan uses qualify for its maximum loan amount.

To potentially qualify for a $45,000 loan, you’ll need to use the money for home improvements, debt consolidation or a major purchase. If you plan to use the money for another purpose (like to buy a car or finance a business venture), Laurel Road caps loan amounts at $35,000.

No origination or prepayment fees

You don’t have to worry about paying administrative fees if you apply for a Laurel Road personal loan. The lender doesn’t charge any application fees, origination fees or disbursement fees.

There’s also no prepayment penalty if you want to pay off your loan early.

Competitive rates and rate discounts

Every percentage point can make a difference when it comes to the interest you pay on a loan. Laurel Road’s personal loan interest rates can be competitive, but you may be able to find a lower rate elsewhere if you have excellent credit.

Laurel Road will give you a 0.25% interest rate discount if you set up autopay from your bank account. And current Laurel Road customers may earn an unspecified relationship discount.

Personal loan refinancing

Do you already have a personal loan? If so, you may be able to refinance your current loan into a refinance loan with Laurel Road that has better terms or a more attractive interest rate.

And if you’re already a Laurel Road customer, you can apply to refinance your existing Laurel Road personal loan.

Loans for certain medical professionals

If you’re a health professional, Laurel Road may have a personal loan designed specifically for you.

• Doctors and dentists — If you’re a practicing physician or dentist, you can apply to borrow up to $80,000 with loan terms ranging from three to seven years.
• Medical/dental residents and fellows — You can apply to borrow up to $45,000 (with payments as low as $25 per month for qualified borrowers) while you’re in residency. Credit decisions are based on what Laurel Road estimates you’ll earn after residency.

A closer look at a Laurel Road personal loan

If you’re considering a Laurel Road personal loan, here are a few more things you should know.

• Limited loan terms — Laurel Road only offers loan terms of three, four or five years for most personal loans. Certain health professionals may be eligible for loan terms of up to seven years.
• Widespread availability — Laurel Road personal loans are available in all 50 states, plus Washington, D.C., and Puerto Rico.
• Co-signers allowed — If your credit isn’t great, the ability to apply for a personal loan with a co-signer can be a great option. Laurel Road offers this — so that could improve your odds of getting approved for a loan or receiving a lower interest rate.

Who a Laurel Road loan is good for

If you’re a medical professional or resident/fellow, a Laurel Road personal loan could be worth a look. Beyond those specific career fields, Laurel Road may also be a good option for people with strong credit. (But you’ll still want to shop around, because some lenders offer lower starting interest rates.)

Laurel Road could also be a good option if you don’t need a very short or long loan term. With the exception of its physician-specific loans, the company only offer three-, four- and five-year terms. If you only want to take out a small personal loans, it might not make sense to pay it off over three years or more.

For that reason, Laurel Road is a better option if you want to finance home improvements or you’re thinking about debt consolidation.

How to apply with Laurel Road

To be eligible for a Laurel Road personal loan, you’ll need to be a U.S. citizen or permanent resident with a valid I-551 card showing at least 10 years between the “Resident Since” date and the “Card Expires” date. And your credit and debt-to-income ratio will also affect your eligibility.

Laurel Road offers a prequalification option to check your eligibility and potential rate before you move on to the final application. That soft credit inquiry won’t hurt your credit scores, but submitting your full application will result in a hard credit inquiry, which can lower your scores by a few points.

Laurel Road’s initial application can be filled out online in a matter of minutes. But if you need to get your hands on the money quickly, Laurel Road may not be the best choice. The company says that the average approved loan is funded in about seven business days.

Before pulling the trigger on a Laurel Road personal loan, be sure to consider all of your lending options.

• For instance, finding a lender that offers secured personal loans could be a good choice if you have assets that could be used for collateral (like a CD or savings account).
• And if you have good credit, a balance transfer card with a 0% intro APR period could be a strong choice for credit card debt consolidation.

Not sure if Laurel Road is right for you? Consider these alternatives.

• LightStream: If you have strong credit, LightStream may offer you a lower interest rate and more repayment term options.
• Upstart: This online lender considers factors like your education when you submit a personal loan application.

*Approval Odds are not a guarantee of approval. Credit Karma determines Approval Odds by comparing your credit profile to other Credit Karma members who were approved for the personal loan, or whether you meet certain criteria determined by the lender. Of course, there’s no such thing as a sure thing, but knowing your Approval Odds may help you narrow down your choices. For example, you may not be approved because you don’t meet the lender’s “ability to pay standard” after they verify your income and employment; or, you already have the maximum number of accounts with that specific lender.