Personal loans are very flexible loans that you can use for almost anything. With a loan like a mortgage or a car loan, you need to have a specific reason for borrowing money. But personal loans can be used to cover emergency expenses, consolidate debt, or help start a project.
Usually, personal loans are relatively small, unsecured loans with a repayment period of a few years. But sometimes you need to borrow a large sum, which means you may need more time to pay off the debt. This is where long term personal loans come in.
Long-term personal loans make it easier to borrow large amounts while maintaining a reasonable monthly payment. This guide covers some of the best options for a long-term personal loan and how you can get the most out of the loan you choose.
In this review:
What is a long term personal loan?
A long-term personal loan is like any typical personal loan. You can borrow money for almost any purpose, usually without paying a security deposit. The main difference is that long-term personal loans give you more time to pay off your debt than short-term loans.
With a standard personal loan, you usually have between two and five years to pay off the loan. Long-term personal loans can have repayment terms of up to 15 years. This makes the monthly payment more manageable, but stretches the interest charges over a longer period.
In effect, you benefit in the short term from lower payments at the long-term expense of a high total cost for the loan.
Where to find long term loans online
Physical banks are one of the most common sources for personal loans, but they are not the only option. Many banks offer personal loans through their websites, and there are also a variety of online loans.
In fact, some of the best personal lenders operate solely online, thanks to their lower overhead.
We’ve analyzed dozens of personal lenders, ranked them by their target credit profile, and narrowed your options down to those that offer long-term loans.
As with any type of loan, having a good to excellent credit rating gives you more options and likely a lower interest rate when applying for a long-term personal loan. Generally, lenders consider credit scores of 700 or higher to be good.
LightStream is an online lender that offers a wide variety of loan types, including long-term personal loans with high loan limits.
- Terms of office: 24 – 144 months**
- Loan amounts: $5,000 – $100,000
- APR: 3.49% – 19.99%* with automatic payment
- Credit range: Excellent, good
- Full review: LightStream Personal Loan Review
SoFi is an online lender that might be best known for its student loans. It has diversified into other types of loans and now offers personal loans alongside its other financial products.
- Terms of office: $5,000 – $100,000
- Loan amounts: 24 – 84 months
- APR: 5.99%- 9:20 p.m.%
- Credit range: Good
- Full review: SoFi Personal Loan Review
Citizens Bank is a physical institution based in Providence, Rhode Island. It offers loans to customers throughout New England and a few other states.
Marcus by Goldman Sachs is an online bank that offers both savings accounts and personal loans.
- Terms of office: 36 – 72 months
- Loan amounts: $3,500 – $40,000
- APR: 6.99% – 19.99%
- Credit range: Fair
- Full Review: Marcus Personal Loan Review
>> Do you have a bad credit rating? Check Bad Credit Loan Options Here
Where can I find a personal loan over 15 years?
Fifteen years is a very long repayment term for a personal loan. The most common loan with a term of this length is a mortgage, so lenders are generally hesitant to offer unsecured loans with such long repayment terms.
Of all the lenders we looked at, the only one offering 15-year personal loans is Navy Federal Credit Union. NFCU is a great lender if you are eligible to borrow from them, but eligibility requirements can be strict. Only members of the military and their families can register.
If you want to learn more about the NFCU and its loan options, check out our review of Navy Federal Credit Union personal loans.
Advantages and disadvantages of long-term loans
- Lower monthly payments are easier to manage
- Borrow larger amounts to cover larger purchases or expenses
- No collateral required
- A fixed interest rate and long maturities ensure predictable and stable payments
- Higher interest rates
- More time for interest to accrue
- Fewer loan options
How a long-term loan could affect your finances
Long-term personal loans are very flexible, but they also have a long-term effect on your financial situation. If you take out a 15-year loan, it’s going to weigh on your finances for a decade and a half.
Consider this example. You have credit card debt at high interest rates and want to consolidate it into a single loan. You decide to take out a $35,000 personal loan at 7.99% to consolidate all your debts. Here’s what your repayment plan would look like for different loan terms.
|Term||Monthly payment||The interest cost||Total loan cost|
|15 years old||$334.28||$25,170.40||60 $170.40|
The difference between each term is significant. Longer terms can reduce your monthly bill by several hundred dollars, but cost significantly more over the life of the loan. The longer you allow interest to accumulate on a loan, the more expensive the loan becomes.
This makes your credit history extremely important if you are considering a long-term loan. The higher your credit score, the lower the interest rate on the loan, reducing the impact of a longer term loan. Consider the following example, assuming a personal loan of $35,000 with a term of 15 years.
|Interest rate||Monthly payment||The interest cost||Total loan cost|
The bottom line: A loan with an interest rate just 2 percentage points higher can cost you thousands of dollars over the life of a long-term loan.
>> Learn more: How do personal loans work?
Who should (and shouldn’t) consider a long-term personal loan
Long-term personal loans can be useful in certain situations, but they are not a panacea for financial problems.
When to consider a long-term personal loan:
- You want to finance a major home improvement project that will add value to your home.
- You are consolidating large amounts of credit card debt.
- You have a medical emergency and have no other way to manage the costs.
When a long-term personal loan is a bad idea:
- You are trying to pay for a discretionary purchase, such as a vacation.
- When you can easily manage a shorter repayment term.
*The terms of your loan, including the APR, may differ depending on the purpose of the loan, the amount, the term and your credit profile. Excellent credit is required to qualify for the lowest rates. The fare is shown with the AutoPay discount. The AutoPay rebate is only available before the loan is funded. Rates without AutoPay are 0.50% higher. Subject to credit approval. Conditions and limitations apply. Advertised rates and conditions are subject to change without notice.
**Payment Example: Monthly payments for a $10,000 loan at 5.95% APR with a three-year term would result in 36 monthly payments of $303.99.