Penfed Credit Union personal loan review. Personal loan amounts $500 to $50,000.
Who is Penfed?
Penfed is the second-largest federal credit union in the country. They serve 2.9 million members. They offer a full suite of financial services to its members, including personal loans. The question we’re going to tackle today is whether you should consider applying for one of their personal loans to consolidate debt, make a big purchase, or cover a monthly shortfall. We’re going to go make sense of all their policies so you can decide whether they would be right for you. And, we know something about personal loans. We’ve worked in the lending industry for years and we currently track about a hundred national lenders. We can tell you how Penfed stacks up and what you need to know about them.
Penfed started its life as the Pentagon Federal Credit Union which served the nations military families. Today, you do not need to have an affiliation with the military to become a member. And while you don’t need to be a member to apply for a personal loan, if you choose to accept a loan from them, they will create a membership for you.
How much can you borrow from Penfed?
Penfed offers loans between $500 and $50,000. Five hundred is one of the lowest loan amounts from top-tier lenders. So, if you need just a little bit of money, Penfed could be a great option for you. And $50,000 is one of the highest. There are a handful of lenders that will lend as much as one hundred thousand dollars, but fifty thousand dollars is a more common top rate.
What are the terms of a Penfed personal loan?
Loans of this size have terms that go up to 5 years. You wouldn’t want any of these loans to be any longer than 5 years. While a longer term will lower your monthly payment, it will mean paying more interest over time. You should always select the lowest loan term you can comfortably afford.
What are the APRs for a Penfed personal loan?
Penfed’s APRs are some of the best in the industry. Their lowest APR is 8.99%. That is a percentage higher than it was earlier in the year, but it is still a great rate. Only their top applicants will qualify for their best rate. That’s why it’s so important to know that their highest APR is 17.99%. Again, that is one of the lowest top rates in the industry. If you can get approved, a Penfed personal loan could be a great way to consolidate other debt to lower the average interest rate on your debt.
If you do use Penfed to consolidate, you need to know that they won’t pay off your other creditors for you with the proceeds of the loan. Other lenders will offer that service. When a lender will do that, it often means that it will be easier to be approved by them…because they realize that the new loan will pay off your other debts and not stack on top of them.
Is it hard to be approved for a Penfed personal loan?
Penfed almost certainly approves only people with good-to-excellent credit. But, they won’t look only at your credit score when deciding whether to approve you. They will look at your credit history, income, debt-to-income ratio, payment history, and the length of your Penfed membership.
If you think you might struggle to be approved, Penfed will accept a cosigner on your application. A cosigner is someone who agrees to pay off the loan if you fail to. If your cosigner has a higher income or a better credit score, they will improve your chances of being approved. They are also likely to help you get a lower interest rate.
What is the application process like for a Penfed personal loan?
Once you start, you have thirty days to complete the application with Penfed before it resets and you would need to begin again. But, you should be able to complete the process in just a few minutes, especially if you have the needed documents handy. You will start by filling out your personal information. Penfed will run a soft credit check on you. They will only do a hard credit pull if you accept the loan. So just applying won’t hurt your credit. You will need to verify your identity with a government-issued photo ID. They will also need to verify your income through the use of a recent paystub, retirement statement, bank statements, or tax return.
What fees does Penfed charge on their personal loans?
Penfed will not charge an origination fee when you apply. And they do not charge prepayment penalties if you want to pay the loan off early. If you want to use one of their loans for debt consolidation, they will not charge a balance transfer fee. If you are late on a payment, they will charge a $29 late payment fee. That’s one of the higher late fees in the industry, so…don’t be late. Sign up for autopay to ensure that your payment is always on time.
What would a Penfed personal loan be good for?
Penfed’s loans are unsecured personal loans which means that they won’t dictate how you can use the money. However, the most common uses for these loans include credit card or debt consolidation; medical expenses; emergency expenses like home or auto repairs; life events like having a baby, adopting, moving, weddings or funerals; or facilitating major purchases like vacations and furniture.
Recommendation
I think Penfed would be a great option if you need a personal loan. So, by all means apply. But, you owe it to yourself to shop around. Lenders all have their own algorithm for deciding who to approve, how much to offer, and at what rate. Penfed might have a great APR range, but it’s possible another lender would offer you a better rate.
At The Yukon Project, we’ve tried to make shopping around easy. If you visit our marketplace page, you can filter our lenders by loan purpose, loan amount, and credit score. When you apply to any one of our featured lenders, we will check your rate with up to 40 other lenders behind the scenes. Our partners use a soft credit check so applying won’t hurt your credit. We will show you all of your approved offers so you can pick the loan that’s best for you.
If you have any experience with Penfed, please leave a comment below. We are trying to build a community of people who are willing to share their experiences so we can all make better decisions about our finances. If you found this information helpful, please like this video and subscribe to our channel. Without your support, we couldn’t keep making videos like these. We appreciate it.
See if you’re approved. Up to 40 results. Soft Credit Check.
