How many loans can you have

how many loans can you take out?

Exactly how many personal loans can someone have?  Well, the answer may be; you might be able to take out more than one loan simultaneously. But the real question is: Should you? 

In this blog, we’ll talk about the ins and outs of managing multiple loans at one time (from different or the same lender) and how you can find a solution to your financial problems, even if you have poor credit. 

Over the past decade, we have seen the arrival of a new player in the finance game: personal loans. Personal loans are the fastest-growing borrowing type.1 And there may be a few reasons for this:

  1. They come in smaller or large loan amounts and have fast application and approval processes. Typically they take 1-5 business days!2
  2. Also, many personal loans are available to people who have not-so-great credit—so there are bad credit loan options available. 

These factors can make a personal loan an extremely accessible tool.  

When you need to borrow money from a personal installment loan, sometimes you can underestimate the amount of help you need. And since they’re readily available, many personal loan borrowers consider getting an additional loan—even before their initial loan is paid off. If you are in this situation, you may be wondering how many personal loans you can have?

What Is a Personal Loan and How Many Personal Loans Can I Take Out?

A personal loan is a loan that can be used to handle different types of debts or purchases and you may be able to get multiple, sometimes from the same lender. Unlike a small business loan or an auto loan, a lender doesn’t provide a personal loan for a specific purpose. Instead, the borrower can use the money for any need in their life. But before taking out another personal loan or several personal loans, you should learn more about how personal loans impact your credit scores. 

Personal Loans and Your Credit Score

While many loans have different interest rates and terms, all of them are based on credit scores.

A credit score reflects the overall likelihood of you being able to repay any money lent or credit limit offered to you. If you have ever purchased a car, rented a home, or applied for a credit card, you most likely have a credit score. Any potential lender can perform a credit check to get your score from any major credit bureaus.

Your credit score considers the number of credit accounts or existing loan options you have, your debt to income ratio, total monthly debt payments and how strong or weak your payment history is with them.  

Generally, credit scores range from 300-850: 

  • 800-850: Excellent
  • 740-799: Very Good
  • 670-739: Good
  • 580-669: Fair  
  • 300-579: Poor/Bad

The better your score, the higher your chances of getting a personal loan with low interest rates and reasonable repayment terms. Conversely, lower scores are usually met with higher interest rates and shorter loan terms. Since bad credit can also mean a bad debt to income ratio, lenders see these types of consumers as high-risk.

Fortunately, you can get a personal loan with good and bad credit. And like any loan, they can make life a little easier.  

Uses for Personal Loans 

Personal loans are taken out for a few typical reasons, usually for an unexpected expense and they don’t have money in their bank account, continue reading to learn more: 

Use CategoryDescription of Personal Loan Use
Large PurchasesPersonal loans can be used to finance large purchases such as cars, home renovations, or expensive appliances. 
Emergencies and Life ChangesPersonal loans can provide a financial buffer in case of emergencies like medical expenses, job loss, or unexpected major repairs. 
Higher Educational ExpensesPersonal loans can be used to cover higher education expenses including tuition, accommodation, books, and other related costs. 
Debt ConsolidationPersonal loans are often used to consolidate multiple debts into a single loan with one monthly payment. 

Personal Loan Can Be Used for Large Purchases 

People are often borrowing for things that they can’t afford to pay for all at once. For example, personal loans regularly fund down payments for large purchases, medical bills, home repairs and more. And because these are usually fixed rate loans, they can be easy to repay.

Emergencies and Life Changes

Personal loans can help fill the budget holes caused by the things we can’t predict. For example, unexpected medical emergencies and sudden job loss are big reasons people take out personal loans. 

Significant life changes can also cause a need for a personal loan. Things like divorce, career changes, and moving into a new place can bring about expenses you don’t usually prepare for.  

Higher Educational Expenses

Student loans help you to pay for college tuition and other costs. These loans are offered through private and through the federal government. Federal student loans are the most popular loans, But they have restrictions. For example, many of them require the borrower to use them solely for tuition. On the other hand, private lending options can help students pay for other essential expenses, like housing and supplies.  

Debt Consolidation 

Debt consolidation is a practice where a borrower takes out one personal loan to pay off other debts. 

It’s important to know that when you consolidate debt it doesn’t get rid of your debt. Essentially, a debt consolidation company would buy all of your other debt and then charge the borrower a single monthly payment with interest. Debt consolidation is one of the top uses for personal loans because it allows borrowers to: 

  • Decrease the number of outstanding loans—and loan payments—that they have to manage. 
  • Obtain a more accessible single payment plan
  • Help raise your credit scores and improve your overall financial health.  

How to Handle Multiple Personal Loans 

As we mentioned earlier, it is possible to take out multiple personal loans at the same time. There can be a lot of reasons that someone may want to take out a second personal loan or multiple personal loans. 

For example, you may need an additional personal loan because you underestimated your actual financial need. Or, an emergency can arise where you are again faced with a situation that you can’t immediately afford and you may want to consider multiple personal loans. Whatever the cause, there are some essential facts that you have to be aware of when you take out more than one personal loan:

Your Credit Score Could Suffer With Multiple Personal Loans

Having more than one active personal loan will affect your credit score. Most likely, it will drop for a while. This may be for a few reasons including increasing your debt to income ratio and a credit check. But then, when you build up a good payment history with your new loan through on time payments, you may see that number bounce back on your credit report. However, the opposite can hurt your scores further. 

Default With Multiple Loans

Having multiple personal loans means having more personal loan payments. And if there comes the point where you can’t pay those loans back, you may see them go into default. That loan can also be hit with fees and penalties that will leave you responsible for much more money than you borrowed. To avoid default there are several strategies. Strategies for successful loan repayment can include:

  • making more than the minimum payment
  • prioritizing high-interest loans.
  • and setting up automatic payments. 

Personal Loan Alternatives

After asking yourself how many personal loans you can have and considering the best methods for loans, you may realize that a personal loan may not be the best option for you. But, that decision doesn’t erase your financial need. So, if you don’t want to take out an additional personal loan, here are some alternatives: 

Purge and Sell Instead of Multiple Personal Loans! 

If you’re looking to make some cash, It may be time to start getting your garage sale organized. Selling your old and unwanted stuff is one of the most profitable ways to make money. In addition, sellers who keep up with current financial trends can enjoy some of the highest-earning garage sales. 

If you don’t want to do the hard hustle yourself, consider taking your things to a consignment store. These types of boutiques will display and sell your stuff and share the profits with you.  

Another way to sell stuff fast is at your local pawn shop. Instead of pawning your items for a short-term loan, you may be able to sell them directly to the shop.

Get a Credit Card Instead of a Second Personal Loan or Many Personal Loans 

Credit card debt will allow you to manage a line of credit instead of a lump sum of money. For example:

  • If you take out a $2,000 personal loan, you will have to repay that total amount. But if you only use $1,000 of a $2,000 credit limit, you will only need to pay back $1,000 and will only be paying interest on that $1,000 . 

In addition, there are credit cards available with low-interest rates, and some even offer 0% APR introductory rates.  However, credit card debt can quickly add up after that introductory offer is over, especially on top of a first personal loan. And a credit card cash advance will have even higher interest rates than using credit card debt or a personal loan. 

Home Equity Loan or HELOC

If you’re a homeowner, you may be able to turn your property’s equity into a financial solution.  

A home equity loan is a loan based on the increased value of your home from the time you bought it. 

A HELOC (Home equity line of credit) gives you credit instead of cash, unlike an equity loan! And just like a credit card, a HELOC only requires you to pay back the amount of credit that you use.  

A home equity loan and a home equity line of credit uses your home as collateral. That makes these options secured loans which are more likely to come with low, fixed interest rates.  

FAQs About How Many Personal Loans Can You Have

Here is more information on frequently asked questions about how many personal loans and how many loans in general a person can have.

Can having multiple personal loans lead to a higher debt burden and potential difficulties in repayment?

Yes, having multiple loans can increase your overall debt and make it more challenging to manage repayments. It’s important to consider your ability to handle the additional financial responsibility before taking on multiple loans.

Do most lenders allow you to take out more than three loans at one time?

Generally, most lenders have policies limiting how many loans a borrower can have at one time, even if you are inquiring with the same lender. However, this can vary depending on the lender and the borrower’s financial situation such as debt to income ratio, credit score, credit report information, income and more. And so, before filling out another personal loan application make sure to know about your lender’s policy on more debt with different lenders. 

Should I always read the terms and conditions of any loan before signing the agreement?

Absolutely, it’s crucial to understand the terms and conditions of any loan agreement before signing. This includes understanding the interest rate, repayment terms, and any potential penalties for late or missed payments

Can the type of loan I’m applying for affect the number of loans I can have at one time?

Yes, the type of loan can influence the number of loans you can have. Some types of loans, like mortgages or auto loans, may have different policies compared to personal loans or credit cards.

Can I have more than three loans if I have a good credit score and a stable financial situation?

While having a good credit score and stable financial situation can improve your chances of getting approved for a loan, the number of loans you can have at one time will still depend on the lender’s policies.

Are there any personal loan forgiveness programs available?

Loan forgiveness programs are often available for certain types of loans, like student loans. Resources and support for managing loans that cannot be forgiven, can be found through financial advisors, credit counseling services, and online resources. It’s important to research and utilize these resources to make informed decisions about managing your loans.

Conclusion On How Many Personal Loans You Can Have

Pondering how many loans you can have? Personal loans may be an option for a second loan or third loan if you need to pay for unexpected expenses. Personal loans are responsible for helping people solve financial problems every day. They can sometimes give people a stable, manageable repayment plan. 

However, anything—including multiple personal loans—that are helpful can become harmful if you misuse them. Regardless of the interest rates and terms of any personal loan, there is something that a borrower must remember:

  • When you take on multiple loans, you’re taking on numerous monthly payments. This will take a large amount of your income and make it hard for you to do other important things with that money.

CreditNinja’s Thoughts on Multiple Loans

So, if you are thinking about getting multiple personal loans, consider the impact they will have on your life. Even though multiple loans can bring relief now, they will be your responsibility of juggling multiple monthly payments for years after. So, when it comes to taking out more than one personal loan, be sure to do it carefully. 


  1. The Average Personal Loan Balance Rose 7% in 2022 | Experian
  2. How much time it takes to fund a personal | NYPost
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