Paying moving costs can be stress free when you use a moving loan to help cover relocation expenses you can’t pay with savings. Whether you’re moving across town or across the country, there are multiple factors – and alternatives – to consider before applying.

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What is a moving loan?

Coordinating all the parts and expenses of moving can be stressful but moving loans can help lift some of that financial burden regardless of whether you’re moving across town, across the country, or around the world.

Moving loans, also called relocation loans, are a type of unsecured personal loan that can be used to pay for moving expenses and other costs that come once you’re settled in your new place. These loans can offer lower interest rates, easy-to-manage monthly payments, and flexibility on how and when you can use the funds. Plus, most loans are approved quickly, and you get the funds faster, giving you quick access to money to pay for what you need

Then, you can get back to caring about what matters – starting your new journey in your new home.

Related: Secured vs. Unsecured Personal Loans

How do moving loans work?

Most moving loans can be researched, compared, and applied for online. Because they are a type of personal loan, they may be offered by banks, credit unions, and online lenders. Once approved, which can happen in as little as 24 hours to a few business days, you’ll receive the funds and be able to use them for your moving needs.

Then, you’ll be required to make monthly payments, or installments, to pay back the loan. This will include the principal, which is the original loan balance, plus interest. You’ll make these payments over the life of the loan, or term, until it is completely repaid.

The good news is these loans are typically easy to understand, easy to qualify for, and you get the funds fast, so you can check it off your to-do list and continue packing.

How can you use a moving loan?

Use a moving loan to pay for:

  • Hiring a moving company
  • Renting a moving vehicle
  • Moving insurance
  • Packing supplies
  • Storage space
  • Overnight hotel stays
  • Transporting your vehicle
  • Purchasing new furniture
  • New home repairs
  • Security deposits
  • Other unexpected expenses

Whether the moving expenses are large or small, using a moving loan to fund them can help ease the financial burden of relocating.

Where do I get a personal loan for moving expenses?

Personal loans are available from a variety of lenders ranging from banks, credit unions, and online lenders. The best option will depend on the interest rate offered, loan terms, and other features. Online lenders are typically the quickest way to receive a personal loan, allowing you to be approved online in minutes with all the correct information.

In general, credit unions will offer a moving loan to those with fair to bad credit. You may have to create a membership account to get approved for the loan, which can cost money. Banks, on the other hand, will likely require a higher credit score but may be willing to offer more.

When is it right to get a personal loan for relocation?

Personal loans for moving can be extremely beneficial but determining when it’s necessary can be a challenge. Relocation of any type can be quite expensive, and some common expenses that you may see include:

  • Moving costs associated with movers or moving vehicles
  • Completing the first and last month’s rent on your new place
  • The new home’s security deposit
  • Pet deposits

Assuming you don’t have cash on hand to cover these expenses, a personal loan for moving can help with moving expenses.

Related: Reasons to get a personal loan

Who moving loans are best for?

Loans for moving out of state or within state can be helpful for anybody who doesn’t have the reserves of cash on hand that are needed to cover moving expenses. Those with lower credit scores should acknowledge that they may not receive favorable interest rates on these personal loans. A moving assistance loan can help anybody cover necessary moving expenses assuming you don’t have or don’t want to shell out the money out of pocket all at once.

Is a moving loan a good idea?

Moving and relocation loans can be an excellent idea assuming you are able to secure a favorable interest rate and loan terms. If you can repay the loan payments in full and on time, loans to help with moving costs can be a great idea. Be aware that adding additional debt to your budget when you already have existing unpaid debt can be a dangerous idea that can negatively impact your credit.

Pros and cons of moving loans

Pros of moving loans Cons of moving loans
  • Lower interest rates than some alternatives, like credit cards.
  • Fast funding, in some cases in as little as one business day.
  • Large loan amounts to cover all of your moving expenses and set up the new place.
  • Fixed interest rates and predictable payments, which can help with budgeting.
  • Typically unsecured, so you don’t need collateral.
  • A personal loan is debt, which can affect your credit score.
  • You’ll potentially be paying off your move for years after the move is over.
  • Some lenders charge origination or other fees.
  • High rates for borrowers with poor credit (629 or lower).
  • Interest will add to your overall moving costs.

Alternatives to moving loans

A moving loan can be a great option for funding relocation expenses, but it’s not the only one. A few alternatives to moving loans include:

  • Credit cards: Take advantage of a 0% APR credit card, which will not charge interest during the introductory period (typically 12-18 months). This can be an option for borrowers with excellent credit, as you’d qualify for a higher credit limit that can cover your expenses. However, be sure you can pay off the balance before the introductory period ends; otherwise, you’ll likely be charged a high interest rate.
  • Start a side hustle: Earn extra income to fund your moving costs by starting a side hustle. This can be anything you do on the side to make extra cash. Generally, this is freelance work but can include starting a blog, teaching an online course, writing an eBook, creating and selling goods or crafts, being a social media influencer, or something else.
  • Sell your things: As you pack up your old place, put aside clothes, accessories, technology, books, gadgets or other items you can sell. Turn to sites like eBay, Facebook Marketplace, or Craigslist. Or hold a moving sale.
  • Relocation package: If you’re moving for a new job, ask your new employer if they offer relocation packages that would pay for some or all your moving expenses.
  • Help from family/friends: Instead of hiring a moving company, ask your family or friends to pitch in. They can help you pack and unpack your things or may have a truck or supplies you can borrow instead of renting or purchasing.
  • Save: Most of the time, moving isn’t a spur of the moment decision, so you have some time to set money aside. Choose an option like a high-yield savings account. Saving any extra cash over a period may be enough to cover what you need.
  • Ask about financing options. Some moving companies may offer financing options, such as a payment plan. Ask if there are options available to you but be sure to read the fine print and understand all the terms and conditions to avoid surprises down the road.

How a moving loan will impact your credit score?

A moving loan will have a positive impact on your credit score over time if you are able to meet all your payments on time and in full. However, falling behind on your payments and sending your loan into delinquency or default can quickly damage your credit score. This can have a negative effect on your odds of being approved for loans in the future and can even damage your credit score by as much as 100 points if you don’t meet your payments.

Moving loans for bad credit

Even if you have poor credit, you can still qualify for a personal loan to use for moving expenses. These funds can still be used for any expenses related to moving, such as renting a truck or moving company, buying packing and shipping materials, storage fees, etc. But depending on how bad your credit is, getting approved may be a little tougher.

The minimum credit score required for most personal/moving loans is 580. If your score is below this, take time to improve your score prior to applying for a loan:

  • Make any debt payments on time and in full each month
  • Decrease your debt-to-income ratio
  • Check your credit report and make sure there are no errors
  • Aim for 30% or less credit utilization

If your score is at least 580, compare online lenders to find the best option. Just be aware that:

  • You’ll likely have a much higher interest rate
  • You may have to have a cosigner on the loan
  • You may only qualify for a secure loan, which means you’d have to put up collateral

Pros and cons of moving loans for bad credit

Pros Cons
  • Fixed interest and fixed payments help with budgeting.
  • If you qualify for an unsecured loan, you don’t need to provide collateral.
  • Application and funding process is still relatively quick, and can likely be done online.
  • A personal loan is debt, which can decrease your credit score temporarily.
  • You may only qualify for high interest rates, adding to your total debt amount and overall moving costs.
  • Some lenders charge origination or other fees.
  • You may need a cosigner.
  • You may need to give collateral for a secured loan.
  • You may not have as many lender options.

How to qualify for a moving loan?

In order to qualify for a personal loan for moving expenses, you must meet the lenders criteria for factors like:

  • Credit score
  • Credit history
  • Income
  • Debt-to-income ratio

Each lender has different sets of criteria, so it’s important to do research and compare your options before applying.

For most lenders, you’ll qualify for the best interest rate and most favorable terms if you have a higher credit score and clean credit history. You also must show reliable income to prove you’ll be able to repay the loan.

If you can, get prequalified for the loan. This triggers a soft credit check, which doesn’t affect your credit score, and can give you an estimate of interest rates and monthly payments to help you compare more personalized options.

How to compare moving loan lenders?

You’ll find many lenders offer personal loans that can cover moving expenses. To find the one that’s right for you, compare:

Interest Rates The lower the rate, the less you’ll pay over the life of the loan.
Loan Amounts Check the loan minimum and maximum amounts available and make sure they meet your needs.
Repayment Terms Longer terms will give you a lower monthly payment, but you’ll pay more in interest. A shorter term may have a higher monthly payment, but you’ll save money over time.
Fees Check for application fees, origination fees, prepayment penalties, and other fees that can vary but also add to the total cost of the loan. By comparing annual percentage rates (APR), you’ll get a more accurate representation of interest + fees.
Eligibility Requirements Check credit score, income, and other requirements.
Other features Some lenders offer other features like fast funding, prequalification, online applications, and more. Also check customer service reviews and ratings.

Compare: Best Personal Loans

How to apply for a moving loan?

  1. Know your needs. The first step is to estimate your total moving expenses so that you know the loan amount you need to borrow. Factor in any costs for both moving and for the new place if necessary. Personal loans come in a lump sum, so you’ll want to request a loan that covers all of your planned relocation expenses.
  2. Shop lenders. Compare interest rates, loan amounts, repayment terms, fees, eligibility requirements, and other features. If you can, prequalify with the lender to get a personalized estimated loan amount, APR, and monthly payments.
  3. Choose your best option. After comparing lenders, choose one that has the best rate and term, the loan amount you need, and the lowest fees.
  4. Submit the application. Most lenders allow you to complete and apply online. To make this process as quick and smooth as possible, prepare your information and documentation ahead of time. Be ready to provide information like your address, income, and place of work. You may also have to submit documentation like Social Security numbers, W-2s or pay stubs.
  5. Finalize the loan agreement. Some lenders approve an application within 24 hours or a few business days. Once approved, you’ll receive a loan agreement to review and sign. After you sign it, you’ll get the funds sent to you.
  6. Get your loan funds. This can happen quickly, even as fast as same-day transfer, though it could take up to five business days. Most of the time the funds are directly deposited into your bank account.
  7. Repay the loan. Once you receive the funds, you’ll have to start making the monthly payments to pay it off. Have a plan to ensure you can make your payments on time, which not only can build your credit score, but also help you avoid late fees or penalties.

FAQs

Taking out a moving loan is one way some people can afford the expenses associated with moving. However, alternatives include using a 0% APR credit card, earning extra cash from a side hustle or working extra hours, selling their things, asking friends and family for help, or saving for a longer period.

Some states offer credit for relocating to parts of eligible areas. Check with your state or the city you’re moving to in order to learn whether this is an option.

A moving expenses loan can be an excellent choice for people with strong credit who don’t want to pay for moving expenses out-of-pocket all at once. Financial assistance for moving expenses can make the entire moving process go more smoothly by allowing you to focus on completing the move.

Yes, relocation and moving loans are two names for the same type of personal loan that can be used for moving expenses.

Yes, you’re able to move to another country using funds from a moving loan.

Depending on where you apply for the best moving loans, the process can range from being approved or denied in a couple minutes to if a week. Online lenders have the potential to be the quickest way of getting approved.

Moving costs can vary depending on whether you are staying in the state, renting a moving truck, hiring movers, how many items you need to move, and other factors. However, the national average for moving is around $1,400.