It’s no secret Americans adore their furry companions, to the point where some say their pets deserve human-quality healthcare. Some millennials and members of Gen Z are even willing to turn down big paychecks to work remotely and spend more time with their pets. So, when your furry friend needs care and the veterinary bill comes in higher than expected, what are your options? One you might consider is a pet loan—which is just a type of personal loan.
We’ll explain how pet loans work, what they can be used for, and the pros and cons.
What is a pet loan?
As you shop around, you might not necessarily see these loans labeled “pet loans” on bank and credit union materials. That’s because a pet loan is essentially just a personal loan you use to cover pet-related expenses.
Some positive features of personal loans is that they are typically unsecured—meaning you don’t have to put up collateral—and they can oftentimes charge lower interest rates than if you carried a balance on a credit card. By way of contrast, common types of secured loans include auto loans and mortgages, where your vehicle or your home can be taken by the lender if you default on your obligation to repay the debt.
It’s common for loan funds to be deposited directly into your bank account. Or, if you already put the charge on a credit card, you will generally have the option to direct the loan funds toward your card balance.
What can a pet loan be used for?
A few common pet-related expenses one might consider a personal loan for include:
- Medications.
- Surgeries.
- Visits to an emergency vet.
Keep in mind that personal loan funds can be used for almost any purpose, as long as it’s legal.
When is a pet loan a good idea?
We wouldn’t necessarily recommend taking out a personal loan to cover normal pet-related expenses that one can plan ahead and budget for. As an example, adoption fees and the cost to spay or neuter your pet are mostly known factors that shouldn’t take you by surprise.
But, unexpected medical bills are another matter. Whether you’re dealing with your usual vet or you have to visit an emergency vet, these bills may cost hundreds or thousands of dollars.
For example, the insurance company MetLife notes that fixing a broken bone could run $2,400 or more, and that an emergency trip to deal with poisoning/toxic substances might cost in the vicinity of $5,000.
In cases where your pet’s quality of life or even life itself is on the line and you don’t have thousands of dollars in cash readily available, a pet loan can be an incredibly valuable tool.
Pros and cons of a pet loan
Pros
- Funds can be used for almost anything
- Typically won’t require collateral
- Rates might be lower than credit cards
- Sometimes can be funded the same day
Cons
- Interest charges are unavoidable
- Some loans may come with costs such as origination fees or prepayment penalties
- Typically require a good or better credit score
- Will involve a hard inquiry
Alternatives to a pet loan
Paying with a credit card
We don’t recommend carrying a balance on a credit card for a long period of time and incurring interest charges. With many credit card rates north of 20%, this can quickly get expensive.
However, there are situations where paying your vet bill with a credit card can make sense. If you just need flexibility for a couple months, you might decide to bite the bullet on incurring interest briefly and aggressively pay down the debt as your next few paychecks come in.
For example, estimating a $1,000 balance on a credit card with a 22% annual percentage rate (APR), with a $275 payment each month you could pay in full in four months and pay about $46 in interest. An obvious caveat is that you don’t want to increase the debt with new spending.
If you have the opportunity to open a credit card with a 0% introductory APR offer, you might be able to avoid interest charges entirely. A 0% APR intro period provides the customer with a specified number of months where purchases or balance transfers or sometimes both will not incur interest. You still have to make payments for at least the minimum amount each month.
After the intro period ends, any remaining balance incurs interest at the normal APR.
Used wisely, a card with a 0% intro APR on purchases can be a smart financing option. Just know that most of these cards require good to excellent credit to qualify, and there will typically be a hard inquiry on your credit report as the issuer decides whether to approve you.
Also know that 0% intro APR periods differ from deferred interest, though the two can look similar at first glance. However, there’s a key element that makes deferred interest significantly riskier—if you fail to pay off the entirety of your debt before the promotional period ends, on a deferred interest plan you’ll be charged interest on the full purchase from the date you made the purchase. And, as many of these products have sky-high rates, that could be a hefty sum.
One situation where pet owners may encounter deferred interest is if a veterinary office suggests the CareCredit credit card as a financing option. When you see a promotional financing plan on this card with “No Interest if Paid in Full” language, that indicates a deferred interest plan.
Setting up a payment plan
It’s worth asking if your vet offers a payment plan that will allow you to spread the cost of an expensive procedure over several months. Just know that while it’s possible some clinics may offer an in-house payment plan, it’s probably more likely you’ll be presented third-party financing options such as the CareCredit credit card or a Scratch Pay plan.
As of this writing, Scratch Pay offers plans ranging from 12 to 36 months for repayment, in amounts from $200 to $10,000. The annual percentage rate (APR) may range from 0% to 36%. Terms apply.
Requesting nonprofit assistance
You may be able to apply for help from a charitable organization for grants and other forms of assistance. But, be aware some programs will have income-based restrictions, and some organizations do not offer assistance for emergency care. Pet parents may look to the Pet Help Finder website as a useful place to begin their research. It’s also worth checking with local rescue groups and shelters to ask if they can connect you with programs specific to your community.
Getting care from a veterinary school
Sometimes, a veterinary school might be able to offer a procedure cheaper than what you’d likely be quoted at a veterinary clinic/animal hospital. The American Veterinary Medical Association provides a list of accredited veterinary colleges that can be a good starting point if you’re looking for a vet school that might be able to help with your furry loved one’s needs.
Accessing your paycheck early
Depending on the amount of the vet bill you wish to cover, you might not need to take out a loan. If your next paycheck will provide enough to cover the expense, it could be worth considering a service that provides Earned Wage Access.
Earnin is one such service, advertising the ability to access up to $150 per day with no interest, no credit check, and no mandatory fees. DailyPay is another such service, allowing employees of participating companies access what they’ve earned after their hours are approved, rather than waiting on the usual payroll schedule.
Terms apply, and you may incur fees for some of these services. For example, Earnin suggests that users tip whatever they feel is fair—and offers expedited transfers with fees starting at $3.99. DailyPay also advertises instant access to earnings for a $3.49 flat fee.
We don’t recommend using services such as these as a crutch to replace regular budgeting. But in cases where you simply need to bridge a gap, they may be worth a look.
What about pet insurance?
At the risk of stating the obvious, pet insurance can be helpful, but only if you get it ahead of time. If you’re looking at taking out a pet insurance policy, make sure to thoroughly research what it does and does not cover. For example, it’s common for pet insurance to exclude preexisting conditions and injuries, as well as routine checkups and vaccinations.
As of 2024, the average premium in the U.S. to cover dogs with an accident and illness policy was $749.29 per year, while an accident-only policy averaged $193.29 per year, according to the North American Pet Health Insurance Association. For cats, those types of plans averaged $386.47 and $110.03 per year, respectively.
The takeaway
Whether your beloved companion is a dog, cat, bird, reptile, or something else, their well-being is likely at the top of your mind. In situations where you’re dealing with an unexpected vet bill of hundreds or thousands of dollars, a personal loan may be a good tool to help you cover the expense.
While taking out a personal loan will incur interest charges, these are likely to be at a lower rate than if you carried a balance on a high-APR credit card.
Depending on the specifics of the situation, other options worth considering include asking your vet about a payment plan, paying with a credit card offering a 0% intro APR period, or researching charitable assistance available in your area.
Frequently asked questions
What credit score do you need for a pet loan?
Specific requirements will vary by lender. However, for the best likelihood of approval and a low rate, applicants will generally want to have a good to excellent FICO Score—meaning one in the 670 to 850 range.
Can you get a pet loan with bad credit?
Looking at FICO’s scoring model, a credit score of 580 to 669 is considered “fair” while one of less than 580 is considered “poor.” Some lenders may extend financing to consumers whose scores fall in the poor credit range, but be aware this is likely to come with high interest rates and potentially expensive fees as well. If this is your financial situation, you’ll need to exercise care to avoid lenders with opaque terms and practices that may sometimes border on predatory.
What’s a good APR for a pet loan?
The average rate for a 24-month personal loan was 11.14%, per the most recent numbers available from the Federal Deposit Insurance Corporation (FDIC) as of this writing. If you secure a rate in that range or lower on your loan, you can feel pretty confident you’ve gotten a good APR.
