Whether it’s time to pay for home repairs, consolidate credit card debt, start a business, or something else, a personal loan can be an efficient way to fund your goals.
There are several types of lenders that offer personal loans, but the best option for you will depend on how much money you need, how quickly you need it, and how good your credit is. Learn about the pros and cons of four popular options before deciding where to go for a loan.
Where can I get a personal loan?
The better your credit, the more options you’ll have when choosing a personal loan. Even borrowers with bad credit could find a lender among these four categories.
1. Major bank
A few major banks offer unsecured personal loans. Wells Fargo, for instance, offers loans ranging from $3,000 to $100,000 to qualified applicants, while Citibank offers loans of $2,000 to $50,000.
Pros: Your current bank might offer an interest rate discount if you have an open account. Wells Fargo offers a 0.25% relationship discount to customers and Bank of America offers a rate discount of up to 0.75% in some circumstances. Since you already banking there, you can keep all your financial products in one place. Plus, major banks have many branches nationwide, which can be convenient if you need to meet a banker in person.
Cons: You have to be in good standing with your bank at the time you apply for a loan. Whether you’re a current customer or not, you need to have great credit.
Best fit for: People with excellent credit will benefit from the lowest interest rates available at a major bank.
2. Local bank
A local bank essentially is a small business in your community. Since each bank is operated individually, loan policies vary from location to location.
However, local banks, also known as community banks, often place an emphasis on learning the needs of their neighborhood. According to the Independent Community Bankers of America, these small banks also might be more flexible in their lending practices. For example, instead of considering only your credit report and income, community banks might also look at your family history and discretionary spending before approving you for a loan.
You can search online to find a local bank in your area.
Pros: Local banks work closely with the community, so their service can be more personalized. Some people prefer local banks because they can develop a relationship with the same banker over time.
Cons: Community banks might have fewer products. And if you’re traveling or moving out of state, you likely won’t have access to a branch.
Best fit for: If you have less-than-perfect credit, a local bank might be more willing to work with you.
3. Credit union
People who wonder “Where can I get a personal loan?” often overlook credit unions, but it’s a mistake that could prove costly.
A credit union is similar to a local bank, but instead of being a small business, it’s a cooperative financial institution owned by its members. At a credit, you’re not a customer but a part-owner when you join it.
This locator map can help you find a credit union near you.
Pros: Credit unions, unlike major banks, often give small personal loans to borrowers. And because credit unions are not-for-profit institutions, they also might offer better interest rates for members and be willing to lend money to those who don’t have outstanding credit.
Cons: Just like local banks, credit unions might not have out-of-state locations unless they’re part of a larger financial network. And you have to be a member of a credit union to access its services. While some allow you to join by making a small donation to certain causes, others are tied to places of work or religious organizations.
Best fit for: If you’re looking for a small loan and have fair to bad credit, a credit union might suit you.
4. Online lender
Because of the competitive marketplace of online lending, you can choose from a variety of online lenders. In addition, there’s more flexibility in how they evaluate your creditworthiness and how you repay the loan. Lenders such as SoFi and Earnest offer interest rates of below 6.00%, while Avant requires a minimum credit score of 580, which can help if you don’t have excellent credit.
Online lenders also are known for having more flexible repayment terms and making good use of technology. Earnest, for example, lets you choose your preferred monthly payment amount and make extra payments without fees. Some lenders also let you conduct transactions through their smartphone apps so you can manage your finances on the go.
Pros: You can apply online. Most online lenders do a soft credit check when you check your rates, which means it won’t impact your credit negatively. They do a hard credit check only when you formally apply for a loan.
Cons: Since everything is done entirely online, you can’t have a face-to-face talk with a representative if you have problems with your loan.
Best fit for: If you’re looking for a loan that’s convenient to manage and can be individualized, online lenders could meet your needs.
What to keep in mind before you choose a lender
It’s important not only to compare interest rates before signing for a loan but also to weigh other benefits offered by each lender. For instance, you might decide to go with a lender that offers flexible payments or fewer fees even though it charges a slightly higher interest rate.
If you research all your options and do the math on each loan, you’ll be one step closer to answering your “Where can I get a personal loan?” question.
Interested in a personal loan?Here are the top personal loan lenders of 2018!
|Lender||APR Range||Loan Amount|
|1 Includes AutoPay discount. Important Disclosures for SoFi.
2 Includes AutoPay discount. Important Disclosures for Payoff.
3 Important Disclosures for FreedomPlus.
4 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
5 Important Disclosures for LendingPoint.
6 Important Disclosures for LendingClub.
All loans made by WebBank, Member FDIC. Your actual rate depends upon credit score, loan amount, loan term, and credit usage & history. The APR ranges from 6.16% to 35.89%. For example, you could receive a loan of $6,000 with an interest rate of 7.99% and a 5.00% origination fee of $300 for an APR of 11.51%. In this example, you will receive $5,700 and will make 36 monthly payments of $187.99. The total amount repayable will be $6,767.64. Your APR will be determined based on your credit at time of application. The origination fee ranges from 1% to 6% and the average origination fee is 5.49% as of Q1 2017. There is no down payment and there is never a prepayment penalty. Closing of your loan is contingent upon your agreement of all the required agreements and disclosures on the www.lendingclub.com website. All loans via LendingClub have a minimum repayment term of 36 months or longer.
7 Important Disclosures for Earnest.
8 Important Disclosures for Avant.
* The actual rate and loan amount that a customer qualifies for may vary based on credit determination and other factors. Funds are generally deposited via ACH for delivery next business day if approved by 4:30pm CT Monday-Friday. Avant branded credit products are issued by WebBank, member FDIC.
** Example: A $5,700 loan with an administration fee of 4.75% and an amount financed of $5,429.25, repayable in 36 monthly installments, would have an APR of 29.95% and monthly payments of $230.33
* Important Disclosures for Upgrade Bank.
Upgrade Bank Disclosures
** Accept your loan offer and your funds will be sent to your bank via ACH within one (1) business day of clearing necessary verifications. Availability of the funds is dependent on how quickly your bank processes this transaction. From the time of approval, funds should be available within four (4) business days.
|7.73% – 29.99%||$1,000 - $50,000||Visit Upstart|
|6.26% – 14.87%1||$5,000 - $100,000||Visit SoFi|
|6.99% – 35.97%*||$1,000 - $50,000||Visit Upgrade|
|5.99% – 24.99%2||$5,000 - $35,000||Visit Payoff|
|4.99% – 29.99%3||$10,000 - $35,000||Visit FreedomPlus|
|5.99% – 18.99%4||$5,000 - $50,000||Visit Citizens|
|15.49% – 34.49%5||$2,000 - $25,000||Visit LendingPoint|
|6.16% – 35.89%6||$1,000 - $40,000||Visit LendingClub|
|6.99% – 18.24%7||$5,000 - $75,000||Visit Earnest|
|9.95% – 35.99%8||$2,000 - $35,000||Visit Avant|