Most major banks and credit unions offer personal loans, but the terms, rates, and speed vary widely
Personal loans are available from national banks like Chase, Bank of America, and Wells Fargo; regional banks; credit unions; and online lenders. Each type has different approval timelines, interest rates, and loan amounts. A national bank might take five to seven business days to fund a loan, while an online lender might fund in one to two days. Credit unions often offer lower rates to members but require membership first. The interest rate you receive depends on your credit score, income, and debt-to-income ratio — not on the bank alone.
The choice between a bank, credit union, or online lender comes down to what matters most to you: speed, interest rate, loan size, or the ability to work with someone in person. This guide covers where to find personal loans, what to expect from each type of lender, and how to compare offers.
Key Takeaways
- National banks like Chase and Bank of America offer personal loans with rates typically between 6% and 36%, depending on your credit score and the loan amount.
- Credit unions often charge lower rates than banks but require membership, which may take a few days to establish.
- Online lenders fund loans faster — sometimes within 24 hours — but may charge higher rates or have stricter verification requirements.
- Your interest rate depends on your credit score, income, and existing debt, not just the lender you choose.
- Comparing offers from at least three lenders before accepting shows you the real range of rates available to you.
National banks and their personal loan programs
Chase offers personal loans from $500 to $40,000 with rates ranging from about 6.99% to 19.99% for customers with good to excellent credit. Approval and funding typically take five to seven business days. You can start the process online or in a branch. Chase requires a credit score of around 670 or higher for approval, though the exact requirement varies.
Bank of America offers personal loans from $10,000 to $100,000 with rates from 6.99% to 20.85%. Funding takes three to five business days after approval. Bank of America customers may see slightly faster processing. The bank does not publish a minimum credit score requirement, but approval is more likely with a score above 680.
Wells Fargo offers personal loans from $3,000 to $100,000 with rates from 7.99% to 21.24%. Funding takes five to seven business days. Wells Fargo requires a credit score of at least 640 for consideration. The bank also offers a co-signer option if your credit score is lower or your income is limited.
Citibank offers personal loans from $2,000 to $50,000 with rates from 5.99% to 19.99%. Funding typically takes five to seven business days. Citibank has stricter credit requirements than some competitors — you generally need a score of 700 or higher for the best rates.
Credit unions and member-based lending
Credit unions are member-owned cooperatives that often charge lower interest rates than banks because they do not operate for profit. Personal loan rates at credit unions typically range from 4% to 18%, depending on the union and your credit history. The tradeoff is that you must become a member first, which can take a few days to a week.
To join a credit union, you must meet membership criteria — usually living or working in a specific area, working in a certain industry, or being related to a current member. Some credit unions allow anyone to join by making a donation to a nonprofit partner. Once you are a member, you can often borrow up to $50,000 or more, and approval may take just two to three business days.
Navy Federal Credit Union serves military members, veterans, and their families. Rates on personal loans start around 7.99% and funding takes two to three business days. Connexus Credit Union is open to anyone and offers rates starting around 6.99%. Pentagon Federal Credit Union serves federal employees and military members with rates starting around 7.99%.
If you do not know which credit union to join, visit CO-OP or Alliant to search for unions in your area or that match your profession or background.
Online lenders and fintech companies
Online lenders like LendingClub, Prosper, Upstart, and SoFi fund loans faster than banks — often within 24 hours of approval. Interest rates typically range from 5.99% to 35.99%, with the wide range reflecting different risk assessments and credit profiles. Online lenders often consider factors beyond credit score, such as education or employment history, which can help borrowers with lower credit scores.
The speed comes with a cost: online lenders charge origination fees (typically 1% to 8% of the loan amount) that are deducted from your disbursement. A $10,000 loan with a 5% origination fee means you receive $9,500 and repay $10,000 plus interest. Banks also charge origination fees, but they are often lower or waived for customers with strong credit.
Online lenders typically fund loans between $1,000 and $50,000. The application process is entirely digital — you upload documents, verify your identity, and receive a decision within hours. Funding happens via bank transfer, usually the next business day.
How to compare personal loan offers
The interest rate is not the only cost that matters. When comparing offers, look at the annual percentage rate (APR), which includes the interest rate plus fees, expressed as a yearly cost. A loan with a 10% interest rate and a 5% origination fee has a higher APR than a loan with a 10.5% interest rate and no origination fee.
Request quotes from at least three lenders. Most lenders offer a soft inquiry that does not affect your credit score. A soft inquiry shows you a rate range; a hard inquiry (which does affect your score) comes when you formally request the loan. Collect the following information from each offer:
- Loan amount and term (how many months to repay)
- Interest rate and APR
- Origination fee and any other fees
- Monthly payment amount
- Total amount you will repay over the life of the loan
- Funding timeline
- Prepayment penalty (whether you can pay off early without a fee)
Use an online loan calculator to see how different terms affect your monthly payment. A $20,000 loan at 10% APR costs $211 per month over 10 years but $477 per month over 5 years. Shorter terms cost more per month but less in total interest.
What affects your interest rate and approval
Your credit score is the primary factor lenders use to set your rate. Scores above 750 typically receive rates in the 6% to 10% range. Scores between 650 and 750 receive rates between 10% and 18%. Scores below 650 may face rates above 20% or outright denial.
Lenders also look at your income and debt-to-income ratio — the percentage of your monthly income that goes to existing debt payments. If you earn $5,000 per month and already pay $1,500 toward car loans, credit cards, and other debts, your debt-to-income ratio is 30%. Most lenders want this ratio below 40% to 50%. A higher ratio signals that you are already stretched thin and may struggle to repay a new loan.
Employment history and the length of time at your current job also matter. Lenders prefer borrowers who have been employed for at least two years. A recent job change does not automatically disqualify you, but it may result in a higher rate or a smaller loan amount.
Timeline from application to funding
| Lender Type | Approval Timeline | Funding Timeline | Total Time to Cash |
|---|---|---|---|
| Online lender | Same day to 24 hours | 1 business day | 1 to 2 business days |
| National bank | 2 to 3 business days | 5 to 7 business days | 7 to 10 business days |
| Credit union (member) | 1 to 2 business days | 2 to 3 business days | 3 to 5 business days |
| Credit union (non-member) | 3 to 7 days (membership first) | 2 to 3 business days | 5 to 10 business days |
Actual timelines depend on how quickly you provide documents, whether your application is flagged for manual review, and whether the lender needs to verify employment or income. Weekends and holidays extend the timeline. If you need money within a few days, an online lender is your fastest option. If you can wait a week or two, a bank or credit union may offer a lower rate.
Red flags and what to avoid
Avoid lenders that may provide approval regardless of credit score, charge upfront fees before funding, or pressure you to decide quickly. Legitimate lenders do not charge money before the loan is disbursed. Upfront fees are a sign of a predatory lender or a scam.
Be cautious of lenders that advertise rates without mentioning APR or fees. The advertised rate is often available only to borrowers with excellent credit; your actual rate may be much higher. Always ask for the APR and total cost in writing before you commit.
If a lender contacts you unsolicited offering a loan, treat it as a potential scam. Legitimate lenders do not cold-call or email to offer loans. If you are interested in a loan, you should initiate the contact.
Frequently Asked Questions
Can I get a personal loan with a credit score below 600?
Yes, but options are limited and rates are higher. Online lenders and some credit unions work with borrowers in the 550 to 600 range, though rates may exceed 25%. A co-signer with better credit can improve your chances and lower your rate. Some lenders also offer secured personal loans, which require collateral like a savings account or vehicle, and may have lower rates than unsecured loans.
What is the difference between a personal loan and a credit card?
A personal loan is a lump sum you receive upfront and repay in fixed monthly payments over a set period, usually two to seven years. A credit card is a revolving line of credit you can borrow from repeatedly as you pay it down. Personal loans have lower interest rates for most borrowers and are better for large, one-time expenses. Credit cards are better for smaller purchases or if you need flexibility.
Do I need a bank account to get a personal loan?
Most lenders require a bank account for verification and to deposit the loan funds. Some online lenders accept alternative verification methods if you do not have a traditional bank account, but options are limited. Opening a basic checking account at a bank or credit union takes 15 to 30 minutes and is usually free.
What happens if I pay off my personal loan early?
Most personal loans have no prepayment penalty, meaning you can pay off the balance early without extra fees. Paying early saves you money on interest. However, some lenders do charge a prepayment penalty, so ask before you accept the loan. The loan agreement will state whether a penalty applies.
Should I get a personal loan or use a 401(k) loan?
A personal loan is usually better than borrowing from your 401(k). If you leave your job, a 401(k) loan must be repaid within 60 days or it becomes a taxable withdrawal with penalties. A personal loan has no such risk and does not affect your retirement savings. Interest rates on personal loans are often lower than the opportunity cost of withdrawing retirement funds early.