Most banks offer personal loans, but the terms, rates, and speed vary widely

Nearly every bank in the United States offers personal loans, but what you actually get depends on which bank you choose, your credit history, and how much you borrow. A personal loan from a large national bank like Chase or Bank of America works differently from one at a credit union or an online lender — the approval timeline, interest rate, and fees are not the same. This guide walks you through the main types of lenders, what each one typically offers, and how to compare them before you commit.

Key Takeaways

  • National banks, regional banks, credit unions, and online lenders all offer personal loans, and each charges different interest rates and fees based on your credit score and income.
  • Banks you already have a checking or savings account with often approve faster and may offer better rates to existing customers.
  • Credit unions typically charge lower interest rates and fees than national banks, but you must be a member to borrow.
  • Online lenders approve and fund loans quickly — sometimes within one business day — but often charge higher interest rates than traditional banks.
  • Comparing offers from at least three lenders takes a few hours and can save you hundreds of dollars in interest over the life of the loan.

National banks and what they charge

Large national banks like Chase, Bank of America, Wells Fargo, and Citibank offer personal loans to customers with good to excellent credit. Interest rates at these banks typically range from around 7% to 36%, depending on your credit score, income, and the loan amount. The exact rate you receive is not set in advance — the bank pulls your credit report and makes an offer based on what it finds.

National banks usually require a credit score of 620 or higher to be considered, though the best rates go to borrowers with scores above 700. Loan amounts range from $1,000 to $50,000 or more, and repayment terms typically run from 24 to 84 months. If you already have a checking account at the bank, approval is often faster — sometimes within one to three business days — because the bank already has your financial history on file.

The downside is that national banks charge origination fees (usually 1% to 8% of the loan amount) and may charge prepayment penalties if you pay off the loan early. Some also charge late fees if you miss a payment. Before you accept an offer, ask the bank for the full fee schedule and the annual percentage rate (APR), which includes both interest and fees.

Credit unions and lower rates

Credit unions are member-owned financial institutions that often charge lower interest rates and fewer fees than national banks. Personal loan rates at credit unions typically range from 6% to 18%, and many do not charge origination fees at all. If you are a member of a credit union, this is usually the cheapest place to borrow.

The catch is that you must be a member to borrow. Membership requirements vary — some credit unions are open to anyone who lives or works in a certain area, while others are limited to employees of a specific company or members of a particular organization. If you are not already a member, you may be able to join, though it usually requires opening a savings account with a small deposit (often $25 or less).

Credit unions also tend to be more flexible with borrowers who have lower credit scores or irregular income. If a national bank turns you down, a credit union may still work with you. To find a credit union you can join, search the CO-OP Network or the Alliant Credit Union locator online, or ask your employer whether it sponsors a credit union.

Online lenders and fast funding

Online lenders like LendingClub, Prosper, Upstart, and SoFi operate entirely through websites and apps. They approve loans quickly — often within hours — and can fund your account within one business day. This speed makes them useful if you need money fast, though it comes at a cost.

Interest rates at online lenders vary widely based on your credit score and the lender's own model. Rates typically range from 6% to 36%, and some lenders charge origination fees of 1% to 12%. Online lenders are more willing to work with borrowers who have fair credit (scores in the 580 to 669 range), which can make them a good option if traditional banks have turned you down.

The trade-off is that online lenders often charge higher rates than credit unions and sometimes higher than national banks. Before you choose an online lender, compare the APR and total fees across at least two or three options. Some online lenders also charge prepayment penalties, so read the terms carefully.

Regional and community banks

Regional banks like Truist, PNC, and U.S. Bank, as well as smaller community banks, fall between national banks and credit unions in terms of rates and flexibility. Interest rates typically range from 7% to 28%, and origination fees are usually 1% to 6%. If you have a relationship with a regional or community bank — a checking account, savings account, or mortgage — you may receive a better rate than a new customer would.

These banks often move faster than large national banks and may be more willing to consider factors beyond your credit score, such as your employment history or savings. Because they are smaller, you may also get more personalized service. The downside is that their loan amounts and terms may be more limited than what a national bank offers.

How to compare offers before you decide

The best way to find the lowest rate is to get offers from at least three different lenders. When you request a quote, the lender will perform a "soft" credit pull that does not hurt your credit score. You can do this with multiple lenders within a short window (usually 14 to 45 days, depending on the type of loan) without additional damage to your score.

When you compare offers, look at the APR, not just the interest rate. The APR includes both the interest rate and all fees, so it gives you a true picture of what the loan will cost. Also compare the loan term (how many months you have to repay) and any fees for paying early. A loan with a lower interest rate but a longer term might cost more in total interest than a loan with a slightly higher rate and a shorter term.

Create a simple spreadsheet with the lender name, APR, loan amount, term, origination fee, and total interest you will pay over the life of the loan. This makes it easy to see which offer is actually the cheapest. Do not choose based on speed alone — a loan that funds in one day but costs thousands more in interest is not a good deal.

What happens after you are approved

Once you accept an offer, the lender will ask you to sign loan documents electronically or in person. The lender then verifies your employment and income (usually by contacting your employer or reviewing recent pay stubs) and performs a final credit check. This process typically takes three to five business days.

After verification is complete, the lender funds the loan by depositing money into your bank account. National banks and credit unions usually take three to five business days to fund. Online lenders often fund within one business day, sometimes the same day you sign. Once the money is in your account, you can use it for whatever you need — there are no restrictions on how you spend a personal loan.

Your first payment is usually due 30 days after funding. The lender will send you a payment schedule showing exactly when each payment is due and how much principal and interest each payment covers. You can usually set up automatic payments from your bank account to make sure you do not miss a due date.

Frequently Asked Questions

Do I need a credit score of 700 to get a personal loan?

No. While national banks prefer scores above 700, credit unions and online lenders work with borrowers who have scores as low as 580. Your rate will be higher with a lower score, but you can still borrow. If you have been turned down, try a credit union or an online lender that specializes in fair-credit borrowers.

What is the difference between a personal loan and a credit card?

A personal loan gives you a fixed amount of money upfront, which you repay in equal monthly payments over a set period (usually 24 to 84 months). A credit card gives you a line of credit you can draw from repeatedly, and you pay interest only on what you use. Personal loans have lower interest rates but less flexibility; credit cards have higher rates but more control over how much you borrow.

Can I get a personal loan if I am self-employed?

Yes, but you will need to provide more documentation. Most lenders ask for two years of tax returns and bank statements showing your income. Credit unions and some online lenders are more flexible with self-employed borrowers than national banks are. Be prepared to show consistent income over time.

What if I have bad credit or no credit history?

Credit unions and online lenders that focus on fair-credit borrowers are your best options. You may also consider a secured personal loan, where you put down collateral (like a savings account or car) to back the loan. Rates will be higher, but you have a better chance of being approved. Some lenders also let you add a co-signer with better credit to strengthen your application.

How long does it take to get approved for a personal loan?

Online lenders can approve you within hours and fund within one business day. National banks and credit unions typically take three to five business days from application to funding. The exact timeline depends on how quickly you provide documentation and whether the lender needs to verify your employment or income.