Where Can You Get a Personal Loan?

Personal loans are one of several borrowing options that are available to you if you need money for a large purchase or other expense.

A personal loan can be used for almost anything you want. Plus, you will generally be charged a lower rate of interest on a personal loan than you would if you charged purchases on a credit card and didn't pay the balance in full by the time the statement comes due. You'll also have a set payoff schedule with a personal loan.

If you decide that a personal loan is right for you, you'll need to apply for one and get approved for it -- you can even get pre-approved for personal loans. But where exactly can you apply? You have three primary options for personal loan lenders.

Banks

Both local banks and big national banks typically offer personal loans, although they sometimes limit eligibility to current customers (or offer their current customers more favorable terms).

One big benefit of working with a bank is that you can go talk to someone at your local branch if you need help with the loan application process. If you have your checking or savings account with the same bank, it can also be convenient to keep all of your financial accounts in one place. And some banks even give you a break on the interest rate if you're already a customer and you set up autopay.

However, banks may not offer the most competitive rates or have the easiest qualifying process so if you decide to go this route, be sure you get several quotes from not just banks, but other types of lenders as well so you can be confident you're getting a fair rate.

Credit unions

Credit unions are nonprofit organizations, unlike banks. Because of that, you can often get a better rate on a loan if you go through a credit union than a traditional bank. Many credit unions also have physical branches, so you get the same advantage of being able to deal with a person face to face that a bank would provide.

There's a downside, though. You typically have to become a member of a credit union in order to be able to get a personal loan through them. Membership rules vary, but you may need to live in a specific area, work in a specific eligible field, or pay money in order to become a credit union member.

If you are already a member of a credit union, this downside won't bother you, though. So you can check out what loan rates the credit union will offer you. You may get a reduced rate due to a loyalty discount if you also have your checking account and savings account with the credit union -- just like when you use a traditional bank.

Online lenders

Finally, there are some dedicated lenders online that offer personal loans. Sometimes, they only provide loans, but often they offer other financial services as well, such as checking accounts or investment accounts.

There are some big benefits to online lenders. For one thing, there are a lot of them catering to different kinds of borrowers. So, people with great credit may be able to find a lender offering rock-bottom rates, while those who have imperfect credit scores may be able to find a lender willing to work with them when a traditional bank might not.

There are also downsides, though. You won't get in-person customer support. And it can be harder to tell which lenders are legitimate and which are sketchy and offering unfavorable terms (although reading the fine print and looking for added fees can help). Be sure to review our list of the best personal loan lenders for further guidance.

Ultimately, your best option would be to get a rate quote for a personal loan from one or more of each of these types of lenders. Then, compare to see which is offering you the best rates and terms so you can find the loan that's right for you.