Best Banks for Personal Loans

When you need a personal loan, the instinct is to start where you already do your banking. That’s not wrong. Your bank already knows you, and that relationship can work in your favor. The catch is that not every bank offers personal loans or the best terms.

Whether your bank is the right fit depends on three things: your status as a customer, your credit score, and how much you need to borrow. Those factors determine your options.

The best move before you apply anywhere is to pre-qualify with two or three lenders. It’s free, it takes minutes, and it typically won’t touch your credit score (confirm with each lender that they can prequalify you with a soft credit pull). The framework below makes that comparison fast.

What makes a bank a good fit for a personal loan?

With personal loans, all banks are not equal, and the same bank won’t be right for everyone. Three variables matter most.

The first is whether you’re an existing customer. Banks commonly extend better terms to people who already bank with them and meet certain guidelines. Wells Fargo offers a 0.25% relationship discount to customers with a qualifying checking account and autopay. U.S. Bank may offer same-day funding to existing checking customers. Those perks can tip the math in your favor, but only when you already have the relationship.

The second variable is your credit profile. Traditional banks tend to hold borrowers to stricter credit standards than digital finance companies. 

FICO’s Good tier runs from 670 to 739; Very Good starts at 740. Those ranges are where bank approval tends to be reliable. Big banks commonly treat loans with sub-620 scores as high-risk. If you get approved with a score under 620, expect to pay higher rates.

The third variable is loan size. Some banks cap personal loans at $25,000 to $35,000 for non-customers. Others lend up to $100,000. Match the bank to your borrowing needs before applying.

Most personal loans are unsecured, but secured options exist. If your credit file is thin and a bank offers a secured option, that’s worth knowing.

Banks vs. credit unions vs. online lenders

Banks are the familiar starting point for most borrowers. They normally require good to excellent credit, offer relationship perks to existing customers, and have in-person service for those who want it. Funding times vary by lender—often within a week of approval.

Credit unions are member-owned nonprofits that routinely offer cheaper financing to their members. Membership used to be restrictive, but most credit unions now open their doors broadly. Many federal credit unions accept members from anywhere in the country. Loan limits tend to run lower than at larger banks. For a borrower with fair to good credit, the rate difference can be significant.

Online lenders often move faster and accept a wider range of credit profiles than traditional banks. Loan limits can be higher, in the six figures for qualified borrowers. Online personal loan origination fees range from 0% to 12% of the loan amount. When charged, the fee is deducted from the loan before you receive the money. If you need a specific loan amount, borrow enough to cover the fees and deliver the money you need. Origination fees don’t always appear in the advertised rate, so compare loan APRs.

One filter applies across all three channels: the National Consumer Law Center (NCLC) recommends a 36% APR ceiling, including all fees, as the benchmark for affordable lending—the same cap the Military Lending Act applies to active-duty servicemembers. Loans above 36% APR are widely considered predatory by consumer-protection groups. Any lender above that mark is worth skipping.

Learn more about where to get a personal loan.

Banks that offer personal loans and what sets them apart

Here’s how some banks and bank-affiliated lenders break down by scenario.

A few scenarios worth highlighting:

• If you need a large loan, SoFi, LightStream, and Wells Fargo all lend up to $100,000. Most banks set lower maximums, so if your project is substantial, those three are worth a pre-qualification check.
• If you want no origination fee, SoFi (on SoFi Bank–originated loans), LightStream, Wells Fargo, and Discover all charge none. Comparing rates is straightforward when fees aren’t in the mix.
• If you want to apply with a co-borrower, most big banks don’t allow it. LendingClub, Prosper, and Achieve all allow co-borrowers, though only LendingClub appears in the table above. Adding a second borrower with stronger credit can improve your rate or approval odds.
• If you’re borrowing a smaller amount, TD Bank, Avant, and Discover all start at or near $2,000 and serve borrowers across a range of credit profiles.

For a broader market view, browse our best personal loan companies.

How to qualify for a personal loan at a bank

Lenders assess ability to repay using credit score, credit history, annual income, employment status, and debt-to-income (DTI) ratio. Some fintech lenders also weigh education and employment data alongside credit.

Credit score carries the most weight at traditional banks. FICO’s Good range is 670 to 739; Very Good is 740 to 799. Banks regularly approve borrowers in both ranges. Scores below 620 are broadly treated as higher risk. Options still exist, but rates are higher and traditional banks are often the wrong starting point.

Your DTI ratio matters too. That’s your monthly housing and debt payments divided by your gross (before tax) monthly income. Lenders use it to confirm you can afford a new payment. Each lender sets its own threshold; no universal cutoff applies to personal loans.

Before applying anywhere, check your credit report. AnnualCreditReport.com is the only federally authorized source for free credit reports, and you can check your scores for free with Experian and Equifax. Errors can suppress your score, so dispute anything that looks wrong before submitting an application.

When you’re ready to shop, start with pre-qualification. Pre-qualification typically creates a soft credit inquiry (ask each lender to confirm). Soft inquiries don’t affect your credit score, and pre-qualification is not a guarantee of final approval. Most lenders offer it. You’ll see estimated rates and terms for your profile without a hard pull on your credit.

If your score falls below a bank’s threshold, our personal loans for bad credit page covers lenders with broader eligibility.

When your own bank is—and isn’t—the best choice

Your bank is a solid starting point when:

• You have an existing checking or savings account there. Relationship perks are real. Wells Fargo’s 0.25% discount and U.S. Bank’s potential same-day funding both require that existing tie. Without the account, you’re just another applicant.
• Your credit score is in the Good to Very Good range. A FICO Score above 670 puts you in the range banks work with regularly.
• You value in-person service. Banks offer that; most online lenders don’t.

Your bank isn’t the right fit when:

• Your bank doesn’t offer personal loans. This is more common than people expect. 
• You need more than your bank allows for new customers. Some banks cap personal loans at $25,000 for borrowers without existing accounts.
• Your credit is below 620. Banks tend to be less flexible than fintechs here. A credit union or a broader-eligibility online lender is worth trying first.
• You need money faster than your bank typically funds. Online lenders often move quicker.
• You’re ineligible entirely. American Express personal loans, for example, require an active Amex Consumer Card. If you don’t have one, that option isn’t on the table.

Pre-qualifying clears it up fast. Apply to your bank and one or two others, compare the numbers, and go with the best offer.

Bills Action Plan

1. Pull your free credit report at AnnualCreditReport.com and check your scores with Experian or Equifax before applying. Review all three reports for errors and dispute anything that looks wrong.
2. Check whether your current bank offers personal loans and whether you’re eligible for a relationship discount or larger loan limit as an existing customer.
3. Pre-qualify with two or three lenders, including your bank and at least one online lender or credit union. Pre-qualification generates a soft inquiry and won’t affect your credit score.
4. Compare APRs, not just interest rates. APR includes fees and gives you the true cost-comparison number. For an accurate APR comparison, you must evaluate loans with the same terms (years).

Key Terms

APR (annual percentage rate): The total yearly cost of borrowing, including the interest rate plus most lender fees. It’s the right number to compare loans with different rate and fee structures. 

Pre-qualification: A soft credit check that shows you estimated loan terms without affecting your credit score. It’s not a guarantee of final approval.

Origination fee: A one-time fee some lenders charge to process a loan. It’s deducted from the loan amount before you receive the money. Personal loan origination fees commonly range from 0% to 12%.

DTI (debt-to-income ratio): Your monthly debt payments plus housing divided by your gross monthly income. Lenders use it to evaluate your ability to handle a new loan payment.

For general information only. Bills.com is not a lender and does not make credit decisions. Loan availability, rates, and terms vary by lender and are subject to credit approval.