Where can I get a personal loan?

Learn whether a bank, credit union, or finance company is better for your situation.

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By Jessica Walrack

Written by

Jessica Walrack

Freelance writer

Jessica Walrack is an experienced freelance writer who has spent more than 11 years in personal finance, with expertise on loans, insurance, banking, mortgages, credit cards, budgeting, and taxes. Her work has been published by CNN, CBS MoneyWatch, U.S. News & World Report, and USA Today.

Updated September 26, 2024, 3:42 PM EDT

Edited by Meredith Mangan

Written by

Meredith Mangan

Senior editor, Fox Money

Meredith Mangan is a senior editor at Fox Money and expert on personal loans.

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Personal loans are generally available from banks, credit unions, and online lenders, but banks represent the largest originator of personal loans across the spectrum, with 48% of the market share in 2023. Personal loans can be used for things like debt consolidation to pay off credit card debt or home renovations. Here are the four types of lenders that are issuing the bulk of personal loans in the U.S.

Personal loan market share
Median borrower Equifax score
Median balance per account
Median account monthly payment
Fintech
14% (Fintech balances are reflected across sectors)
670
$4,256
$196
Banks
48%
741
$8,348
$293
Credit unions
28%
714
$4,966
$221
Personal loan finance companies
15%
610
$2,905
$169
*Data was taken from An Overview of Personal Loans in the U.S., published in 2023 as part of the Federal Reserve’s Finance and Economic Discussion Series.

Fintech personal loan lenders

Best for fast loans for fair and good credit

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Pros

  • Easy and fast online applications
  • Many fintech lenders to choose from
  • More lenient eligibility requirements than banks
  • Offer loans to underserved near-prime and low-prime borrowers
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Cons

  • Loan APRs can be high if you have fair or bad credit
  • Origination fees may apply
  • Lack of physical branches and in-person service with many online lenders

Personal loan market share: 14% (Fintech balances are reflected across sectors) Median borrower Equifax score: 670 Median balance per account: $4,256 Median account monthly payment: $196

Fintech lenders, also referred to as online lenders or non-bank alternative lenders, are a type of financial institution that use digital technology to issue loans through mobile apps and websites. For example, Best Egg, Prosper, Upstart, and Avant are some of the leading fintech lenders in the market.

These companies are able to preempt state-level interest rate ceilings when partnering with specialist banks, which can make lending to high-risk consumers feasible in states where it might not be otherwise (due to low interest rate ceilings). Most fintechs partner with banks located in states with high rate ceilings, notably WebBank and Cross River Bank. The banks become the originating lender, allowing the fintech company to charge higher rates to borrowers in states with lower interest rate limits. Then, down the line, the banks sell the loans back to the fintech companies.

The result of this little dance? Fintech lenders can offer a fast and convenient way to get a personal loan online. Further, they are able to offer loans for fair credit and bad credit when non-bank lenders can't, and offer more flexible eligibility requirements than banks or credit unions.

Compare personal loan rates

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Banks

Best for borrowers with excellent credit

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Pros

  • High loan amounts
  • Widely available
  • In-person customer service
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Cons

  • Stricter eligibility requirements
  • Typically higher costs than credit unions and some fintech lenders
  • May require you to be a customer

Personal loan market share: 48% Median borrower Equifax score: 741 Median balance per account: $8,348 Median account monthly payment: $293

Banks are for-profit corporations that offer deposit accounts such as savings and checking accounts to hold consumer funds, provide financial services, and make loans. They can take the form of large national operations, like Wells Fargo, Bank of America, Chase, and Capital One, as well as smaller community or regional organizations.

While not all banks offer personal loans, many do. In 2022, banks issued 48% of the personal loans in the U.S. - more than any other type of institution. They also have a significantly higher median balance per account than any other lender type. On the downside, banks may charge higher borrowing costs on average, and generally require higher credit scores than other lender types.

Banks that offer personal loans

Fox Business does not make or arrange loans.

Credit unions

Best for competitive rates if you can qualify for membership

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Pros

  • Widely available
  • Low interest rates and fees
  • May earn dividends with membership
  • More lenient credit requirements than banks
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Cons

  • Membership is required and may be limited
  • Less lenient credit requirements than some non-bank lenders

Personal loan market share: 28% Median borrower Equifax score: 714 Median balance per account: $4,966 Median account monthly payment: $221

Credit unions are member-owned, nonprofit cooperatives that accept deposits, make loans, and pay out their earnings to members. They also typically offer checking and savings accounts like banks. Because credit unions are nonprofit organizations and require borrowers to be members/shareholders, they often offer competitive annual percentage rates (APRs) — which include the interest rate and any upfront fees — and more lenient eligibility requirements than banks, which means your loan application may be more likely to be approved even with less-than-good-credit.

If you can't qualify for a personal loan based on your creditworthiness, credit unions provide other loan options. For example, credit unions offer payday alternative loans (PALs), which are designed as low-cost options for borrowers who would struggle to qualify for a traditional personal loan.

On the downside, a credit union membership may only be available to people in certain areas or with certain affiliations.

Credit unions that offer personal loans

Personal loan finance companies

Best for bad credit once you've exhausted other options

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Pros

  • More lenient credit score requirements
  • Applying can be easy and fast
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Cons

  • Low average loan amounts
  • High borrowing costs in some states
  • State limits may prevent borrowers from qualifying

Personal loan market share: 15% Median borrower Equifax score: 610 Median balance per account: $2,905 Median account monthly payment: $169

Personal loan financial companies are non-bank lenders that provide loans directly to borrowers, often online. Fintech lenders fall into this category when they don't partner with banks to originate loans.

As non-bank lenders, financial companies must abide by state laws limiting loan amounts, rates, fees, and terms. While they were traditionally the main source of personal loans for higher-risk borrowers, fintech lenders working around the limits have been moving in on the market.

That said, it's worth noting that personal loan finance companies approve borrowers with a much lower median Equifax risk score than any other lender type. On the downside, they also have the lowest median loan balance per account, and fees can be high. Payday loans, for example, fall in this category.

Where can I get a personal loan with bad credit?

If you need a personal loan with bad credit, your best bet will be a personal loan from a personal loan finance company, if you can qualify. Some lenders, like OneMain Financial, don't have a credit score minimum and allow you to apply with a cosigner or secure your loan with an asset to help qualify or lower your rate.

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Tip

To find a personal loan for bad credit or fair credit, look for direct personal loan lenders with a minimum credit score requirement below yours.

It's helpful to prequalify with at least three to five lenders you think might be a good fit and compare rates and terms to find the best deal available to you. Prequalification won't impact your credit, but your score may dip temporarily once you formally apply for a loan.

Personal loans for bad credit

Fox Business does not make or arrange loans.

Where can I get a personal loan FAQ

How much of a personal loan can I get?

The amount you can borrow through a personal loan will depend on a variety of factors including your credit, income amount, current debt, loan purpose, and the lender you choose. The best way to find out what you can get is to request quotes by prequalifying with several lenders.

How to qualify for a personal loan

You can find out if you prequalify for a personal loan with a lender by requesting a quote, but you won't know for sure until you go through the full application process. Generally, you'll need a credit score and annual income above the lender's minimum requirements (varies by lender), as a debt-to-income ratio (DTI) below the lender's maximum (a DTI below 36% is ideal), and sufficient income to make payments.

How long does it take to get a personal loan?

You can often get a personal loan within one to three business days if you don't run into any hang-ups. However, the application, approval, and origination processes can vary, so it's best to check with the lenders you're considering. Lenders often advertise their average funding times or share estimated funding time frames on their websites - some can even send money the same day you apply.

Meet the contributor:
Jessica Walrack
Jessica Walrack

Jessica Walrack is an experienced freelance writer who has spent more than 11 years in personal finance, with expertise on loans, insurance, banking, mortgages, credit cards, budgeting, and taxes. Her work has been published by CNN, CBS MoneyWatch, U.S. News & World Report, and USA Today.

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Fox Money is a property of Credible Operations, Inc., which is majority-owned indirectly by Fox Corporation. This material may not be published, broadcast, rewritten, or redistributed. All rights reserved. Use of this website (including any and all parts and components) constitutes your acceptance of Fox's Terms of Use and Updated Privacy Policy | Your Privacy Choices.