Personal loans allow you to borrow a large sum of money all at once, at a fixed interest rate that keeps your payments consistent and predictable. But some banks and some personal loans are better than others. Take a look below to find out the best banks for personal loans.
Best Banks for Personal Loans
Because personal loans are unsecured loans, they do not require any collateral to access funds, which makes them a more favorable loan option than a home equity loan or line of credit if you need to borrow some major cash. However, because there is no collateral, personal loan interest rates are often higher, and getting approved relies solely on your creditworthiness.
But not all personal loans are created equal, which is why it’s important to shop around when sorting through potential lenders. Some personal loans have limited loan amounts and sky-high interest rates. Others have hidden fees that make the loan more expensive than the rate suggests.
Here’s a look at the best banks for personal loans.
|Bank||APR||Loan Duration||Loan Amount|
|Discover Bank, Member FDIC||7.99%-24.99%||36-84 months||Up to $40,000|
|TD Bank||8.99%-23.99%||36-60 months||$2,000-$50,000|
|U.S. Bank||8.24%-24.99%||12-84 months||$1,000-$25,000 ($50,000 for current U.S. Bank customers)|
|Wells Fargo||8.49%-24.49%||12-84 months||$3,000-$100,000|
- APR: 10.49%-19.49%
- Loan Amount: $2,000-$30,000
- Terms: 12-60 months
To qualify for the Citi personal loan, you must already be a Citi customer. The loan processing is quick and easy — receive your funds the same day into a Citi deposit account, or within two business days if the funds are direct deposited into a non-Citi account. Plus, you can get a rate discount of 0.50% APR when you opt for automatic payments at the time your loan is originated. Current Citigold® and Citi Priority customers receive a 0.25% APR discount. Defaulting on your payments increases your rate by 2%, but there are no origination fees, late fees or prepayment penalties.
- APR: 7.99%-24.99%
- Loan Amount: Up to $40,000
- Terms: 36-84 months
With the Discover® personal loan, there are no hidden fees. In addition, Discover can send funds directly to your creditors or direct deposit them into any of your bank accounts as soon as one business day after acceptance, according to the bank’s website. Checking your rate has no impact on your credit score.
- APR: 8.74%-17.39%
- Loan Amount: $3,500-$100,000
- Terms: 24-60 months
Truist makes quick credit decisions and can fund your personal loan on the same day if you work with a loan officer to submit the necessary documents and expedite the process. And there are no origination fees. Truist also offers personal lines of credit.
- APR: 8.99%-23.99%
- Loan Amount: $2,000-$50,000
- Terms: 36-60 months
The TD Bank personal loan comes with a fixed interest rate and no application or origination fees. You can check your loan options with no effect on your credit unless you decide to move forward with the loan. If you’re approved, you could get your funds within one business day via direct deposit.
- APR: 8.24%-24.99%
- Loan Amount: $1,000-$25,000 ($50,000 for current U.S. Bank customers)
- Terms: 12-84 months
Although U.S. Bank’s fixed APR is 8.24% for loan amounts of $10,000 or more, higher rates apply for credit scores below 800 or for other loan amounts and terms. The minimum loan amount is $1,000. Qualified U.S. Bank customers can apply for a loan of up to $50,000 — and if your credit score is at least 660 and you meet other qualifying factors, you could receive your funds the same day. Non-U.S. Bank customers with a credit score of 720 or higher can apply for up to $25,000.
- APR: 8.49%-24.49%
- Loan Amount: $3,000-$100,000
- Terms: 12-84 months
Wells Fargo personal loans come with a simple online application and funding process. Once you’re approved, you can get your loan amount by the next business day at the earliest. Also, there is no origination fee or prepayment penalty. Customers who have a qualifying Wells Fargo consumer checking account and make automatic payments from a Wells Fargo deposit account qualify for a 0.25% relationship discount.
Is a Personal Loan the Right Choice for You?
Whether a personal loan makes sense for you depends on how you want to use it. It’s a good choice for consolidating high-interest credit-card debt or financing an emergency expense such as medical treatment or major home or auto repair. If you have good or excellent credit, you could get a much lower rate than you would with a credit card, and because it’s unsecured, a personal loan doesn’t put your home at risk like a home equity loan does.
While you can use a personal loan for nearly anything you want, lenders do impose a few restrictions. They don’t allow personal loans to be used for the following:
- Educational expenses and student loan repayment
- Business expenses
- Consolidating other debt from the same lender
- Down payment on a home you plan to finance
Lenders consider other uses, such as a wedding or a big vacation, to be acceptable uses for a personal loan. However, it’s important to weigh the benefits against loan fees and the interest you’ll pay over the life of the loan.
For recurring expenses such as home remodeling projects to increase the value of your home, consider an unsecured personal line of credit. A line of credit has many of the same benefits as a personal loan, but you borrow only what you need at any given time, and you can reuse your credit by paying down your balance.
Taylor Bell contributed to the reporting for this article.
Data was compiled on Nov. 2, 2023, and is subject to change.
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