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Benefits of getting a personal loan from a bank

Learn 7 distinct benefits of getting a personal loan at a bank rather than using an online lender when it comes to rates, fees and service.
Benefits of getting a personal loan from a bank

Shopping for a personal loan can involve comparing offers from multiple lenders, including both banks and online lenders.

While factors like APR (Annual Percentage Rate), fees, repayment terms, and customer service remain crucial regardless of the lender, opting for a personal loan from a bank can offer distinct benefits.

BENEFITS

Personal loans from our partners

Est. APR

6.70 - 35.99%

Loan Amount

$1K - $75K

Min. Credit Score

None

Loan Terms

3 to 5 years

Upstart personal loans are best fit for borrowers with fair to excellent credit—including those with limited credit history—who want fast, unsecured funding for a variety of needs and appreciate a tech-driven application process that considers more than just credit scores. Upstart may charge an origination fee of up to 12% of the loan amount, depending on your state of residence.

Est. APR

7.99 - 35.99%

Loan Amount

$1K - $50K

Min. Credit Score

600

Loan Terms

2 to 7 years

Upgrade personal loans are best fit for individuals with good to excellent credit who want fast, fixed-rate funding for debt consolidation, home improvements, or major purchases, while benefiting from a simple online application and transparent terms, including a high origination fee that ranges from 1.85% to 9.99%.

Est. APR

11.69 - 35.99%

Loan Amount

$1K - $50K

Min. Credit Score

None

Loan Terms

3 to 5 years

Universal personal loans are the best fit for individuals with bad to fair credit seeking fast, fixed-rate funding up to $50,000 with simple online approval, flexible payoff options, and no prepayment fee. Expect a loan origination fee ranging from 5.25% to 9.99% of the loan amount, which will be deducted upfront from the loan proceeds.

7 Benefits of Getting a Personal Loan from a Bank

1. Stability and reliability of the lender

Banks are well-established financial institutions with a long history of providing loans to consumers, and they typically have a more streamlined and efficient application process than other lenders like simple signature loans.

2. Perceived sense of security

Some borrowers may feel more comfortable working with a traditional financial institution like a bank, which they perceive as more established and trustworthy.

Banks are heavily regulated and must adhere to strict lending standards, which can provide the borrower with a greater level of confidence in the lender and the loan process.

This can be particularly important for larger loan amounts or for borrowers who are seeking a more traditional and reliable lending experience.

3. In-person customer service

If you prefer face-to-face interactions or need help during the application or repayment process, banks can provide personalized assistance at a branch.

4. Additional perks or discounts

Some banks may offer special benefits to their existing customers, such as rate discounts or waived fees, when they apply for personal loans.

5. Access to other financial products

Getting a personal loan from your bank can make it easier to manage your finances in one place and may qualify you for other banking products or services.

6. Potential for lower interest rates

Banks often have access to lower wholesale interest rates, which they can pass on to their customers. This can result in a lower overall cost of borrowing for the borrower. 

Additionally, banks may be more willing to offer competitive rates to borrowers with good credit histories and strong financial profiles.

7. More flexible repayment terms

Banks tend to have more flexible terms where borrowers can often choose from a range of repayment schedules, from short-term to long-term, depending on their financial needs and preferences.

This can make it easier to fit the loan payments into the borrower's budget and ensure that they can make their payments on time.

Factors to consider before applying for a personal loan

Before applying for a personal loan, it's important to carefully consider a number of factors including:

  • Credit scores. Your credit score will largely determine the interest rate and loan terms that you are offered, so it's important to know your credit score and work on improving it if necessary.
  • Purpose of the loan. Personal loans can be used for a wide range of purposes, from debt consolidation to home renovations to unexpected expenses. It's important to carefully consider the reason for the loan and whether it aligns with your financial goals and priorities. 
  • Loan amount. It's important to borrow only what you need and to ensure that the monthly payments are affordable within your budget. Lenders will typically have a maximum loan amount that they are willing to offer, based on your income, credit score, and other financial factors.
  • Repayment terms. It's important to carefully review the repayment terms, including the interest rate, loan length, and any fees or penalties, to ensure that you are comfortable with the overall cost of the loan.
  • Impact of the loan on your overall financial health. Taking on a personal loan can have both short-term and long-term implications, so it's important to carefully review your current debt load, savings, and other financial obligations to ensure that the loan fits within your overall financial plan.

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Best online savings rates

The national savings rate is 0.38% APY. This online bank pays way more.

CIT Bank

SAVINGS CONNECT ACCOUNT
3.90% APY
/Month
Minimum $100 balance
No maintenance fees
Mobile & Online Banking
Member FDIC

Upgrade

PREMIER SAVINGS
4.02% APY
/Month
Minimum $1,000 balance
No maintenance fees
Mobile & Online Banking
Deposits are FDIC insured

Quontic Bank

HIGH-YIELD SAVINGS
3.85% APY
/Month
Minimum $100 balance
No maintenance fees
Mobile & Online Banking
Deposits are FDIC insured
Disclaimer: Our goal is to provide the most relevant and current information. However, the information is for informational purposes only and is not intended to be personal financial advice.

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