Best Credit Union Personal Loans Of 2024 (2024)

Summary: Best Credit Union Personal Loans

Company	Company - Logo	Forbes Advisor Rating	Forbes Advisor Rating - Image	Minimum credit score	APR range	Learn More CTA text	Learn more CTA below text	VIEW MORE
USAA		4.0		USAA does not disclose this information	9.94% to 18.51% with autopay	View More		View More
Alliant Credit Union		4.0		640	Rates start at As low as 11.79%	View More		View More
Navy Federal Credit Union		4.0		No requirement	8.99% to 18%	View More		View More
First Tech Federal Credit Union		3.5		Does not disclose	Rates start at 9.74%	View More		View More
PenFed		3.0		650	8.49% to 17.99%	Learn More	Via Fiona.com's Website

How a Credit Union Personal Loan Works

A personal loan from a credit unionworks like any other personal loan. You’ll borrow a fixed amount of money and repay it over a set period, with interest. Credit union personal loans often come with lower interest rates than those offered by traditional banks or online lenders.

On top of lower interest rates, credit union personal loans may also offer flexible repayment terms and lower fees, making it easier to manage your finances and pay off your loan on time.

How To Get a Personal Loan From a Credit Union

The application process for a personal loan can vary between credit unions, but you’ll generally take similar steps before you get a loan, including:

1. Evaluate your borrowing needs.Before applying for a personal loan, consider your borrowing needs. Calculate what costs you’ll need to cover with the loan so you don’t end up overborrowing, and use apersonal loan calculatorto understand how much you can afford to repay.
2. Find credit unions in your area.Start by researching credit unions in your area. Some credit unions restrict who can become a member, so evaluate each financial institution’s eligibility requirements before choosing a lender. You’ll typically need to become a member at the credit union you choose before you can apply for a loan.
3. Compare interest rates and fees.Once you narrow down your options, compare each credit union’s interest rates and fees. Look for terms that fit your budget and repayment goals. If possible, prequalify to see what interest rate and terms you’re likely to qualify for with impacting your credit score.
4. Gather documents and fill out an application.Many credit unions require information such as bank statements, tax returns and proof of income to apply for a loan. After compiling the necessary documents, complete an online or paper loan application.
5. Submit documents for review.Submit the required documentation for the loan and provide any additional documentation the credit union requests. Quickly responding to requests from your loan officer quickly can keep the borrowing process on schedule.
6. Wait for approval.When your application is complete, the credit union will review your application and make a decision.
7. Sign paperwork and receive funds.Once approved, sign the loan agreement and other necessary documents. Funding times vary, but the lender may deposit funds into your account within two business days after approval.

How Long Does It Take To Get a Personal Loan From a Credit Union?

You’ll typically receive your loan from a credit union anywhere between a few days to a few weeks, but it can depend on several factors. The credit union’s application process and requirements can impact how long it takes to get funding.

Your own credit history and financial situation can also impact how long the approval and funding process takes. If you need money quickly, research and compare various credit unions to find the best fit for your needs and timeline.

Tips for Comparing Personal Loans From Credit Unions

Credit unions often tailor their financial products to specific groups or geographic areas. However, choosing the most competitive option that meets your needs can be difficult. When you need to compare personal loans from credit unions, follow these tips:

• Compare annual percentage rates (APRs) because it consists of both the interest rate and any fees.
• Review the repayment terms for each loan to understand how much you’ll pay in interest over the life of the loan.
• Account for costs associated with the loan, such as processing fees or early repayment charges.
• Check if there are member discounts or other loyalty programs.
• Consider additional benefits like overdraft protection or rewards.
• Read customer reviews to learn about customer service and loan offerings.
• Ask questions to fully understand how the loan process works.
• Ensure you’re comfortable with the loan before committing to terms.

Credit Unions vs. Banks

Although both offer personal loans to consumers, there are keydifferences between credit unions and banks.

Because credit unions are not-for-profit, they’re less concerned about revenue than for-profit banks. As a result, credit unions typically offer loans with lower interest rates than banks. They’re also more likely to work with you if you have bad or limited credit than a traditional bank.

Credit unions are often tailored to specific groups or geographic regions and can give their members unique benefits, such as loyalty programs or one-on-one financial counseling. They can also offer more personalized service than banks.

Traditional banksoften offer a more comprehensive range of products and services than credit unions and typically have more physical branches and ATM locations. Banks can also have more robust and user-friendly mobile banking options, including mobile apps, whereas credit unions often lack this functionality.

Credit unions can be a great option if you want access to competitive interest rates, need flexible repayment terms or want a more personalized experience. Depending on the financial institution, banks may offer higher loan amounts and may be a better option if you want access to more banking tools and resources.

Alternatives to Credit Union Personal Loans

If you aren’t eligible for a personal loan from a credit union, there are other options available. Whether you consider a traditional bank loan or payday loan, it’s essential to understand each option thoroughly before taking the debt on.

Traditional Term Loans

A traditional bank term loan is a fixed-rate loan typically offered by commercial banks or large financial institutions. Thebest personal loanstypically have repayment terms comparable to those available from credit unions (up to seven years) and are unsecured.

That said, some traditional loans come with higher interest rates than credit union personal loans—generally between 4% and 36%—and more fees. Consider a bank loan over a credit union loan if you need higher borrowing limits or otherwise prefer a more traditional borrowing experience.

Online Personal Loans

An online personal loan is similar to a traditional personal loan, except the lender handles the application and funding processes digitally. Online lenders often have more flexible qualification standards, and they can typically disburse loan funds quicklier than a credit union.

If you need fast access to cash with minimal hassle, an online personal loan may be the best option. However, a credit union personal loan is often better if you prefer a more personal touch and the ability to establish a relationship with a lender.

Home Equity Loans or HELOCs

Home equity loans and home equity lines of credit (HELOCs) are two ways to borrow money by accessing the equity in your home. Ahome equity loanis a lump sum of money borrowed against the equity in your home; aHELOCis a line of credit that allows you to borrow against your home equity as needed, up to a certain amount.

Both of these loan options are secured by your home, which means if you fail to repay the loan, the lender can take possession of your house. That also means they often have lower interest rates than a personal loan from a credit union.

These options are best if you have significant home equity and need access to a large sum of money for expenses like home improvements, medical bills ordebt consolidation. If you’re concerned about your ability to repay these loans over the entire term or you don’t own a home, a personal loan from a credit union might be a better option.

Credit Cards

Credit cards provide you with revolving credit, allowing you to borrow money up to a set limit and pay it back with interest. While somecredit cardscome with higher APRs than credit union personal loans—usually between 15% and 30%—some offer 0% introductory APRs for six to 20 months, or longer, for highly qualified applicants. Many credit card companies also offer credit cardcash advances, though these can come with large fees.

A credit card can be helpful if you need to borrow money for short-term expenses or everyday purchases. For a large sum of money, though, a personal loan from a credit union might be better due to lower interest rates and longer repayment terms.

Payday Loans

Payday loansare short-term loans that typically have fees that are equivalent to APRs as high as 400%. Since they can be expensive to repay, borrowers risk getting caught in a cycle of debt where they need to borrow more money to cover the initial debt.

Payday loans are a risky option, so before you take on this debt, have a plan to repay the loan and make sure you’re aware of the interest and fees that come along with it. Credit unions offer personal loans with much lower interest rates and longer repayment terms, making them a more stable and reliable option.

Car Title Loans

A cartitle loaninvolves using the title of your vehicle as collateral for the loan. That means if you fail to repay a car title loan, the lender can then take possession of your car.

The money you can borrow typically ranges from a few hundred to a few thousand dollars, and the loan terms are usually around 30 days. While car title loans might seem like a quick and easy solution for getting the cash you need, they come with high-interest rates and fees that can make it difficult to repay the loan on time.

In contrast, credit unions offer personal loans with lower interest rates and longer repayment, making them a better option for most borrowers.

Methodology

We reviewed popular lenders based on 16 data points in the categories of loan details, loan costs, eligibility and accessibility, customer experience and the application process. We chose the best lenders based on the weighting assigned to each category:

• Loan cost.35%
• Loan details.20%
• Eligibility and accessibility.20%
• Customer experience.15%
• Application process.10%

Within each major category, we also considered several characteristics, including available loan amounts, repayment terms, APR ranges and applicable fees. We also looked at minimum credit score requirements, whether each lender accepts co-signers or joint applications and the geographic availability of the lender. Finally, we evaluated each provider’s customer support tools, borrower perks and features that simplify the borrowing process—like prequalification options and mobile apps.

Where appropriate, we awarded partial points depending on how well a lender met each criterion.

To learn more about how Forbes Advisor rates lenders, and our editorial process, check out our.

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