Personal loans are one of America’s favorite lending products. They’re offered by a range of different lenders across the country. This type of loan is one of the original types of finance offered by lenders in modern history. If you’re old enough to borrow money, there’s a high chance that you have heard of personal loans.

Personal loans come in a range of different sizes – they can be used for a variety of different purposes. Many people use them for large purchase or refinancing opportunities. But sometimes you don’t need tens of thousands of dollars. In this case, you might want to get a small personal loan.

Personal Bank Loans

This guide is a comprehensive explanation of personal bank loans and their associated benefits. It will also discuss the drawbacks associated with this form of loan, as well as the potential ramifications of obtaining one. Make sure to read through the entire article before you decide to proceed with any additional research – it is sure to answer any questions you may currently have about this lending product.

What Are Personal Bank Loans For?

Personal banks loans are simply personal loans that are distributed by banks. They provide their borrowers with capital they need for a variety of different costs. The difference between a personal bank loan and other forms of personal loans really comes down to the source. You can get personal loans from a variety of different lenders, but the general concept of the loan is pretty much the same.

We will explore personal banks loans and what they can do for you and your family in more detail below.


If you need to purchase a car or other essential item that you cannot afford to pay for upfront, personal bank loans are typically the type of loan that you will aim to acquire. You should make sure that you need the item that you are purchasing, we do not advise that you get into debt by buying things that you don’t need.

School Costs

If you’re studying, you might find that personal bank loans provide you with capital at a lower interest rate than some student loans. In this case, you can take advantage of a personal loan to help cover some of the costs associated with being a full or part-time student. Always make sure to compare student loan rates with other forms of finance available to you.


This can be valid for both homes and cars. There will come a time when you have to make some repairs on something that you own. This could come at an unexpected time that results in you not being able to afford fixing things you need to fix. If there is something that needs urgent repair, don’t let it go untouched – you can often find a personal bank loan that will be able to improve your situation.

Medical Costs

Medical expenses in the United States are extremely high, it’s important that you fully understand the total amount of money that you may have to pay if something is to happen. This is especially true for people who might not have medical insurance. Personal loans can help people pay medical costs that they otherwise might not be able to afford. It is important to note that some hospitals will have interest-free payment plans you can sign up for, if this is the case it will most likely be cheaper than a personal bank loan!

Secured Vs. Unsecured

There are two types of personal bank loans that you can get: secured and unsecured. These loans differ and have their own benefits and drawbacks. Secured loans are loans that are tied to an asset that you own. For example, you might secure a loan with a property that you own. If you end up missing payments or defaulting on the loan, the bank can come and claim your asset to help settle the outstanding debt that you have. For this reason, secured loans are considered much riskier for borrowers – you have to put other assets at risk to obtain this form of finance.

Unsecured loans on the other hand don’t have these associated risks. You don’t have to put up any collateral to obtain the loan. As you may be able to tell, these types of loans are much riskier for the lender, which means that you won’t get one of these loans as easily as you might get a secured one. They also tend to have much higher interest rates than secured loans.

Banks are much more likely to offer secured loans when compared to other non-traditional lenders. If you’re looking to get a secured personal loan, a bank loan is typically the best option you have. They will have much more flexibility when it comes to providing these types of loans. They will typically also have more flexibility when it comes to the types of assets you can use to secure the loan. Traditional lenders have many more resources when compared to smaller lenders.


Another way to help reduce your interest rates and increase your chances of getting personal bank loans is to co-sign the loan. Co-signers are individuals who offer up their signature to allow you to get a loan. This person is guaranteeing the loan – they will have to pay anything back that you are unable to. Their credit score is at risk if you don’t act responsible. For this reason, we highly recommend that you don’t use this form of loan unless you are certain you will be able to pay back what you owe. It’s unfair to put someone else’s financial future at risk for your own gain.

Advantages of Personal Bank Loans

As you can see, there are plenty of reasons people might want personal bank loans. But it can be hard to take in such a considerable amount of information at once. That’s why it’s sometimes best to look at things from a bird’s-eye-view. We’ve compiled a list of the top advantages of personal bank loans so you can have a look at it.

  • Personal – At the end of the day, the primary advantage of using a traditional lender is the fact that you have a much more personalized experience. You get to speak with a lender face-to-face about what you’re looking to get out of your lending decision. They will be able to consult you on your best options, and may even recommend a different form of finance that is more suitable to you.
  • Large Institutions – Traditional banks are typically the largest lenders in the country. They account for a significant portion of the money lent both commercially and to consumers. If you want to work with a bank that has a large presence in the industry, traditional banks are typically your best option.
  • Highly Regulated – Traditional banks are the most regulated lenders in the United States. As consumer banks, they have to abide by strict rules put in place by federal regulatory bodies. If you’re looking to work with a lender that you know has to abide by certain rules, traditional bankers are often the best.
  • Attached to Your Banker – Another great benefit is that you can often get a loan through your current banker. This means that you don’t have to work with a separate company to get the money that you want. It can make paying your payments much easier. Although it must be said that modern lenders have made it much easier to use different banks and loan providers in recent times.

Disadvantages of Personal Bank Loans

And while there are many advantages to getting a personal bank loan, there are also some drawbacks. It’s important to be aware of the negative aspects of personal bank loans. You don’t want to end up being unaware of potential issues you may face.

  • Harder to Get – At the end of the day, traditional lenders prefer to work with people that have higher credit scores. If you’ve had problems getting finance in the past, you’ll probably struggle to get a personal bank loan.
  • Longer Application – The application process for personal bank loans is also a bit longer than with some other lenders. You might have to bring in extensive documentation depending on the lender that you decide to work with.
  • Longer Decision Process – Another drawback is that sometimes lenders will take days or weeks to approve a decision with personal bank loans. This is a huge problem for someone who might need money quickly.

The Transition Online

The banking industry has seen a lot of competition arising from the technological sector. There are now online lenders that have no physical presence whatsoever. These lenders are becoming increasingly popular with borrowers in the United States. Banks have recognized this threat and began to offer their own online services.

You’ll find that many traditional banks in the United States will now allow you to fill in an online application for personal bank loans. This can be a great way to receive some of the benefits that traditional lenders offer, without having to expose yourself to some of the drawbacks. Have a look at different traditional lenders with online presences if you do feel you want to apply for a personal bank loan.

Alternatives to Personal Bank Loans

If you’ve read through this guide and decided that you don’t want apply for personal bank loans, you’re probably wondering what your other options are. Fortunately, there are plenty of options available to you in the 21st Century. You can opt to work with online lenders that will provide you with a much quicker application process. On the other hand, these lenders won’t have the same customer service approach that many traditional personal bank loans have.

You can also look at completely different forms of finance. If you’re planning on paying off your debt extremely quickly, you could even opt for a credit card or other form of revolving credit. No matter what you do, avoid payday loans at all costs. These may seem like solid alternatives to get fast cash, but they can have seriously bad effects on your financial health. Payday loan companies often charge up to 1000% interest on loans that they offer to you. If you miss a payment, you could end up in a mountain of debt that you will never be able to escape.

Make sure that you are fully aware of any alternative financing you may be looking to get involved with. As mentioned previously, you should never approach a financial decision without being an expert on the type of agreement that you’re entering.


Personal banks loans continue to be one of the most popular forms of borrowing for several reasons. They provide consumers with access to capital and the opportunity to work with reputable, large lenders who have a firm understanding of the lending market. They’re a great opportunity to prove that you can be a responsible borrower. If you pay off your personal bank loan without any hiccups, it will do wonders for your credit score and help you build your financial future.

But choosing the right lender is often the hardest part of the entire personal bank loan process. You want to make sure that you work with someone who has a longstanding reputation for customer satisfaction – anything short of this should be a red flag. We’ve researched and compiled a list of the top lenders to work with. We want our readers to have a head start when it comes to choosing a lender to borrow from. Make sure to check out our homepage for more information.

Don’t hesitate to ask your lender as many questions as possible. It’s important that you fully understand the contract your signing. If you find anything confusing, talk to a customer service representative before you sign on the dotted line. Remember, there are tons of different lenders that you can choose from, there’s no real reason to sign up for something that you’re not comfortable with.