Which banks have the lowest interest rates on personal loans

We're going to address the question of which bank has the lowest interest rate on a personal loan. If you have good credit, it's understandable that you might want to start with a bank for a personal loan. Banks are closely regulated by the FDIC, which means that their policies are well established and they're reviewed regularly. They also tend to have very competitive interest rates, but that is a two-edged sword. That means that they are also likely to be very restrictive. If you have a fair credit score or worse, you might struggle to get approved by a bank. Banks also offer bigger loans than most other lenders, so if you're looking for a substantial amount of money, a bank might be your best bet. Later in the video, I will tell you an easy way that you can shop around for other lenders to make sure you're getting the best rate that you can in your situation. But right now, let's get right into which banks have the lowest interest rate. Not every bank offers personal loans. Many banks just don't think it's profitable enough for them to do it. We track 15 national or large regional banks that do provide personal loans. The range of APRs of these banks look like this. The number on the left is their minimum APR and the one on the right is their maximum APR. They all sit in the same general range, but as you can imagine, the bank with the lowest APR is whichever bank will give you the lowest APR. Of course, they can't give you an APR that's lower than their absolute minimum, so let's reorder the group based on the minimum APR. Wells Fargo has the lowest stated minimum APR, but Wells Fargo deserves a big asterisk because you can only apply for a loan with them if you've had an account with them for at least 12 months. That kind of restriction is not uncommon amongst banks. Some will only lend to existing customers and others will only give their best rates to existing customers. Santander, Discover, M&T Bank, and U.S. Bank round out the top five, but things aren't too bad even in the top 10. In addition to long-standing customers, banks may also limit their lowest APRs for loans with shorter terms or specific loan amounts. It's great to look at the lowest APR that a bank will offer, but it's important to recognize that only about 10% of their borrowers will qualify for that rate. If you think you can get approved for a personal loan from a bank, but you're doubtful that you would qualify for the lowest rate, you might be more concerned about their top rate. So, let's reorder this list and list them by their top rate. The advantage to looking at the data like this is that you know you won't be offered anything higher than this amount. In this case, M&T Bank is significantly lower than anyone else. The asterisk in this case is that you have to live in one of the following states in order to apply for a loan from M&T Bank. Truist, USAA, Citibank, and Axos Bank round out the top five. You might have noticed the outlier at the bottom there. SoFi started out as a fintech company, but is now a bank. For that reason, they still look a little bit more like a traditional online lender, but I've included them because technically they are now a bank. If you're looking for a low-interest loan, banks aren't the only place to look. When credit unions offer personal loans, they may not offer lower minimum APRs, but they often have lower maximum APRs. You need to be a member of a credit union to apply, and some credit unions limit their membership to certain affinity groups. Some credit unions might even extend credit to long-time members with less than perfect credit. Fintech and online lenders accept a broader range of applicants. That means you are more likely to be accepted by a fintech or an online lender than you are by a bank. The reason banks and credit unions can offer lower rates is because their cost of capital is lower. They aren't borrowing money from other institutions for the money that they are lending out. They are using customer deposits. Customer deposits only cost them the amount that they offer in interest on a savings account, and really that interest is usually so low that it's not even really worth mentioning. We recommend that before you accept a loan, you shop around. If you have good or excellent credit, you should always get at least two or three approvals before you accept a loan. That's the only way to be sure you're getting the best deal that you can in your circumstances. You see, every lender has their own algorithm for deciding who to lend to and at what rate to offer. You never know who is going to be the lowest cost lender for you. At The Yukon Project, we've tried to make shopping around easy. If you visit our Marketplace page, you can apply to any one of our featured lenders. Behind the scenes, we will check your rate with up to 40 other lenders. Our partners use a soft credit check, so applying won't hurt your credit score. We will show you all of your approved offers so you can select the loan that would be best for you. So there you have it. Those are the banks with the lowest interest rates for personal loans. If you are aware of any banks that offer personal loans that we don't have on our list, leave a comment below. We're trying to build a community of people who can share their experiences so we can all make better decisions about our personal finances. If you found this information useful, please like this video and subscribe to our channel. Your support really helps us out and we appreciate it. Thanks for watching.