Jun 20, 2023

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You have choices when it comes to where and how you apply for a loan, including deciding whether applying for a loan online vs. in person is better for you.

For many people, the first stop when they seek a personal loan is their local bank or credit union. Most brick-and-mortar financial institutions offer a range of financial services and the promise of personal attention.

But online banks are eager to compete for your business. In fact, they can often provide greater access and convenience to borrowers who are short on time, live in remote locations, or have difficulty visiting a physical branch location–as well as offer competitive terms.

If you’re exploring options for a personal loan, consider the pros and cons of applying in person vs. online to determine the best fit for your individual situation.

Table of contents

Online or in person, every lender needs the same information

As you consider applying for a personal loan in person or online, keep in mind that all lenders will typically ask you for the same information. To streamline the process, get organized ahead of time.

First, you want to be clear about how you intend to use the funds you borrow and how much you need. You may want to consolidate existing debt at a better rate, tackle a long-deferred home improvement project, or pay for an unexpected expense (a major car repair, for example)

If you’ve applied for a loan in the past, you’ll be familiar with the documents you need to have available for the lender so they can verify your identity and assess your creditworthiness. These include:

  • Your state-issued identification (driver’s license or other), Social Security number, proof of address, and contact information (phone numbers, email)
  • Pay stubs or bank statements that show your individual or household income, typically for the most recent three-month period
  • Employment history and contact information for your current employer
  • Bank account number and routing number where the lender will deposit funds if you’re approved for a loan

If you intend to use the loan for debt consolidation, you’ll need the balances and account numbers for those creditors.

For some borrowers, in-person applications make sense

If you already bank at a physical location, you may want to approach that bank for your personal loan.

If you have a history of banking at a physical location, you might have an existing relationship that could help you qualify for a better rate, even if your credit score is less than ideal. In addition, your bank may have a specific loan program that fits your needs.  

Some borrowers feel more comfortable dealing with a familiar staff member at their local branch, where they’ve already submitted personal information; they prefer the security of knowing who is handling their documents and their loan, and they like dealing with their loan officer face to face.

But applying for a loan in person can take more time. You may need to make an appointment and be prepared to wait longer than you would with an online lender for your loan approval and disbursement of funds. If the loan officer asks for additional documents, it could require an additional visit to the bank.

Bottom line? Choosing to apply for a loan in person works well if you can easily visit your bank or credit union during regular business hours, and don’t need your loan funds immediately.

An online loan application can be both fast and simple

Curious about how to apply for a loan online? Most online lenders offer a streamlined application process that can lead to a speedy approval and disbursement of loan funds, in some cases in just a few days. At Discover Personal Loans, for example, if your application is approved, your funds can be sent as early as the next business day after acceptance.

Discover Personal Loans also lets you find out your rate and monthly payment in just minutes with our check your rate tool, and there’s no impact to your credit score. To get started, simply enter the loan amount and repayment term you want.

And, just like those physical branches, having an existing banking relationship with an online lender can be beneficial: The majority of Discover cardmembers get a better rate than non-cardmembers, for instance.

Online lenders typically provide a host of resources to answer borrowers’ questions. With Discover Personal Loans, for example, you can talk with a U.S.-based loan specialist who will explain your options and help you complete your application.

A Discover Personal Loans customer reports this about their recent borrowing experience: “After getting so many offers, I decided to try Discover loan because I already have their credit card and just love the company. The process was quick and painless. This loan will save me thousands on interest I would have paid through the individual companies.”

Online loans provide better borrower access

Online lenders offer more than the convenience of 24/7 availability. If you can’t (or don’t want to) take time from your workday to apply for a personal loan, an online lender could be the best solution for you.

Or, maybe you live in an isolated area, you may have to travel a significant distance to visit a bank in person to apply for a loan, and you may have fewer lenders in the area to shop around for a competitive rate. It may save you time and transportation costs–and be kinder to the environment–to work with an online lender.

And no matter where you live, if it’s difficult for you to visit a bank in person for any reason, you may benefit from the convenience of applying online.

Whether you apply in person or online, rates and service are key

Regardless of whether you prefer an in-person or online loan application process, as a smart borrower you want to take the time to shop around for the right personal loan. You will want to compare costs, repayment terms, other features, and terms and conditions to ensure the loan fits your situation and offers you the best value.

Doing this will give you a sense of the service you can expect from each lender. The top lenders will have knowledgeable and helpful loan specialists you can speak with in real time to answer questions and address your concerns.

As you evaluate your choices for a personal loan, be sure to ask your prospective lender to explain the repayment terms and other loan conditions, including any origination fee or upfront fees you’ll be charged. Ask whether they have any guidance about how to get the best rate or other products you might consider.

Discover Personal Loans strives to make your online loan application process convenient, easy, accessible, and fast. You can apply online or call 1-866-248-1255 to speak directly with one of our U.S.-based loan specialists. You can also preview your rate in just a few minutes before you apply, without harming your credit score.

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