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Applying For A Loan Online Vs. In Person: Which Is Better?

Victoria Araj5-Minute Read
UPDATED: February 19, 2024


According to a 2023 survey conducted on behalf of the American Bankers Association, 71% of Americans most often use a digital banking platform to manage their bank accounts. With the rise of online banking, online lenders have also grown more prominent. Online personal loans have proven convenient for borrowers who want their money fast. Still though, a good number of people prefer to handle financial matters through more traditional means, including in-person banking.

Is one way superior to another? Drilling down a bit here, let’s walk through some pros and cons and ins and outs of applying for a loan online versus in person so you can decide if one of the two methods is clearly more suitable for you.

Is It Better To Apply Online Or In Person For A Loan?

Before we delve into the pros and cons of each option, let’s answer some key questions to help guide your decision.

Are Online Personal Loans Safe?

Online loan applications typically ask for very personal information, such as your Social Security number. This sensitive information falling into a scammer’s hands is a real concern for many people, but your online loan should be as safe as one from a traditional bank or credit union if you work with a reputable lender.

Do some research on any lender you’re considering so you can confirm their legitimacy. You can read customer reviews, peruse their website and contact their customer support team – all of which should give you an idea of what you can expect.

Do You Need The Money Fast?

The time it takes to get a personal loan can range from a few days to a week, depending on the lender. Applying through an online lender can get you your funds even faster. Thanks to the speed of submitting an online application, you could see your money on the same day you apply. This faster approval process could save you the stress of waiting for your funds to arrive.

Do You Prefer In-Person Transactions?

Some people prefer meeting in person for important matters, such as taking out a loan. This may be because they’re uncomfortable sharing their financial information online or over the phone.

That said, others prefer the convenience and flexibility of making financial decisions from the privacy of their home.

Where Can You Find The Best Loan?

The rate and term of your loan offer can play a huge role in what lender you choose. Online lenders may be more lenient in their credit score requirements. But if you take out a loan from a bank that you have an existing checking or savings account with, you may be able to enjoy added benefits. The surest way to find the best deal is to simply shop around and compare your loan options.

Applying For A Loan Online Vs. In Person: Pros And Cons

Both online and in-person loans come with particular benefits and drawbacks. Next up are the pros and cons of each so you can be privy to them before settling on one option or the other.

Online Loan Pros

  • Applications being available to complete at home, any time of day, at your convenience
  • Faster approval and fund disbursal, sometimes within the same or next business day
  • The ability to more easily shop around and get prequalified with several lenders
  • Potentially more relaxed eligibility requirements

Online Loan Cons

  • Personal information being submitted through online forms
  • The need to be alert to online scammers
  • The potential for a higher loan interest rate than with a traditional lender

In-Person Loan Pros

  • Face-to-face, personalized assistance from a loan officer
  • No sharing of personal information or forms online
  • The opportunity to ask questions as they arise in the meeting
  • The potential for a better rate and term if you have an existing relationship with the bank

In-Person Loan Cons

  • The need to bring all required documents to the physical branch
  • Appointments having to be scheduled within the bank’s business hours
  • The potential for longer processing times and receiving funds more slowly

When To Apply For A Loan Online

You might want to consider an online loan application if:

  • You’re comfortable navigating the online loan application process: If you have a grasp on how to securely submit your personal information online and identify scams, applying for a loan online can be a fast, convenient way to get funds.

  • You’re short on time: It’s possible to get approved for an online loan and receive funds within a business day. And if your schedule makes setting up an in-person appointment during banking hours difficult, you can fill out an online application any time of day.

  • You want to research your option: If you opt to go digital, you can easily get prequalified with multiple lenders. Prequalification lets you compare offers without facing multiple hard inquiries. This way, you can be sure you’re getting the best possible loan term and interest rate.

  • You don’t have a preexisting relationship with a lender: If you don’t have an account with a bank or credit union, you won’t be eligible for customer-exclusive offers and rates. In this case, you won’t miss out on such deals if you apply online.

  • You don’t have a strong credit history: Some online lenders have more relaxed requirements for loan approval. Unlike many traditional lenders, they may consider factors beyond your credit. For example, they may look at your utility bill payment history or debt-to-income ratio (DTI).

When To Apply For A Loan In Person

Applying for a loan at a physical location may make more sense if:

  • You’re uncomfortable with sharing personal information online: In-person applications can reduce the stress of putting sensitive information online. You can also avoid the risk of falling victim to online scams.

  • You want personalized, face-to-face guidance: A loan officer will learn about your financial situation and guide you through the loan application process with your personal preferences in mind. They’ll also likely be able to provide loan management support once you enter repayment.

  • You have a preexisting relationship with a lender: If you already belong to a local bank or credit union, check to see if they have special offers for their customers. For example, some financial institutions may offer their members a lower interest rate than non-members.

  • You have time to spare: If you’re not in a huge rush to secure funds, you can take advantage of the additional support that comes from working with an in-person loan officer. And if your schedule doesn’t limit your ability to meet within business hours, an in-person appointment may be the way to go.

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Final Thoughts

Getting a personal loan through an online lender can offer speed and convenience. However, you might find yourself missing the more personalized experience that speaking with a loan expert at a brick-and-mortar bank provides. Whether you would be better off applying for a loan online or in person depends on your needs and personal preferences, and only you know what’s ultimately going to be best.

If you need fast funding and are ready to give online lending a try, apply today with Rocket LoansSM and see what you prequalify for.

Victoria Araj

Victoria Araj is a Section Editor for Rocket Mortgage and held roles in mortgage banking, public relations and more in her 15+ years with the company. She holds a bachelor’s degree in journalism with an emphasis in political science from Michigan State University, and a master’s degree in public administration from the University of Michigan.