Federal credit unions are one of the more flexible options for personal loans – and both First Tech and PenFed offer solid products. To qualify, you need strong credit. But if you do, you’ll have access to personal loans with competitive rates and generous repayment terms.
First Tech vs. PenFed at a glance
Both credit unions require you to be a member in order to borrow a personal loan. However, there are a few major differences you should know before opening an account.
| First technology | Pen Fed | |
|---|---|---|
| Bank rate score | 4.6 | 4.7 |
| Better for | Unexpected or urgent expenses | Competitive rates |
| Loan amounts | $500 to $50,000 | Up to $50,000 |
| APRs | As low as 8.94% | 8.99% to 17.99% |
| Length of the loan | 24 to 84 months | Up to 60 months |
| Costs | Optional costs | Optional costs |
| Minimum credit score | 695 | 700 |
| Time for financing | As soon as the same working day | As soon as the next working day |
Personal loans from First Tech
First Tech services residents of Lane County, Oregon. But even if you don’t live or work in this area, you can still qualify for membership by joining the Financial Fitness Association or the Computer History Museum. It is one of the few lenders that offers personal loans from €500. Combined with the potential for same-day turnaround, First Tech is a great option if you’re dealing with rush costs.
The terms are also generous. You have a maximum of 84 months to repay your loan. For larger amounts, this can help make your monthly payments more manageable. But keep in mind that the longer the term of your loan, the more interest you pay.
However, there are a few negatives. It has a higher starting rate than PenFed. If you have good to excellent credit, you may be able to score a lower APR with PenFed or another top personal loan provider. And there is no option to add a co-borrower.
Positives
- Low starting amount.
- Reflection period of 10 days.
- Fast funding timeline.
Disadvantages
- Higher starting APR.
- Membership required.
- No option to add a co-borrower.
PenFed Personal Loans
PenFed operates in the United States and some of its territories. It has one of the lowest starting rates on the market, and because it is a federal credit union, the APR is capped at a low 17.99%. Online lenders and banks don’t have that limit, so if you don’t have good to excellent credit, you might see rates of 20 percent or higher.
It also has a fast funding timeline. Processing and funding your loan can take as little as one business day. That’s not as fast as First Tech, but still faster than many other lenders.
You even have the option to apply jointly with a co-borrower, something that many other lenders do not offer. A co-borrower has equal access to the funds, but the lender may not offer better terms or rates to co-applicants.
Positives
- Joint applications accepted.
- Lower starting APR.
- Fast funding timeline.
Disadvantages
- Requires strong credit.
- Membership required.
- High late and NSF fees.
How to Choose Between First Tech and PenFed
Despite some superficial similarities, First Tech and PenFed are better for different types of borrowers. First Tech is good for covering emergency costs, while PenFed may be the better option if you need to add a co-borrower.
First Tech has a fast turnaround time for emergencies
First Tech is one of the few lenders that can fund your loan the same day you submit your application. While there are conditions – such as applying early in the day – it’s a good option if you need immediate financing. However, you may need to already have an account to take advantage of the fast turnaround time. Otherwise it may take a day or two, as with most other lenders.
PenFed charges competitive rates
PenFed offers one of the lowest starting rates on the market. While not everyone will qualify, you may be able to take advantage of the low APR if you have an excellent credit score. You can also apply with a well-qualified co-borrower. And even though its financing timeline is a little longer than First Tech’s, you can still expect your loan to be processed quickly, so it can still be a good option for emergencies.
Compare lenders before applying
Both First Tech and PenFed offer competitive rates – although PenFed is barely better than First Tech. Whichever you choose, be prepared to open an account if you want to sign up. You should also compare other lenders to ensure you get the lowest rate for your financial profile.
