When shopping for a cheap personal loan, think local.

Your neighborhood credit union should be your first stop for borrowing money, especially if you don’t have perfect credit. Compared with other lenders, credit unions often have lower interest rates, more flexible terms and a loan officer willing to look at more than your credit score.

A personal loan from a credit union is a particularly good option if you:

• Are already a member of a credit union or can qualify to become a member
• Have average or bad credit
• Don’t mind having to visit a branch to complete the application process

How a credit union personal loan works

Credit unions are not-for-profit financial organizations that serve members who live, study, work or worship in a particular area. If you meet the credit union’s requirements, you typically pay a one-time membership fee and a deposit of up to $25. To apply for a loan, you need to become a member first.

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