Compare fixed rate vs. variable rate loans: What's the difference?

Compare fixed rate vs. variable rate personal loans

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Find out whether you should lock your rate.

As well as choosing a lender, deciding on your loan term and choosing between secured and unsecured, you also have to decide whether you want your rate to be fixed or variable. These two rate options offer different benefits and drawbacks. The guide below will take you through the differences between fixed and variable interest rates and help you decide which option is right for you.

LendingClub Personal Loan

LendingClub Personal Loan

LendingClub offers you the chance to borrow up to $40,000 as alternative to bank personal loans. Rates from 6.16%–35.89% * APR based on your credit score.

  • Min. Loan Amount: $1,000
  • Max. Loan Amount: $40,000
  • Loan Term: 3 to 5 years
  • Turnaround Time: Up to 7 days
  • Total Costs: Depends on your credit score
  • Use for a variety of purposes
  • Confidential and secure online application

    The key differences between fixed and variable interest rates on personal loans

    Fixed ratesVariable rates
    DescriptionYour rate remains the same throughout the specified term.Your rate may fluctuate throughout the loan term.
    Main benefit
    • Your repayments remain the same no matter what’s happening in the market.
    • Your starting rate is usually lower than that of fixed rate loans and could possibly remain lower.

    What are fixed and variable interest rates on personal loans?

    Personal loans come with two types of interest rates: fixed or variable. Fixed interest rates remain the same throughout the specified term, which may be for the entire loan term or for an introductory period. If you opt for a variable rate personal loan, you’ll receive the advertised rate, but this rate may change throughout the loan term depending on interest rate movements in the market.

    Compare a range of fixed and variable rate personal loans

    Rates last updated July 23rd, 2018

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    Name Product Product Description Min. Credit Score Max. Loan Amount APR
    Even Financial Personal Loans
    Get connected to competitive loan offers instantly from top online consumer lenders.
    580
    $100,000
    4.99%–35.99% (fixed)
    Upgrade Personal Loans*
    Affordable loans with two simple repayment terms and no prepayment penalties.
    620
    $50,000
    6.87%–35.97% (fixed)
    LendingClub Personal Loan
    A peer-to-peer lender offering fair rates based on your credit score.
    660
    $40,000
    6.16%–35.89% (fixed)
    SoFi Personal Loan Fixed Rate (with Autopay)
    No fees. Multiple member perks such as community events and career coaching.
    680
    $100,000
    6.575%–14.865% (fixed)
    Credible Personal Loans
    Get personalized rates in minutes and then choose a loan offer from several top online lenders.
    Good to excellent credit
    $50,000
    4.99%–36% (fixed)
    Best Egg Personal Loans
    A prime lender with multiple repayment methods.
    640 FICO®
    $35,000
    5.99%–29.99% (fixed)
    Prosper Personal Loans
    Borrow only what you need for debt consolidation, home improvements and more — with APRs based on overall creditworthiness.
    640
    $40,000
    6.95%–35.99% (fixed)
    NetCredit Personal Loan
    Check eligibility in minutes and get a personalized quote without affecting your credit score.
    550
    $10,000
    34%–155% (Varies by state) (fixed)
    OneMain Financial Personal and Auto Loans
    An established online and in-store lender with quick turnaround times. Poor credit is OK.
    Varies
    $30,000
    16.05%–35.99%* (fixed)
    Monevo Personal Loans
    Quickly compare multiple online lenders with competitive rates depending on your credit score.
    580
    $100,000
    3.09%–35.99% (fixed)
    FreedomPlus Personal Loans
    Consolidate debt and more with these low-interest loans. Cosigners welcome.
    640
    $35,000
    4.99%–29.99% (fixed)

    Compare up to 4 providers

    What are the benefits of each interest rate type?

    Fixed rate personal loans

    • Your repayments remain unchanged throughout the specified term, so you know what to expect.
    • You may be able to secure a low rate.

    Variable rate personal loans

    • The starting rate is usually lower than that of the comparable fixed rate loan.
    • It’s possible for the lower interest rate to remain low throughout the term of your loan.

    interest rate choice

    What are the drawbacks of each interest rate type?

    Fixed rate personal loans

    • The starting rate is usually higher than that of comparable variable rate loans.

    Variable rate personal loans

    • Your interest rate could increase and make your loan more expensive over time.
    • You may find less competitive rates.

    How do I work out which rate type is best for me?

    The right type of interest rate for you will depend on a few different factors. Here are a couple of questions you can ask yourself to help you decide:

    • What interest rate can I get? When you find the most competitive rate, be sure to check the eligibility criteria of that loan to see if you qualify.
    • How affordable are the monthly payments? If your repayments are only just working with your budget, a fixed rate loan will ensure they won’t increase.

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    US Personal Loans Offers

    Important Information*
    Even Financial Personal Loans

    Get connected to competitive loan offers instantly from top online consumer lenders.

    Prosper Personal Loans

    Borrow only what you need for debt consolidation, home improvements and more — with APRs based on overall creditworthiness.

    LendingClub Personal Loan

    A peer-to-peer lender offering fair rates based on your credit score.

    SoFi Personal Loan Fixed Rate (with Autopay)

    No fees. Multiple member perks such as community events and career coaching.

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