Average personal loan interest rates

The average personal loan interest rate was 10.28% in the first quarter of 2022, according to the Federal Reserve. In general, the interest rate you receive on a personal loan will range from a low 4% to a high 36%.

To score the lowest rates, you need to have excellent credit. Some experts identify 760 or higher as the sweet spot. Other aspects of your finances, the loan term and the amount you apply for can also influence your rate.

We reviewed over 130 lenders before selecting lenders with the best personal loan rates. Comparing offers from multiple lenders can help you find the best deal available.

Interest rate vs. APR: What you need to know

Banks, credit unions and online lenders often interchangeably use interest rate and annual percentage rate (APR) as if they’re the same thing. But there’s an important distinction. When you’re looking at the average interest rate on a personal loan, you’re seeing a number that doesn’t include regular fees.

An APR is the percentage of your loan balance that you pay in interest and fees over the course of a year. An APR only includes fees you’re required to pay if you take out a loan.

The most common fee associated with personal loans is an origination fee, which covers application costs. These tend to range from 1% to 6% of your loan amount and are either added to or subtracted from your funds before you receive them. If you take out a line of credit, your APR might also include annual fees.

Your APR doesn’t include every possible fee that you could pay if you take out a loan. Late fees, prepayment penalties and nonsufficient funds (NSF) fees are all counted separate from the APR.

Must read: Best personal loans with no origination fees

Personal loan interest rates

Personal loan interest rates depend on a wide range of factors, including your credit score and the type of financing you get.

Interest rates by credit score

Your credit score is one of the most important factors that lenders use to determine the interest rates you qualify for. The two credit scoring models are FICO and VantageScore 4.0.

It’s not a perfect science, and FICO and VantageScore have some differences, but your credit scores can help you predict what interest rates you may receive when borrowing credit and help you choose a lender that can accommodate your credit rating.

• Graph
• Chart

While some personal loans stop at 36%, fair and bad credit borrowers can struggle to qualify for a personal loan at all. In many cases, they may be turning toward short-term loans like payday and installment loans. These can come with rates that top 300%.

Interest rates by financing type

Lenders tend to price different types of financing differently. Here’s how personal loan rates compare to credit cards and car loans from banks in the beginning of 2020.

Type of financing	Average rates at a bank
Personal loan	9.09%
Car loan (48 months)	4.58%
Car loan (60 months)	4.67%
Credit card	14.51%

^{Source: Federal Reserve Consumer Credit Statistics, Q3 2021}

Personal loans vs. credit cards

As you can see from the Federal Reserve data, credit cards tend to have a higher average interest rate than personal loans. Unlike credit cards, a fixed-rate loan has a set interest rate.

This means interest payments don’t fluctuate — helping the average interest rate be a little lower. You can also borrow more on overage, even with a lower credit score.

But personal loans don’t come with some of the benefits of a credit card. This makes personal loans a bad choice for regular spending — but a great choice for expenses like debt consolidation.

What is a good interest rate on a personal loan?

While the average personal loan interest rate was around 10.7% as of September 2021, the average rate was a touch over 10% higher a year later at 11.89%. Generally, any interest rate under 12% is generally considered a good interest rate.

Personal loan interest rates vary widely depending on your credit score. So if you have good to excellent credit, you can expect to receive an interest rate around the average.

But for those with poor credit, you can expect higher interest rates. While these may be higher than the national average, they can still be good — especially if you have a shaky credit history.

Average personal loan rates from top lenders

Most borrowers won’t qualify for the lowest advertised interest rate. So we considered the full range of rates lender offers when coming up with this list.

We also didn’t exclude offers that are only available to a select few borrowers such as community bank, local credit union or invitation-only loans. And we limited the number of connection services — many share the same lowest rates because they work with similar partners.

The interest rate you receive will depend on factors like your credit history, annual income and overall financial situation. Prequalify with multiple lenders to find the best personal loan interest rate available to you.

Online lenders

Lender	APR range
Avant	9.95%–35.99%	Go to site
Best Egg	8.99%–35.99%	Go to site
Earnest	2.49%–17.24%
FreedomPlus	8.99%–35.99%	Go to site
Laurel Road	7.99%–23.25%
LendingClub	9.57%–35.99%	Go to site
LendingPoint	7.99%–35.99%	Go to site
LightStream	Competitive	Go to site
OneMain Financial	18%–35.99%	Go to site
Happy Money	11.72%–24.5%	Go to site
Prosper	8.99%–35.99%	Go to site
Rocket Loans	9.12%–29.99%	Go to site
SoFi	8.99%–29.99%	Go to site
Upgrade	8.49%–35.99%	Go to site
Upstart	7.8%–35.99%	Go to site
Monevo	5.4%–35.99%	Read review
LendingTree	As low as 5.99%	Read review

• SoFi's terms and conditions

  Fixed rates from 8.99% APR to 29.99% APR reflect the 0.25% autopay interest rate discount and a 0.25% direct deposit interest rate discount. SoFi rate ranges are current as of 02/06/2024 and are subject to change without notice. The average of SoFi Personal Loans funded in 2022 was around $30K. Not all applicants qualify for the lowest rate. Lowest rates reserved for the most creditworthy borrowers. Your actual rate will be within the range of rates listed and will depend on the term you select, evaluation of your creditworthiness, income, and a variety of other factors.
  Loan amounts range from $5,000– $100,000. The APR is the cost of credit as a yearly rate and reflects both your interest rate and an origination fee of 0%-7%, which will be deducted from any loan proceeds you receive.
  Autopay: The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. Autopay is not required to receive a loan from SoFi.
  Direct Deposit Discount: To be eligible to potentially receive an additional (0.25%) interest rate reduction for setting up direct deposit with a SoFi Checking and Savings account offered by SoFi Bank, N.A. or eligible cash management account offered by SoFi Securities, LLC (“Direct Deposit Account”), you must have an open Direct Deposit Account within 30 days of the funding of your Loan. Once eligible, you will receive this discount during periods in which you have enabled payroll direct deposits of at least $1,000/month to a Direct Deposit Account in accordance with SoFi’s reasonable procedures and requirements to be determined at SoFi’s sole discretion. This discount will be lost during periods in which SoFi determines you have turned off direct deposits to your Direct Deposit Account. You are not required to enroll in direct deposits to receive a Loan.

Banks and credit unions

Lender	APR range
Alliant	Starting at 10.49%
Citibank	11.49%–20.49%*	Go to site
Citizens Bank	7.99%–20.89%
Discover	7.99%–24.99%	Read review
Marcus by Goldman Sachs	6.99%–24.99%	Read review
M&T Bank	8.49%–15.74%
Navy Federal Credit Union	7.49%–18%
PenFed	Starting at 7.99%	Read review
PNC Bank	As low as 6.39%
Santander	6.99%–24.99%
TD Bank	5.99%–19.99%
U.S. Bank	8.24%–21.49%
USAA	8.29%–18.51%	Read review
Wells Fargo	7.49%–23.24%	Go to site

• Citi's terms and conditions

  *Rates as of 05-31-2024. Your APR may be as low as 11.49% or as high as 20.49% for the term of your loan. The lowest rate quoted assumes excellent credit and a loan term of 24 or 36 months. Your APR will depend on a variety of factors including your creditworthiness, term of loan, and existing relationship with Citi. For example, if you borrow $10,000 for 36 months at 15.99% APR, to repay your loan you will have to make 36 monthly payments of approximately $351.52.
  
  There is a 0.5% APR discount if you enroll in automatic payments at loan origination. Additionally, existing Citigold and Citi Priority customers will receive a 0.25% discount to the interest rate. If you are in default, your APR may increase by 2.00%. No down payment is required. Rates subject to change without notice.
  
  You must be at least 18 years of age (21 years of age in Puerto Rico). Co-applicants are not permitted. Loan proceeds cannot be used for post-secondary educational or business purposes.
  
  If you apply online, you must agree to receive the loan note and all other account disclosures provided at loan origination in an electronic format and provide your signature electronically.
  
  Credit cards issued by Citibank, N.A. or its affiliates, as well as Checking Plus and Ready Credit accounts, are not eligible for debt consolidation, and Citibank will not issue payoff checks for these accounts. If you are unsure of the issuer on the account, please visit https://www.citi.com/affiliatesproducts for a list of Citi products and affiliates

Banks tend to have lower interest rates

Online lenders are fast, but they often charge more for the convenience — notable exceptions being SoFi and LightStream. A 36-month personal loan from a bank had an average interest rate of 10.09% — slightly higher than the national average for a 24-month personal loan. But credit unions only had an interest rate of 8.95%, according to data from the National Credit Union Administration.

Banks and credit unions are able to offer lower average interest rates because they usually only work with current account holders.

That being said, the average personal loan rate doesn’t differ significantly between banks and online lenders. You may be able to find lower personal loan rates with banks, but that doesn’t mean you’ll qualify.

Your best course of action will be to compare personal loans from both banks and online lenders before you make a final decision.

9 factors that impact interest rate

The average personal loan interest rate is typically based on requirements and conditions lenders set. But there are a few common factors that influence rates with every personal loan lender.

1. The better your credit score and credit history, the more likely you are to qualify for a competitive interest rate below 10%.
2. Opting for a smaller loan amount is a good way to score an interest rate on the lower end of the spectrum.
3. A shorter loan term will have higher interest rates on average. But long loan terms, even with lower interest rates, often cost more overall.
4. Some lenders will offer a rate discount between 0.25% to 0.50% off your APR — that’s interest plus fees — when you sign up for autopay.
5. Fees don’t directly impact your personal loan interest rate. But since an origination fee or application fee is worked into the APR, it will have an affect on the overall cost of your loan.
6. A cosigner or coapplicant with good to excellent credit can help lower your interest rate by agreeing to take on shared responsibility for your loan.
7. A secured loan will often have lower average interest rates than an unsecured loan. If you have a savings account, CD or other collateral, you may be able to use it to secure your loan and qualify for better terms.
8. Having a higher income is a good way to get a personal loan with a lower interest rate. But no worries if you don’t have the best income out there. Your debt-to-income ratio often matters more.
9. Your debt-to-income ratio is the percentage of debt you have compared to your income. The lower you’re already paying on loans and credit cards, the better your chances of getting a good interest rate.

How to compare APRs on a personal loan

These tips can help you make a more accurate comparison.

Compare loans with the same terms to make an apples-to-apples comparison. A longer loan term increases the total cost of your loan.

Don’t assume you’ll qualify for the lowest APR available if you’re comparing a range of rates. The average rate is usually higher.

Consider the maximum APR if your credit score is below 670 — what lenders consider to be good credit.

Ask your lender for an APR quote if a lender only advertises interest or fees.

Read the fine print before you make a decision. Some lenders advertise rates with an autopay or relationship discount you might not qualify for.

Prequalify with your top choices to compare the rates you might expect if you were to go through with the application. But make sure the lender offers a soft credit pull.

Compare lenders by more than only interest rate

Personal loan interest rates are one of the most important factors when it comes to how much you spend. But they’re not the be-all, end-all when you’re looking to keep your monthly payment low and your costs down.

APR: A lower interest rate doesn’t mean much if the fees that your lender charges make the APR higher than other personal loans you qualify for.

Discounts: Any discount to your interest rate or APR can significantly reduce your costs. Not all lenders offer discounts, so be on the lookout for those that do.

Fees: There are no-fee personal loans out there. While it’s uncommon, lenders like SoFi won’t charge origination fees, prepayment fees or late fees. But even a lower late fee can make the difference when it comes to the right personal loan.

4 common personal loan fees

Your personal loan interest rate isn’t the only expense that you need to take into account. Weigh these other expenses when you compare lenders.

• • Some lenders charge an origination fee of around 1% to 5% of the loan amount at closing. Some deduct this from the funds you receive, while others add it to your loan balance. This is the only fee included in the APR.
  • Most lenders charge a flat late fee of around $15 to $35 or 5% of the payment due. Most also have a 15-day grace period before the late fee kicks in. This is also not included in the APR.
  • A nonsufficient funds fee (NSF), also known as a returned check or returned payment fee, will be charged if a payment bounces from your account. Typically it’s the same as a late fee, though sometimes it’s slightly higher.

Be aware of your monthly payment

Your monthly payments have the most immediate effect on your budget and are arguably the most important cost to consider when you apply for a loan. Monthly payments are based on the amount, rate and repayment term of your loan.

When you apply for a personal loan, you must show that you consistently have a high enough income and low enough debts to cover the monthly payment over the life of the loan.

Longer loan terms can give you higher monthly repayments. But that will increase the overall cost of your loan. Go for the shortest loan term you can afford to save on the monthly and total cost.

How do I calculate APR?

Follow these steps to calculate APR on a loan:

1. Add up the fees and interest you’d pay over the life of a loan.
2. Divide the result by the loan amount.
3. Multiply the result by 365.
4. Divide the result by the number of days in the loan term.
5. Multiply the result by 100.

Calculate how much you might pay

Using the average interest personal loan interest rate, you can estimate your monthly payment by entering your desired loan amount, loan term and interest rate into our personal loan calculator.

Feel free to experiment. Loan amount and loan term affect monthly payment as much as interest rate, so see what yours could be with different settings.

Bottom line

The key to getting a competitive rate on a personal loan is comparing lenders. While almost every lender considers your credit score, each has their own method of evaluating your application that could result in a higher or lower rate.

You should compare low-interest personal loans to find some of the most competitive interest rates out there. And here are some top lenders we compare — including their APR range, minimum credit score requirement and the loan amount they offer.