A good interest rate on a personal loan is around 5.99%. The average APR for a two-year personal loan from a bank is 12.17%, according to the latest Federal Reserve data, and the best personal loans have APRs as low as 5.99% for the most creditworthy borrowers. The rates you get will depend heavily on your credit, income, debt, and other financial factors.
The best way to get a decent interest rate on a personal loan is to comparison shop and get pre-qualified. WalletHub’s free personal loan pre-qualification tool helps you see which lenders have a high chance of approving you, as well as what interest rates you are likely to get if approved. You can then compare your pre-qualified offers to see what a good interest rate on a personal loan is for you personally.
Good Interest Rate on a Personal Loan by Credit Score
750 or above (excellent credit)
You may be able to get interest rates as low as 5.99% - 12%. That’s where the majority of lenders set their minimums.
700 to 749 (good credit)
You’re unlikely to get the lowest interest rates available, but you could get an offer with APRs of 12% - 17%.
640 to 699 (fair credit)
You probably won't have to pay a lender's maximum, but expect to get interest rates between 17% - 21%.
Below 640 (bad credit)
You probably won’t find rates lower than 21% to 36% from a bank or online lender. Keep in mind that personal loans from federal credit unions are capped at 18%.
If you’re planning on consolidating debt, a good interest rate on a personal loan is one that’s significantly lower than the rates on your existing debt. But as you compare personal loan interest rates, don’t neglect other terms.
A low interest rate might not be as great as it seems if you also have to pay costly fees to go along with it. For example, many lenders charge “origination fees” of 1% to 6% of the loan amount as an extra cost for opening the loan.
This answer was first published on 08/05/19 and it was last updated on 02/20/24. For the most current information about a financial product, you should always check and confirm accuracy with the offering financial institution. Editorial and user-generated content is not provided, reviewed or endorsed by any company.
A typical interest rate for a personal loan is between 4% and 36%. The exact interest rate you get for a personal loan will depend on a number of factors, such as your income, existing debt, employment status and credit score, among others. Below you can see the average personal loan interest rate for each credit rating based on the latest WalletHub data.
It’s easy to compare personal loan rates, which is good because doing so is essential to finding the best loan offers. Personal loan rates can range all the way from 6% to 36%, and they sometimes reflect more than just interest charges. The rates advertised for personal loans are actually annual percentage rates (APRs). Technically, the difference is that APRs include both interest and fees. However, origination fees are the most common type of personal...
Some of the best fixed rate personal loans are from LightStream by SunTrust Bank, which offers APRs ranging from 3.99% to 16.99%. A fixed rate means the APR the borrower receives at the beginning will never change over the life of the loan. The alternative to a fixed rate personal loan is a variable rate personal loan, where the APR is tied to an index rate. That is usually the prime rate, the rate at...
A good personal loan interest rate depends on your credit score: 740 and above: Below 8% (look for loans for excellent credit) 670 to 739: Around 14% (look for loans for good credit) 580 to 669: Around 18% (look for loans for fair credit)
The National Association of Realtors expects mortgage rates will average 6.8% in the first quarter of 2024, dropping to 6.6% in the second quarter, according to its latest Quarterly U.S. Economic Forecast. The trade association predicts that rates will continue to fall to 6.1% by the end of the year.
Also, mortgage rates are still much higher than we've been used to in recent years. In May 2024, the average 2 year fixed rate is 4.74%. While this is a significant drop from its July 2023 peak of 6.86%, it's still much higher than December 2021 when was 2.34%. Find out more in our guide to the Best mortgage rates.
An excellent credit score, consistent income and low debt-to-income ratio are key to securing a low-interest personal loan. But if your finances aren't in the best shape, consider taking a step back to improve your credit score and lower your utilization rate before applying.
The personal loan interest rate play an important role in determining the EMIs and total repayment amount. The interest rate of your personal loan depends on your financial report and credit score. You can negotiate your interest rate to adjust your EMI to make it more manageable.
Many give preference to borrowers with good or excellent credit scores (690 and above), but some lenders accept borrowers with bad credit (a score below 630). The typical minimum credit score to qualify for a personal loan is 560 to 660, according to lenders surveyed by NerdWallet.
Driving the news: The median Fed official now expects interest rates to be somewhat higher in 2025 and 2026 than they did in December — anticipating fewer rate cuts will be justified in the coming two years. The median projection for the longer-run rate also ticked up, to 2.6% from 2.5%.
At this time, 10% is a good interest rate for a personal loan for a borrower with good credit. Anything below the national average personal loan interest rate, set by the Federal Reserve, is considered a good personal interest rate. Borrowers with poor credit scores will likely be offered a higher interest rate.
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