In a recent MarketWatch Guides personal loans survey, 1,500 respondents reported they took out loans for debt consolidation, home repairs or everyday expenses. No matter the purpose of your loan, consider one of our carefully researched lenders offering the best low-interest personal loans to save on fees, get a low rate and reap additional rewards.
Key Takeaways
- Our top recommendations for the best low interest personal loans are Discover, LightStream, SoFi, PenFed, Upstart, U.S. Bank, Upgrade and Wells Fargo.
- The best low interest loans don’t have origination fees and fund your loan on the same or next business day.
- To get the lowest interest rate, choose a loan with shorter repayment terms.
The Best Low-Interest Personal Loans
There are countless options to choose from when it comes to finding the best low-interest personal loan. To help you save time, we’ve analyzed and reviewed the top lenders available.
Discover
Best for Low Rates
4.1
Interest Rate (APR)7.99% to 24.99%Term Options36 months to 84 monthsLoan Size Offered$2.5k to $40k
Discover Overview
Discover is a well-known bank and credit card company that also offers some of the best low-interest personal loans, with rates ranging from 7.99% to 24.99% APR, making it our top pick for low interest personal loans.
Unlike many lenders, Discover doesn’t charge origination fees or prepayment penalties, which means all of your loan funds will end up in your pocket. But late feesof $39will apply if you miss a payment. Discover also has a unique free FICO monthly credit score report for its customers.
Pros and Cons of Discover
Pros Monthly credit score: Discover is the only lender on this list to provide access to free FICO credit score updates. No upfront fees: There are no origination fees or prepayment penalties, although there is a $39 late payment fee. Fast funding: Get your money as early as the next business day. Smaller loan range: The minimum amount you can borrow is a relatively high $2,500 and the maximum amount you can borrow is only $40,000. No discounts: Discover is one of only three lenders on our list that doesn’t offer an automatic payment discount. Minimum income requirement: You must earn at least $25,000 per year in household income to qualify for a loan.
Discover Interest Rates
Discover’s personal loans have fixed interest rates, so your monthly payment stays the same. Discover has one of the lowest minimum APRs on our list, 7.99%, and a competitive maximum APR of 24.99%, but your exact rate will depend on your credit profile. Loan amounts vary from $2,500 to $40,000, and repayment terms run from three to seven years. Discover doesn’t advertise any rate discounts. You can manage and repay your loan on the mobile app.
LightStream
BEST GUARANTEES
4.4
Interest Rate (APR)6.99% to 25.99%Term Options24 months to 144 monthsLoan Size Offered$5k to $100k
LightStream Overview
LightStream, a division of Truist Bank, has competitive APRs (6.99% to 25.99% with a 0.50% AutoPay discount) and an easy online application process. If you have excellent credit, you won’t find a lower rate anywhere else: LightStream’s “Rate Beat Program” promises to beat any competitor’s rate by 0.1 percentage points if you meet certain requirements.
Pros and Cons of LightStream
Pros No fees: LightStream doesn’t charge origination fees, late fees or prepayment fees Discounts: Sign up for AutoPay when you set up your loan and your rate will be 0.50% lower Same-day funding: You can choose your funding date and in many cases, get your money the same day you’re approved. LightStream is one of the fastest funders on our list Rate Beat Program: This program ensures you get a lower rate than from any qualified competing lender. LightStream is the only lender on our list who offers a low-rate guarantee Loan Experience Guarantee: If you’re not completely satisfied with your online loan experience with LightStream, fill out a questionnaire within 30 days and they’ll pay you $100 Cons Loan terms vary: Maximum loan terms vary by use (home improvement, boat, RV and aircraft loans go up to 12 years; other uses go up to seven years) Must have good to excellent credit: LightStream lends only to borrowers with good or excellent credit (score above 670) so if you have a so-so credit history, skip this lender No pre-qualification: LightStream doesn’t offer a soft-pull pre-qualification, so to see your rate you’ll have to start a full application
LightStream Interest Rates
LightStream delivers competitive interest rates on personal loans, generally being lower than many competing lenders. The specific interest rate you qualify for will depend on your credit report, loan amount and loan termand to get the best rates, you’ll need to have excellent credit and set up AutoPay.
LightStream has a Rate Beat Program that promises to beat any competitor’s rate by 0.1 percentage point if you meet certain requirements. The loan amounts available through LightStream start at $5,000 and go up to $100,000. Terms can be as short as two years or as long as 12 years depending on what type of loan you take out.
SoFi
BEST DISCOUNTS
4.4
Interest Rate (APR)8.99% to 29.49%Term Options24 months to 84 monthsLoan Size Offered$5k to $100k
SoFi Overview
SoFi is an online lender best known for its excellent customer service and user-friendly online platform. It offers unemployment protection and career coaching services to borrowers, which can add a layer of reassurance if you can’t make your payments for reasons beyond your control.It also offers referral bonuses and travel incentives to round out its membership benefits. Its lowest rate, 8.99% APR, is the highest on the list, but its top rate, 29.49% APR, is more competitive.
Pros and Cons of SoFi
Pros Same-day funding available: Thanks to SoFi’s technology platform, approval and funding are the fastest offered on our list Unemployment protection: Lose your job and SoFi will defer your payments in 3-month increments for up to a year and provide career coaching assistance Quick rate check: Check your rate without affecting your credit score (soft-pull) So many discounts: Autopay (0.25%) and direct deposit (0.25%) discounts, along with a discount if your funds directly pay off a creditor (0.25%) and another discount if you have multiple loans with SoFi (0.125%). SoFi offers the most discounts of any lender we recommend Cons Origination fees for best rates: You’ll have origination fees of up to 6% if you want the lowest rates, putting SoFi among only three lenders with origination fees on this list $5,000 minimum loan amount: This is the lowest minimum of our recommended lenders Highest minimum APR on our list: Even with discounts, SoFi’s minimum APR is 8.99%, a point and a half higher than our lowest lenders
SoFi Interest Rates
While SoFi’s minimum interest rate, 8.99% APR, is the highest of any lender we recommend, even with multiple discounts factored in, SoFi does offer many attractive features for borrowers including loan deferral and job assistance if you lose your job, plus a super fast application and approval process.
You may be eligible for a 0.25% autopay discount if you have your loan payments automatically deducted from your bank account. You can also qualify for an additional 0.25% direct deposit discount if you have a SoFi checking or savings account that receives at least $1,000 in monthly direct deposits. If you use Direct Pay to use your loan to pay creditors directly, you’ll qualify for another 0.25% discount and if you have more than one SoFi loan you can qualify for a minimum 0.175% discount there.
Loan amounts for SoFi personal loans range from $5,000 to $100,000, and repayment terms are between two and seven years. You can check your potential interest rate on SoFi’s website without affecting your credit score.
PenFed Credit Union
BEST FOR SMALL LOANS
4.3
Interest Rate (APR)8.99% to 17.99%Term Options12 months to 60 monthsLoan Size Offered$600 to $50k
PenFed Overview
While many lenders set their minimum loan amounts at $1,000, Pentagon Federal Credit Union (PenFed), the second-largest credit union in the country, has loan amounts starting at just $600.
You don’t need to be a PenFed member to apply for a loan. If you are approved, PenFed will automatically create a membership in the form of a savings account funded with $5, so you’ll be eligible for all the benefits of membership such as member discounts and financial assistance programs. PenFed membership is open to any U.S. citizen or permanent resident — not just military members.
Pros and Cons of PenFed
Pros Competitive interest rates: PenFed offers the lowest maximum APR of 17.99% on our list Online friendly: Available in all 50 states and you can apply online without visiting a branch Co-borrowers allowed: If you can’t qualify for a loan on your own you can add a co-borrower Small loan: The minimum loan limit is $600, the lowest offered of all recommended borrowers Cons No discounts: PenFed doesn’t offer autopay or direct deposit discounts like the majority of lenders on this list Limited physical branch locations: PenFed has physical branches in only a handful of states Loan amounts max out at $50,000: This is one of the lower maximums on our list
PenFed Interest Rates
Interest rates for PenFed personal loans start at a competitive 8.99% with a maximum of 17.99% APR, the lowest maximum on the list. Loan amounts vary from $600 to $50,000 with terms from 12 to 60 months. PenFed doesn’t advertise any discounts for autopay or paying from a PenFed checking account.
Upstart
BEST OR BAD CREDIT
4.0
Interest Rate (APR)7.80% to 35.99%Loan Size Offered$1K to $50KMinimum Credit Score300
Upstart Overview
Upstart uses artificial intelligence to evaluate your creditworthiness and decide if you qualify for a low-interest personal loan. According to its site, 87% of its loan approvals are fully automated, helping you get a lightning-fast decision. What’s more, you only need a credit score of 300 to qualify.
Upstart’s APRs, ranging from 7.80% to 35.99% APR as of this writing, are both the lowest and highest APRs on our list, so your actual rate may vary widely.
Pros and Cons of Upstart
Pros Fast loan approvals and funding: Most borrowers are approved within the same day, making Upstart among the fastest approvers and funders we recommend Soft credit check: Get preapproved and check your rate with no impact on your credit score Accepts credit scores as low as 300: Because Upstart uses your education and work history in addition to your credit score to qualify you, they’re designed for borrowers with lower credit scores Available in all 50 states: Upstart’s online technology platform is accessible across the country, but some states have more stringent loan requirements Cons High origination fees: Origination fees range from 0% to 12% with Upstart, the highest maximum fees among recommended lenders High interest rates for some borrowers: Upstart’s maximum APR is 35.99%, the highest on our list No loans over $50,000: Several of our recommended lenders lend up to $100,000. Limited repayment terms: Upstart offers only two term options to pay your loan back — three and five years
Upstart Interest Rates
Upstart has the widest range of interest rates of any of our recommended lenders, 7.80% to 35.99% APR, with some rates being higher or lower than the competition depending on your credit profile.It can be a good low-interest personal loan option if you have a low credit score, as Upstart uses your education and employment in addition to your financial background to determine your personal loan eligibility. Its minimum credit score requirement is 300.
Upstart loan amounts generally go from $1,000 to $50,000, but minimums vary by state. You can get a loan term of three or five years. Upstart does not offer interest rate discounts or matching offers, but it does provide soft credit checks for rate estimates.
U.S. Bank
BEST FOR LOYAL CUSTOMERS
4.0
Interest Rate (APR)8.74% to 24.99%Term Options12 months to 60 months (for non-customers)Size Offered$1k to $50k
U.S. Bank Overview
U.S. Bank accepts lower credit scores and grants higher loan limits to existing U.S. Bank customers, so you have more options as a customer. Its personal loans don’t have origination fees or prepayment penalties. And because they’re unsecured personal loans, no collateral is ever required.
Loans range from $1,000 to $50,000 for customers (up to $25,000 for non-customers) with repayment terms of 12 to 84 months (12 to 60 months for non-customers) and 8.74% to 24.99% APR.
Pros and Cons of U.S. Bank
Pros No fees: U.S. Bank doesn’t charge origination or prepayment fees Autopay discount: Get a 0.50% rate discount for automatic payments Customers benefit: Current U.S. Bank customers can borrow up to $50,000 and repay the loan over 84 months, the second-longest repayment term of recommended lenders Cons Bad terms for non-customers: Borrow just $25,000 as a non-customer, the lowest amount on our list, with a 60-month or 84-month repayment term Longer funding times: If you’re not a customer, funding can take 1 to 4 business days
U.S. Bank Interest Rates
U.S. Bank’s interest rates range from 8.74% to 24.99% APR, middle-of-the-range on this list. You’ll get the best rates with a loan of $10,000 or higher combined with a credit score of 800 and automatic payments (which offer a 0.50% discount).
If you’re a current U.S. Bank customer, you need a minimum credit score of 660 to be eligible for a personal loan. Terms range from one year to seven years, and amounts go from $1,000 to $50,000.
If you’re not a current U.S. Bank customer, you need a credit score of 720 or higher to qualify. The maximum loan you can take out is $25,000, and terms range from one to five years.
Upgrade
BEST SECURED LOANS
3.9
Interest Rate (APR)9.99% to 35.99%Term Options24 months to 84 monthsLoan Size Offered$1k to $50k
Upgrade Overview
Upgrade is a lending marketplace known for offering both unsecured and secured loans (backed by collateral like a car or boat) to customers. Loans range from $1,000 to $50,000 with APRs ranging from a high 9.99% to 35.99% and repayment terms ranging from two to seven years.
Upgrade provides several discounts, including for autopay and direct repayment to debtors. The platform’s straightforward online application process, quick funding (often within one business day) and educational resources make it a convenient personal loan option.
Pros and Cons of Upgrade
Pros Discounts and bonuses: Upgrade offers an autopay discount, secured loan discount, repayment to debtor discount and also a welcome bonus of up to $200 Soft-pull pre-qualification: You can check your rates with no impact on your credit score Offers secured and unsecured loans: You’re offered multiple secured and unsecured options when you check your rate. A secured loan generally offers a lower interest rate than an unsecured loan since you’re putting up something of value to back your loan Cons High fees: Origination fees from 1.85%, the highest minimums on our list, up to 9.99%, apply and are taken out of your loan proceeds, reducing the amount of your loan Credit scores not disclosed: Upgrade doesn’t disclose its minimum credit score requirements Limited information available on website: You may not be able to find specific, detailed information on Upgrade’s website, like exactly what the rate discount is for autopay
Upgrade Interest Rates
Upgrade’s minimum APR, 9.99%, is the second highest on our list. To get that rate, you’ll need to sign up for automatic payments and have all or part of your funds paid directly to creditors. It also has a welcome bonus for new customers, where you’re paid $200 when you open a Rewards Checking Plus account with your loan application and have at least $1,000 in direct deposits within 45 days of opening. For the lowest interest rates, in addition to signing up for discounts, choose a secured loan option.
Wells Fargo
BEST FOR IN-PERSON SERVICE
4.0
Interest Rate (APR)7.49% to 24.99%Term Options12 months to 84 monthsLoan Size Offered$3k to $100k
Wells Fargo Overview
Many personal loan lenders operate online. But Wells Fargo has physical branches nationwide where you can talk to someone face-to-face if you need help. With decent rates of 7.49% to 24.99% (with a 0.25% relationship discount included) and generous payback terms of one to seven years, it’s a solid option if you like dealing with a traditional bank for your personal loan.
Pros and Cons of Wells Fargo
Pros No fees: Wells Fargo doesn’t charge origination or prepayment fees, although it may charge a late fee of $39 Relationship discounts for existing customers: Get a 0.25% to a 0.50% discount when you set up autopay from your Wells Fargo checking account. The amount of your discount depends on the type of checking account you have Extensive branch network: Wells Fargo has thousands of branches across the country, the most of any lender on the list Pre-qualify: They offer the option to check rates with a soft credit inquiry that doesn’t impact your credit score Cons Only customers can apply: You must be an existing Wells Fargo customer of a year or more to get a loan Online applications limited: An in-person application may be required, the only lender we recommend with this caveat No cosigners: Wells Fargo allows joint applications, but doesn’t allow cosigners on your loan
Wells Fargo Interest Rates
Wells Fargo gives a rate discount of 0.25% to 0.50% if you enroll in automatic payments from a Wells Fargo checking account. Loan amounts vary from $3,000 to $100,000, and loan terms vary. With a loan under $5,000, loan terms are one to three years, and larger loans qualify for terms from from one to seven years. Only current customers of 12 months or more can get a Wells Fargo personal loan, so you’ll need to open a bank account and wait a bit if you don’t have one already.
Compare the Best Low-Interest Personal Loans
Filters
Minimum Credit Score
300-680
4.4 Interest Rate (APR)6.99% to 25.49% What Stands OutWill beat competitor offers by 0.10% Loan Size Offered$5K to $100K Minimum Credit ScoreN/A |
4.4 Interest Rate (APR)8.99% to 29.49% What Stands OutPays off creditors directly up to $100K Loan Size Offered$5K to $100K Minimum Credit Score680 |
Interest Rate (APR)8.99% to 17.99% What Stands OutNo origination fees Loan Size Offered$600 to $50K Minimum Credit Score550 |
4.1 Interest Rate (APR)7.99% to 24.99% What Stands OutFully U.S.-based customer service Loan Size Offered$2.5K to $40K Minimum Credit Score660 |
4.0 Interest Rate (APR)7.80% to 35.99% What Stands OutOffers for low- or no-credit borrowers Loan Size Offered$1K to $50K Minimum Credit Score300 |
4.0 Interest Rate (APR)8.74% to 24.99% What Stands OutOffers money within hours for existing bank customers Loan Size Offered$1K to $50K Minimum Credit Score660 |
3.9 Interest Rate (APR)9.99% to 35.99% What Stands OutSecured loan offer Loan Size Offered$1K to $50K Minimum Credit Score620 |
4.0 Interest Rate (APR)7.49% to 23.24% What Stands OutIn-person service at 4,500+ branches Loan Size Offered$3K to $100K Minimum Credit ScoreN/A |
| Loan Provider | Interest Rate (APR) | What Stands Out | Loan Size Offered | Minimum Credit Score | Visit Site | See More |
|---|---|---|---|---|---|---|
| 6.99% to 25.49% | Will beat competitor offers by 0.10% | $5K to $100K | N/A | Visit Site | Get Pre-Qualifiedfrom multiple lenders on Credible’s platform | |
| 8.99% to 29.49% | Pays off creditors directly up to $100K | $5K to $100K | 680 | Visit Site | Get Pre-Qualifiedfrom multiple lenders on Credible’s platform | |
PenFed Credit UnionVisit SiteLearn More | 8.99% to 17.99% | No origination fees | $600 to $50K | 550 | Visit Site | Learn More |
| 7.99% to 24.99% | Fully U.S.-based customer service | $2.5K to $40K | 660 | Visit Site | Get Pre-Qualifiedfrom multiple lenders on Credible’s platform | |
| 7.80% to 35.99% | Offers for low- or no-credit borrowers | $1K to $50K | 300 | Visit Site | Get Pre-Qualifiedfrom multiple lenders on Credible’s platform | |
U.S. BankVisit SiteLearn More | 8.74% to 24.99% | Offers money within hours for existing bank customers | $1K to $50K | 660 | Visit Site | Learn More |
| 9.99% to 35.99% | Secured loan offer | $1K to $50K | 620 | Visit Site | Get Pre-Qualifiedfrom multiple lenders on Credible’s platform | |
Wells FargoVisit SiteLearn More | 7.49% to 23.24% | In-person service at 4,500+ branches | $3K to $100K | N/A | Visit Site | Learn More |
| Loan Provider | Interest Rate (APR) | What Stands Out | Loan Size Offered | Minimum Credit Score | Visit Site | See More |
|---|---|---|---|---|---|---|
| 6.99% to 25.49% | Will beat competitor offers by 0.10% | $5K to $100K | N/A | Visit Site | Get Pre-Qualifiedfrom multiple lenders on Credible’s platform | |
| 8.99% to 29.49% | Pays off creditors directly up to $100K | $5K to $100K | 680 | Visit Site | Get Pre-Qualifiedfrom multiple lenders on Credible’s platform | |
PenFed Credit UnionVisit SiteLearn More | 8.99% to 17.99% | No origination fees | $600 to $50K | 550 | Visit Site | Learn More |
| 7.99% to 24.99% | Fully U.S.-based customer service | $2.5K to $40K | 660 | Visit Site | Get Pre-Qualifiedfrom multiple lenders on Credible’s platform | |
| 7.80% to 35.99% | Offers for low- or no-credit borrowers | $1K to $50K | 300 | Visit Site | Get Pre-Qualifiedfrom multiple lenders on Credible’s platform | |
U.S. BankVisit SiteLearn More | 8.74% to 24.99% | Offers money within hours for existing bank customers | $1K to $50K | 660 | Visit Site | Learn More |
| 9.99% to 35.99% | Secured loan offer | $1K to $50K | 620 | Visit Site | Get Pre-Qualifiedfrom multiple lenders on Credible’s platform | |
Wells FargoVisit SiteLearn More | 7.49% to 23.24% | In-person service at 4,500+ branches | $3K to $100K | N/A | Visit Site | Learn More |
No results were found.
*APR accurate as of September 12, 2024
Best Uses for a Low-Interest Personal Loan
Personal loans can be used for a variety of reasons, including debt consolidation loans, wedding expenses or auto financing. When taking out a personal loan, it’s wise to have a clear reason, and avoid using it for discretionary spending that could lead to debt accumulation and financial strain, said Dr. Chris Courtney, cognitive neuroscientist and senior vice president of Happy Money, a personal loan lender.
Some popular reasons for personal loans include:
Debt consolidation
Consolidating debt was the top reason individuals in MarketWatch Guides team’s most recent personal loans survey took out a personal loan. Consolidating high-interest debt like credit cards into a lower-interest personal loan can help you save money on interest payments and reduce your debt more quickly, Courtney explained. “Importantly, Happy Money research has found that people with no credit card debt experience nearly 40% less financial stress than those with $1 or more.” He added that their data shows that people who use the majority of their loan proceeds to pay down debt are more than twice as likely to keep debt below $1,000 long term.
Car financing or repairs
About 18% of people surveyed by MarketWatch about their personal loan use told us they used a personal loan for car financing or repairs. While personal loan interest rates from a bank are usually a bit higher than auto loans since they’re unsecured, they can be a good option because they’re fast to apply for and you may qualify for longer terms than with a car loan. A personal loan is a solid way to finance if you’re buying a car from a private seller and need to finance it.
Home improvements
The second-most popular reason for taking out a personal loan on our survey was home improvements or renovations. While many people use a home equity loan or line of credit to finance home improvements, these secured loans take time to process and often have origination fees. Personal loans, with their fast approval processes and quick funding, allow homeowners to start their home improvement projects quickly.
Although low-interest personal loans can save you money, it’s wise to chat with a financial adviser or credit counselor first to make sure a loan is the best option for you.
How to Qualify for a Lender’s Best Rates
Without a doubt, your best bet to qualify for a lender’s best rates is to get your credit score as high as you can.
Ways you can improve your score include paying bills on time, reducing existing debt balances, and resolving any errors on your credit report, said Leslie Tayne, financial attorney and founder of Tayne Law Group. Because your payment history accounts for 35% of your FICO calculation, it’s imperative to make on-time payments every month to pay down your loans.
Tayne also recommended applying with a cosigner if the lender offers this option. “However,” she cautioned, “Be sure the co-signer is aware of their legal responsibilities and comfortable with the risks.” While a cosigner can improve your chances of getting approved or help you get a lower rate, their credit will suffer if you miss a payment.
Another way you can qualify for lower rates is to consider your repayment term. The shorter your term, the lower your rate will typically be.
Finally, consider rate discounts. Some banks and financial institutions offer 0.25% to 0.50% discounts for autopay or sending payments directly to a debtor.
Calculate Your Personal Loan Payments
Before you apply for a loan, use our personal loan calculator to see whether a personal loan is likely to fit in your monthly budget. The calculator is also a great way to see how different interest rates and terms affect your monthly payments.
If you’re not sure which interest rate to pick, you can use the national average personal loan rate – which was 12.35% in November, according to the latest data from the Federal Reserve. Keep in mind, though, that the interest rate you’ll be offered can vary based on your credit score and existing debt.
Key Considerations When Choosing a Lender
While rates are certainly important when comparing lenders, they’re not the only items to pay attention to. You’ll also want to check if the lender offers flexible repayment options, like monthly or biweekly payments or the option to adjust your due date to better fit your budget. Also, consider customer support — you’ll want a lender that’s easy to reach when you have questions. And stay away from origination fees if you can. They’re deducted directly from the amount you’re borrowing, meaning less money in your pocket.
Here’s what else to consider when choosing a bank or financial institution:
- Watch out for hidden fees, such as origination or prepayment penalties. Most of our recommended lenders don’t have origination fees and none of our recommended lenders charge prepayment penalties.
- Check the loan term: Longer terms can mean lower monthly payments but higher overall costs.
- Look for flexible repayment options that match your budget. Lenders on this list have repayment terms from one to seven years (and up to 12 years for home renovation loans).
- Read online reviews or ask friends for recommendations to gauge customer service.
- Talk to a few lenders to see who you feel most comfortable with — they should be transparent and helpful in answering your questions.
Don’t rush. Take your time to find the best low-interest personal loan for your needs.
The Bottom Line
Exploring the best low-interest personal loan options can be a game-changer for your finances. It means paying less in interest, which can save you money in the long run. If you’re considering getting a personal loan, take a moment to explore the top lenders on this list. Responsible borrowing is key to reaching your financial goals, and with these cost-effective loans, you’re one step closer to achieving them.
>> Related:Best Personal Loans
Recap of Our Picks for the Best Low-Interest Personal Loans
- Discover Personal Loans Review: Our top pick
- LightStream Personal Loans Review: Best guarantees
- SoFi Personal Loans Review: Best discounts
- PenFed Credit Union Personal Loans: Best for small loans
- Upstart Personal Loans Review: Best for bad credit
- U.S. Bank Personal Loans Review: Best for loyal customers
- Upgrade Personal Loans Review: Best secured loans
- Wells Fargo Personal Loans: Best for in-person service
Frequently Asked Questions About Low-Interest Personal Loans
Improving your credit score is the first step to getting the lowest interest rate on a personal loan. You can do this by paying all of your bills on time and reducing your total debt amount. Also request a free credit report from Experian, TransUnion and Equifax (you get one free report each year) to make sure there are no errors on your credit history. You can also get lower rates if you choose a loan with a shorter repayment term. If you add a cosigner with better credit than you to your loan application, you may be able to get a lower rate.
Getting a 0% interest personal loan is extremely rare and typically reserved for promotional offers from specific lenders. These offers are usually limited to borrowers with excellent credit scores and may come with strict terms and conditions, such as a short repayment period or limited loan amount. So while it’s technically possible, it’s not very probable.
The average APR for a 24-month personal loan is currently 12.35%, according to the most recent Federal Reserve data. Anything below this average would be considered a good APR on a personal loan. Rates will vary based on your credit score, financial stability, the lender you choose and your loan terms, but currently, our recommended lenders are offering rates from 6.99% to 35.99% APR.
Payday loans and similar high-interest loans may be easier to get but often come with steep fees and interest rates that make them predatory in nature. Instead of taking on a risky loan, work on improving your chances of getting approved for a more affordable personal loan. This could include working on building a good credit history, stabilizing your income and getting a co-signer if needed.
Methodology: Our System for Ranking the Best Low-Interest Personal Loans
Our team put together a comprehensive100-point rating systemto evaluate personal loan companies. We gathered data points from 28 of the most prominent lenders in the US and analyzed disclosures, licensing documents, sample loan agreements, marketing materials and websites. Our rating system takes into account four broad categories.
- Affordability(35%): How expensive each company’s loans are to pay back.
- Loan features(35%): The breadth of loan terms and features available to prospective customers.
- Customer experience(20%): Ease of application, prequalification and customer service interactions.
- Company reputation(10%): An exploration of lenders’ Better Business Bureau files, customer reviews and outstanding regulatory actions.
Our top-rated lenders may not be the best fit for all borrowers. To learn more,read ourfull personal loans methodology.
If you have feedback or questions about this article, please email the MarketWatch Guides team at editors@marketwatchguides.com.
