Best personal loan rates for March 2023
Mar 22, 2023
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What To Know First
Personal loans allow you to borrow a lump-sum to pay for a large expense and then pay it back over time in monthly installments. They have a couple of key factors to keep in mind when comparing options.
Personal loan interest rates currently range from about 6 percent to 36 percent. The actual rate you receive depends on multiple factors, such as your credit score, annual income and debt-to-income ratio. The best rate that you can qualify for might not be the best loan you can qualify for — consider additional features offered and the other listed factors as well.
How to apply for a personal loan
Here are a few steps to follow when applying for a personal loan:
- Determine how much you need. Calculate how much money you need and factor in any origination fees that may be deducted from you loan proceeds.
- Check your credit score. The higher your credit score, the better APR you'll receive. Consider a co-signer if you have fair or bad credit for more favorable rates.
- Get prequalified. Prequalification allows you to check your rates with multiple lenders without affecting your credit score.
- Compare rates and loan terms. Look at a variety of lenders, including banks, credit unions and online lenders to see which offers you the most competitive rates.
- Complete the application process. You’ll need to submit documents such as pay stubs, tax returns and personal identification.
How to choose the best lender
It's always best to get quotes from a few lenders before applying for a personal loan so you can determine which has the best overall offerings for your situation. When comparing lenders, keep an eye on the following factors:
- Approval requirements. Every lender has its own threshold for approving potential borrowers, considering factors like income, credit score and debt-to-income ratio. If you have below-average credit, look for lenders that utilize other approval criteria — like education and employment history — or allow co-signers.
- Interest rates. The lowest advertised rate is never guaranteed, so compare your prequalification offers. When comparing your potential interest rates, also incorporate any fees or penalties — origination fees or application fees can significantly add to the overall cost of your loan.
- Loan amounts. If you need a loan for something small, like a minor car repair, look for lenders that cater to lower amounts to avoid over borrowing. On the other side, if you need to make a big purchase you'll need to look for lenders that offer enough — and check that you can qualify for the full amount.
- Repayment options. Look for lenders that offer multiple repayment terms so you can choose the one that makes the most sense for your situation. Long repayment terms will decrease your monthly payment, but if you have a smaller loan, a shorter repayment term will cut back on the interest you pay overall.
- Unique features. Keep an eye out for lenders with any unique perks and restrictions. Also check that any lender you're considering will allow you to use your loan for the purpose you're intending.
- Customer service. Investigate a company's customer service options and read the company reviews on its Better Business Bureau and Trustpilot profiles to ensure you have the support you need as you navigate the application process and repayment. But also keep in mind that people are much more likely to leave negative reviews than positive, look for obvious negative trends but also how the company responds to them.
Check Your Personal Loan Rates
Compare personal loan rates in March 2023
| LENDER | CURRENT APR RANGE | LOAN TERM | LOAN AMOUNT | BEST FOR |
|---|---|---|---|---|
| SoFi | 7.99%-23.43% (with autopay) | 2-7 years | $5,000-$100,000 | Overall personal loan |
| LightStream | 7.99%-23.99% (with autopay) | 2-7 years | $5,000-$100,000 | Generous repayment terms |
| Avant | 9.95%-35.95% | 1-5 years | $2,000-$35,000 | People with bad credit |
| Best Egg | 8.99%-35.99% | 3-5 years | $2,000-$50,000 | Low APRs |
| Upgrade | 8.24%-35.97% (with autopay) | 2-7 years | $1,000-$50,000 | Fast funding |
| Happy Money | 10.50%-29.99% | 2 or 5 years | $5,000-$40,000 | Paying credit card debt |
| Upstart | 6.70%-35.99% | 3 or 5 years | $1,000-$50,000 | Little credit history |
| LendingClub | 8.05%-36.00% | 2-5 years | $1,000-$40,000 | Using a co-borrower |
| PenFed | 7.74%-17.99% | Up to 5 years | $600-$50,000 | Small loan amounts |
| TD Bank | 6.99%-21.99% | 1-5 years | $2,000-$50,000 | Few fees |
| PNC Bank | Varies by ZIP code | 6 months-5 years | $1,000-$35,000 | In-person banking |
| LENDER | CURRENT APR RANGE | LOAN TERM | LOAN AMOUNT | BEST FOR |
|---|---|---|---|---|
| LightStream | 7.99%-23.99% (with autopay) | 2-7 years | $5,000-$100,000 | Generous repayment terms |
| Happy Money | 10.50%-29.99% | 2 or 5 years | $5,000-$40,000 | Paying credit card debt |
| Best Egg | 8.99%-35.99% | 3-5 years | $2,000-$50,000 | Low APRs |
| SoFi | 7.99%-23.43% (with autopay) | 2-7 years | $5,000-$100,000 | Unemployment protection |
| Achieve | 7.99%-29.99% | 2-5 years | $5,000-$50,000 | Quick approval |
| PenFed | 7.74%-17.99% | Up to 5 years | $600-$50,000 | Small loan amounts |
| Upstart | 6.50%-35.99% | 3 or 5 years | $1,000-$50,000 | Little credit history |
| LendingClub | 8.05%-36.00% | 2-5 years | $1,000-$40,000 | Using a co-borrower |
| Prosper | 6.99%-35.99% | 2-5 years | $2,000-$50,000 | No prepayment penalty |
| Upgrade | 8.24%-35.97% (with autopay) | 2-7 years | $1,000-$50,000 | Fast funding |
| TD Bank | 6.99%-21.99% | 1-5 years | $2,000-$50,000 | Few fees |
| LENDER | CURRENT APR RANGE | LOAN AMOUNT | MIN. CREDIT SCORE | BEST FOR |
|---|---|---|---|---|
| Upstart | 6.50%-35.99% | $1,000-$50,000 | No minimum requirements | Little credit history |
| OneMain Financial | 18.00%-35.99% | $1,500-$20,000 | Not specified | Secured loans |
| TD Bank | 6.99%-21.99% | $2,000-$50,000 | 700 | Low rate caps |
| Avant | 9.95%-35.95% | $2,000-$35,000 | 580* | A range of repayment options |
| LendingPoint | 7.99%-35.99% | $2,000-$36,500 | 600 | Small loans |
| Upgrade | 8.24%-35.97% (with autopay) | $1,000-$50,000 | 560 | Fast funding |
| LendingClub | 8.05%-36.00% | $1,000-$40,000 | Not specified | Online experience |
*Avant's minimum credit score is 580 FICO and 550 Vantage.
For more information on bad credit loan rates, check out our page on bad credit personal loans.
| LENDER | CURRENT APR RANGE | LOAN AMOUNT | MIN. CREDIT SCORE | BEST FOR |
|---|---|---|---|---|
| SoFi | 7.99%-23.43% (with autopay) | $5,000-$100,000 | 680 | High borrowing limits |
| LendingClub | 8.05%-36.00% | $1,000-$40,000 | Not specified | Borrowing money from other investors |
| LightStream | 7.99%-23.99% (with autopay) | $5,000-$100,000 | Not specified | Borrowers who can qualify for the best rates |
| Prosper | 6.99%-35.99% | $2,000-$50,000 | 600 | Joint loans |
| Rocket Loans | 8.416%-29.99% (with autopay) | Not specified-$45,000 | Not specified | Fast funding |
| Best Egg | 8.99%-35.99% | $2,000-$50,000 | 600 | Borrowers with “okay” credit |
| Discover | 6.99%-24.99% | $2,500-$35,000 | 660 | A range of repayment terms |
| Credible | 5.40% to 35.99% (with autopay) | $600-$100,000 | Varies by lender | Borrowers who want to price shop |
| Earnest | Varies by lender | $1,000-$250,000 | 680 | Borrowers who want other factors considered in their application |
| Happy Money | 10.50%-29.99% | $5,000-$40,000 | 640 | Borrowers who want to consolidate debt |
| LENDER | CURRENT APR RANGE | LOAN TERM | LOAN AMOUNT | BEST FOR |
|---|---|---|---|---|
| Best Egg | 8.99%-35.99% | 3-5 years | $2,000-$50,000 | High-income earners with good credit |
| Happy Money | 10.50%-29.99% | 2 or 5 years | $5,000-$40,000 | Consolidating credit card debt |
| LightStream | 7.99%-23.99% (with autopay) | 2-7 years | $5,000-$100,000 | High-dollar loans and longer repayment terms |
| PenFed | 7.74%-17.99% | Up to 5 years | $600-$50,000 | Smaller loans with a credit union |
| OneMain Financial | 18.00%-35.99% | 2-5 years | $1,500-$20,000 | Fair to poor credit |
| Discover | 6.99%-24.99% | 3-7 years | $2,500-$35,000 | Good credit and next-day funding |
| Upstart | 6.50%-35.99% | 3 or 5 years | $1,000-$50,000 | Consumers with little credit history |
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What is a personal loan?
Personal loans are short- and medium-term loans that consumers can receive from banks, credit unions or private lenders like online marketplace lenders and peer-to-peer lenders. The loan funds can be used for just about any purpose, such as paying off other debt, financing a home renovation or paying for family needs, like a wedding or adoption.
A personal loan is repaid in monthly installments, similar to a car loan or home mortgage, with loan terms typically ranging from 24 months to 60 months or even longer. Personal loans are usually unsecured, meaning they are not backed by collateral such as a car, house or other assets. Approval and funding process is often faster than that of a home equity line of credit, which lets you borrow funds as you need them rather than in a lump sum.
What are current personal loan interest rates?
Personal loan interest rates, like most other costs, have gone up in the past year. Currently, you can expect to pay 6 percent to 36 percent, depending on your credit score. As of March 22, 2023, the average personal loan interest rate is 10.82 percent. The better your credit score, the more likely you are to qualify for a personal loan with the lowest interest rate available. Compare personal loan offers to see what you are eligible for before applying for a personal loan.
Average personal loan interest rates by credit rating
The interest rate you're offered is based on your credit health; namely, your score. Those with less-than-stellar credit are often seen as more 'risky' to lenders and are more likely to be offered higher rates. Borrowers with good-to-excellent credit are more eligible for the lender's most competitive rates and terms.
Before applying for a loan, make sure to prequalify or look at the lender's requirements and rates, as well as your own credit score to estimate your potential interest rate.
| CREDIT BAND | CREDIT SCORE RANGE | AVERAGE PERSONAL LOAN INTEREST RATE |
|---|---|---|
| Excellent Credit | 720-850 | 10.3%-12.5% |
| Good Credit | 690-719 | 13.5%-15.5% |
| Average Credit | 630-689 | 17.8%-19.9% |
| Bad Credit | 300-629 | 28.5%-32% |
Excellent-credit loans
Excellent-credit loans are geared toward borrowers with excellent credit scores, typically between 720 and 850. Having such a high credit score can come with many benefits, including average APRs as low as 10.3 percent — though some lenders go even lower. If your credit score falls into this range, look for excellent-credit lenders with low advertised rates and few fees.
Good-credit loans
Good-credit loans offer competitive interest rates and generally low fees. You're considered to have good credit if you have a credit score between 690 and 719, and with such a high score, you may qualify for average APRs as low as 13.5 percent. However, if you have good credit and are interested in a personal loan, shop around; you may be able to qualify for an even lower interest rate.
Fair-credit loans
If you have a fair or average credit score, it can be hard to find a personal loan that offers reasonable rates and fees. If your credit score falls between 630 and 689, your credit score is average. While this is considered a less-than-stellar score, you still may be able to qualify for a personal loan with an average APR as low as 17.8 percent. This list of the best personal loans for fair credit features lenders that cater to people with scores in the mid-600s.
Bad-credit loans
You can get approved for a loan even with bad credit, although you won't qualify for the best APRs. If your credit score is between 300 and 629, the best interest rate available could be around 28.5 percent. However, a bad-credit loan, even one with a rate close to 30 percent, is a better financial option than a payday loan. To see what rates are available, compare offers from a few bad-credit lenders.
How to improve your chances of getting approved for a personal loan
While each lender has differing eligibility requirements, there are a few things you can do across the board to increase your eligibility odds.- Prequalify. If you are unsure what interest rate you might qualify for with a lender, the easiest way to find out is by prequalifying online. Most lenders allow you to do this without hurting your credit score.
- Shop around and compare rates. Each lender offers unique features, requirements and benefits. It is always important to do your research and prequalify with a few lenders before deciding on one.
- Check your credit. Your credit score impacts the rates and lenders you will likely qualify for. Knowing where you stand can help you figure out where to look. If you have less than stellar credit, bad credit loans tend to have reasonable interest rates for low credit borrowers.
- Pay off other debts. If possible, pay down high interest debt before applying. This can increase your approval odds and can help you score better rates.
- Reduce your loan amount and repayment term. If you are able to, it may be smart to take out a smaller loan. The larger the loan you take out, the higher the interest rate is likely to be. In addition, larger loans come with longer repayment periods, which means you will pay more in interest over the life of the loan.
- Apply with a co-signer. Applying with a co-signer with strong credit history can increase your approval odds and help you qualify for a lower interest rate.
Pros and cons of personal loans
Pros:
- Personal loans come in one lump sum, usually with a fixed interest rate.
- You can get money quickly, sometimes within as little as a day, depending on the lender you choose.
- Many are unsecured loans, which means you don't need collateral like your home or car to borrow money.
- Interest rates are much lower than those of payday loans, which charge upward of 400 percent.
- Flexibility and versatility allow you to use a personal loan for almost any purchase.
- Unlike highly risky payday loans, personal loans give you a reasonable amount of time to repay the loan.
- You may have easier payments if you consolidate debt and have a single, fixed-rate monthly payment instead of several accounts to manage.
Cons:
- APRs are generally higher than those of some secured loans.
- If you have a low credit score, you might not qualify.
- Some lenders charge fees, like origination, late and prepayment fees. The lower your credit score, the more likely you are to have a lender that charges more fees.
- Some lenders don’t allow co-signers, which means you can only use your credit score and history to qualify.
- You’re adding another bill to your monthly payments, which could stretch or even break your budget.
- You can increase your overall debt if you use it to consolidate your debt but continue to spend on your credit cards.
- Personal loans often have higher monthly payments than the minimum payment on credit cards.
Common types of personal loans
There are many reasons to take out a personal loan, and with the exception of a few lenders, most allow you to use the funds for any purpose. Here are some of the most common scenarios that lead borrowers to take out a personal loan and how to find the best lender if you're in a similar situation.
How to manage a personal loan
Effectively managing a personal loan comes down to your ability to make the monthly payments. It's imperative that you understand the full responsibility and predicted repayment timeline prior to taking out the loan. If you miss the monthly payments or are unable to make them, contact the lender as soon as possible to see if any hardship payment relief options are available.
If you need a lower monthly payment, consider a longer repayment term. While it will increase the amount you'll repay over the life of the loan in interest, a longer term can take the immediate payment responsibility off of your shoulders. Regardless of your financial situation, make sure you're aware of your lender options prior to applying so you have resources and don't risk any negative credit outcomes.
Alternatives to a personal loan
If a personal loan isn't the right option for your financial situation, there are other ways to get the funds you need. Here are a few of the most popular alternatives to a personal loan.
How Fed rate hikes impacts personal loans
In order to combat inflation, the Federal Open Market Committee (FOMC) raised interest rates seven times in 2022. It has continued to raise rates in 2023 — landing at 4.75-5 percent most recently. Lenders often respond to these hikes by increasing personal loan interest rates along with the rates of other credit products.
FAQs about personal loans
Methodology
To select the top personal loan lenders, Bankrate considers 15 factors. These factors include credit requirements, APR ranges, fees, loan amounts and flexibility to account for a wide range of credit profiles and budgets. Of the 32 lenders reviewed, 12 made Bankrate's list of best personal loans. Each lender has a Bankrate rating, which consists of three categories. These categories include:
- Affordability: The interest rates, penalties and fees are measured in this section of the score. Lower rates and fees and fewer potential penalties result in a higher score.
- Availability: What the minimum loan amounts are, its eligibility requirements and loan turnaround are considered in this category.
- Customer experience: This category covers customer service hours, if online applications are available, online account access and mobile apps.