How to Qualify for Low-Interest Personal Loan Rates

by Persephone Thanatopsis · April 20, 2022

Our goal is to give you the tools and confidence you need to improve your finances. Although we receive compensation from our partner lenders, whom we will always identify, all opinions are our own. Credible Operations, Inc. NMLS # 1681276, is referred to here as “Credible.”

If you need access to cash, taking out a personal loan with a low interest rate can help you keep your overall repayment costs as low as possible.

Keep in mind that you’ll generally need good to excellent credit to qualify for the lowest rates available.

Here’s what you should know about low-interest personal loans and where to find them:

What is an interest rate?

The interest rate on a loan is essentially the fee — expressed as a percentage — that lenders charge in return for allowing you to borrow money. The lower your interest rate, the less you’ll pay on a loan over time.

Average personal loan interest rates can range from 4.99% up to 36%, depending on the lender as well as on your credit.

Tip: Before you take out a personal loan, be sure to consider how much that loan will actually cost you. This way, you can be prepared for any added expenses.

You can estimate how much you’ll pay for a loan using our personal loan calculator below.

Enter your loan information to calculate how much you could pay

Total Payment $

Total Interest $

Monthly Payment $

With a $ loan, you will pay $ monthly and a total of $ in interest over the life of your loan. You will pay a total of $ over the life of the loan.

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How credit card interest rates compare to personal loan rates

Personal loan interest rates tend to be lower compared to what you’d get with a credit card. As of March 2022, the overall average rate for personal loans was 9.09% — lower than the average credit card interest rate of 16.44%, according to the Federal Reserve.

This means that if you need to borrow money, you’ll likely pay less in interest with a personal loan than you would with a credit card.

Tip: Some credit cards offer a 0% APR introductory period — which means you could avoid paying interest if you can repay your balance before this period ends. However, if you can’t pay off the card in time, you could stick with some hefty interest charges.

If you need to make a large purchase, it might be a better idea to rely on a personal loan instead as you’ll likely get a lower interest rate.

How to qualify for low-interest personal loans

You’ll typically need good to excellent credit to qualify for a low-interest personal loan. A good credit score is usually considered to be 700 or higher.

Credit score ranges	Credit rating
Below 640	Poor
640 to 699	Fair
700 to 749	Good
750 and up	Excellent

Keep in mind: Several lenders also offer personal loans for poor or fair credit — however,these loans tend to come with higher interest rates compared to good credit loans.

How to compare personal loan lenders

To have the best chance of finding an optimal rate, it’s important to take the time to shop around and consider as many personal loan lenders as possible.

In addition to interest rates, here are some other important factors to keep in mind as you weigh your options:

Loan amounts: You can generally borrow $600 up to $100,000 (or more) with a personal loan, depending on the lender. Be sure to borrow only what you need to keep your future repayment costs manageable.
Repayment terms: Personal loan repayment terms typically range from one to seven years, depending on the lender. While choosing a longer term could get you a lower monthly payment, it’s usually best to choose the shortest term you can afford to keep your interest costs as low as possible. Additionally, many lenders offer better rates to borrowers who opt for shorter terms.
Fees: Some lenders charge fees on personal loans (such as origination or late fees), which can increase your overall loan costs. Note that if you take out a personal loan with one of Credible’s partner lenders, you won’t have to worry about prepayment penalties.
Discounts: In some cases, you might be able to take advantage of rate discounts, which can help you save money on your loan. For example, many lenders offer rate discounts to borrowers who sign up for automatic payments — typically 0.25%. And other lenders provide discounts to existing account holders who also take out a personal loan with them.
Time to fund: If you’re approved, you can typically expect to get your personal loan funds within one week — though some lenders will fund loans as soon as the same or next business day after approval. Keep in mind that online lenders tend to offer faster funding compared to banks and credit unions.

If you’re ready to apply for a personal loan, remember to consider as many lenders as you can to find the right loan for your needs. Credible makes this easy — you compare your prequalified rates from our partner lenders in the table below in two minutes.

Lender	Fixed rates	Loan amounts	Min. credit score	Loan terms (years)
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	9.95% – 35.99% APR	$2,000 to $35,000^**	550	2, 3, 4, 5*
Fixed APR: 9.95% – 35.99% APR Variable APR: N/A Min. credit score: 550 Loan amount: $2,000 to $35,000** Loan terms (years): 2, 3, 4, 5* Time to fund: As soon as the next business day (if approved by 4:30 p.m. CT on a weekday) Fees: Origination fee Discounts: Autopay Eligibility: Available in all states except CO, IA, HI, VT, NV NY, WV Customer service: Phone, email Soft credit check: Yes Loan servicer: Avant Loan Uses: Debt consolidation, emergency expense, life event, home improvement, and other purposes Min. Income: $1,200 monthly
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	6.79% – 17.99% APR	$10,000 to $50,000	700	3, 4, 5, 6
Fixed APR: 6.79% – 17.99% APR Variable APR: N/A Min. credit score: 700 Loan amount: $10,000 to $50,000 Loan terms (years): 3 to 6 Time to fund: Next business day Fees: No prepayment penalty Discounts: None Eligibility: Available in all 50 states Customer service: Phone Soft credit check: Yes Min. Income: Does not disclose Loan Uses: Debt consolidation, home improvement, self-employment, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	4.99% – 35.99% APR	$2,000 to $50,000	600	2, 3, 4, 5
Fixed APR: 4.99% – 35.99% APR Variable APR: N/A Min. credit score: 600 Loan amount: $2,000 to $50,000 Loan terms (years): 2, 3, 4, 5 Time to fund: As soon as 1 – 3 business days after successful verification Fees: Origination fee Discounts: None Eligibility: Available in all states except DC, IA, VT, and WV Customer service: Phone Soft credit check: Yes Loan servicer: Best Egg and Blue Ridge Bank Min. Income: None Loan Uses: Credit card refinancing, debt consolidation, home improvement, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	5.99% – 24.99% APR	$2,500 to $35,000	660	3, 4, 5, 6, 7
Fixed APR: 5.99% – 24.99% APR Min. credit score: 660 Loan amount: $2,500 to $35,000 Loan terms (years): 3, 4, 5, 6, 7 Time to fund: As soon as the next business day after acceptance Fees: Late fee Discounts: None Eligibility: Available in all 50 states Customer service: Phone Soft credit check: Yes Loan Uses: Auto repair, credit card refinancing, debt consolidation, home remodel or repair, major purchase, medical expenses, taxes, vacation, and wedding
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	7.99% – 29.99% APR	$10,000 to $50,000	Not disclosed by lender	2, 3, 4, 5
Fixed APR: 7.99% – 29.99% APR Min. credit score: Does not disclose Loan amount: $10,000 to $50,000 Loan terms (years): 2, 3, 4, 5 Time to fund: As soon as 2 business days Fees: Origination fee Discounts: No Eligibility: Available in all states except CO, CT, HI, KS, NH, NY, ND, OR, VT, WV, WI, and WY Customer service: Phone Soft credit check: Yes Min. Income: None Loan Uses: Debt consolidation, home improvement, wedding, travel, medical expenses, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	7.04% – 35.89% APR	$1,000 to $40,000	600	3, 5
Fixed APR: 7.04% – 35.89% APR Min. credit score: 600 Loan amount: $1,000 to $40,000 Loan terms (years): 3, 5 Time to fund: Usually takes about 2 days^† Fees: Origination fee Discounts: None Eligibility: Available in all 50 states Customer service: Phone, email Soft credit check: Yes Loan servicer: LendingClub Bank Min. Income: None Loan Uses: Debt consolidation, paying off credit cards, home improvement, pool loans, vacations, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	9.99% – 35.99% APR	$2,000 to $36,500	580	2, 3, 4
Fixed APR: 9.99% – 35.99% APR Min. credit score: 580 Loan amount: $2,000 to $36,500 Loan terms (years): 2, 3, 4 Time to fund: As soon as the next business day Fees: Origination fee Discounts: Autopay Eligibility: Available in all states except NV and WV Customer service: Phone, email Soft credit check: Yes Min. Income: $20,000 Loan Uses: Home improvement, consolidate debt, credit card refinancing, relocate, make a large purchase, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	3.49% – 19.99% APR	$5,000 to $100,000	660	2, 3, 4, 5, 6, 7 (up to 12 years for home improvement loans)
Fixed APR: 3.49% – 19.99% APR Min. credit score: 660 Loan amount: $5,000 to $100,000 Loan terms (years): 2, 3, 4, 5, 6, 7* Time to fund: As soon as the same business day Fees: None Discounts: Autopay Eligibility: Available in all states except RI and VT Customer service: Phone, email Soft credit check: No Loan servicer: LightStream Min. Income: Does not disclose Loan Uses: Credit card refinancing, debt consolidation, home improvement, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	6.99% – 19.99% APR¹	$3,500 to $40,000²	660 (TransUnion FICO®️ Score 9)	3, 4, 5, 6, 7
Fixed APR: 6.99% – 19.99% APR¹ Min. credit score: 660 (TransUnion FICO®️ Score 9) Loan amount: $3,500 to $40,000² Loan terms (years): 3, 4, 5, 6 Time to fund: Many Marcus customers receive funds in as little as three days Fees: None Discounts: Autopay Eligibility: Available in all 50 states Customer service: Phone Soft credit check: Yes Loan servicer: Goldman Sachs Min. Income: $30,000 Loan Uses: Credit card refinancing, debt consolidation, home improvement, major purchase, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	18.0% – 35.99% APR	$1,500 to $20,000	None	2, 3, 4, 5
Fixed APR: 18.0% – 35.99% APR Min. credit score: None Loan amount: $1,500 to $20,000 Loan terms (years): 2, 3, 4, 5 Time to fund: As soon as the same day, but usually requires a visit to a branch office Fees: Origination fee Discounts: None Eligibility: Must have photo I.D. issued by U.S. federal, state or local government Customer service: Phone, email Soft credit check: Yes Min. Income: Does not disclose
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	5.99% – 24.99% APR	$5,000 to $40,000	600	2, 3, 4, 5
Fixed APR: 5.99% – 24.99% APR Min. credit score: 600 Loan amount: $5,000 to $40,000 Loan terms (years): 2, 3, 4, 5 Time to fund: As soon as 2 – 5 business days after verification Fees: Origination fee Discounts: None Eligibility: Available in all states except MA, NV, and OH Customer service: Phone, email, chat Soft credit check: Yes Min. Income: None Loan Uses: Debt consolidation and credit card consolidation only
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	4.99% – 17.99% APR	$600 to $50,000 (depending on loan term)	660	1, 2, 3, 4, 5
Fixed APR: 4.99% – 17.99% APR Min. credit score: 660 Loan amount: $600 to $50,000* Loan terms (years): 1, 2, 3, 4, 5 Time to fund: 2 to 4 business days after verification Fees: None Discounts: None Eligibility: Does not disclose Customer service: Phone, email Soft credit check: No Min. Income: Does not disclose Loan Uses: Debt consolidation, home improvement, transportation, medical, dental, life events
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	6.95% – 35.99% APR	$2,000 to $40,000	640	3, 5
Fixed APR: 6.95% – 35.99% APR Min. credit score: 640 Loan amount: $2,000 to $40,000 Loan terms (years): 3, 5 Time to fund: As soon as one business day Fees: Origination fee Discounts: None Eligibility: Available in all states except IA, ND, WV Customer service: Phone, email Soft credit check: Yes Min. Income: None Loan Uses: Debt consolidation, home improvement, vehicles, small business, new baby expenses, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	6.99% – 21.78% APR¹⁰	$5,000 to $100,000	Does not disclose	2, 3, 4, 5, 6, 7
Fixed APR: 6.99% – 21.78% APR¹⁰ Min. credit score: Does not disclose Loan amount: $5,000 to $100,000 Loan terms (years): 2, 3, 4, 5, 6, 7 Time to fund: 3 business days Fees: None Discounts: Autopay Eligibility: Available in all states except MS Customer service: Phone, email Soft credit check: Yes Min. Income: Does not disclose Loan Uses: Solely for personal, family, or household uses
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	8.93% – 35.93% APR⁷	$1,000 to $50,000	560	3 to 5 years ⁸
Fixed APR: 8.93% – 35.93% APR⁷ Min. credit score: 560 Loan amount: $1,000 to $50,000 Loan terms: 3 to 5 years ⁸ Time to fund: Within one day, once approved⁹ Loan types: Debt consolidation, pay off credit cards, home improvements, unexpected expenses, home and auto repairs, weddings, and other major purchases Fees: Origination fee Discounts: Autopay Eligibility: A U.S. citizen or permanent resident; not available in DC, SC, WV Customer service: Phone, email Soft credit check: Yes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	5.94% – 35.97% APR	$1,000 to $50,000	560	2, 3, 5, 6
Fixed APR: 5.94% – 35.97% APR Min. credit score: 560 Loan amount: $1,000 to $50,000* Loan terms (years): 2, 3, 5, 6 Time to fund: Within a day of clearing necessary verifications Fees: Origination fee Discounts: Autopay Eligibility: Available in all states except West Virginia Customer service: Email Soft credit check: Yes Min. Income: Does not disclose Loan Uses: Debt consolidation, credit card refinancing, home improvement, and other purposes
Credible Rating Credible lender ratings are evaluated by our editorial team with the help of our loan operations team. The rating criteria for lenders encompass 78 data points spanning interest rates, loan terms, eligibility requirement transparency, repayment options, fees, discounts, customer service, cosigner options, and more. Read our full methodology.	4.37% – 35.99% APR⁴	$1,000 to $50,000⁵	580	3 to 5 years⁴
Fixed APR: 4.37% – 35.99% APR⁴ Min. credit score: 580 Loan amount: $1,000 to $50,000⁵ Loan terms (years): 3 to 5 years⁴ Time to fund: As fast as 1 business day⁶ Fees: Origination fee Discounts: None Eligibility: Available in all 50 states Customer service: Phone, email Soft credit check: Yes Min. Income: $12,000 Loan Uses: Payoff credit cards, consolidate debt, take a course or bootcamp, relocate, make a large purchase, and other purposes
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All APRs reflect autopay and loyalty discounts where available \| LightStream disclosure \| ¹⁰SoFi Disclosures \| Read more about Rates and Terms

How to qualify for a low-interest rate with poor credit

While you’ll need good to excellent credit to get approved by most personal loan lenders, others specialize in working with borrowers who have poor or fair credit — so if you have bad credit, you might still be able to qualify for a personal loan.

However, the trade-off is that your interest rate on one of these loans will likely be higher compared to the rates offered to borrowers with good credit. Lenders view borrowers with bad credit as a riskier investment, so they charge higher rates to compensate for the possibility that you might default on the loan.

Tip: If you have less-than-stellar credit and are struggling to get approved, consider applying with a creditworthy cosigner to improve your chances. Not all lenders allow cosigners on personal loans, but some do.

Even if you don’t need a cosigner to qualify, having one could get you a lower interest rate than you’d get on your own. Just keep in mind that because your cosigner is equally responsible for the loan, they’ll be on the hook if you don’t make your payments.

Check Out: Bad Credit Loans

How to increase your credit score

If you’d like to increase your credit score to qualify for better rates in the future, here are a few potential strategies to consider:

Check your credit

When you apply for a personal loan, the lender will review your credit to determine if you qualify and what your rate will be — so it’s a good idea to check your credit beforehand to see where you stand.

You can use a site like AnnualCreditReport.com to review your credit reports for free. If you find any errors, dispute them with the appropriate credit bureau — Experian, TransUnion, or Equifax — to potentially boost your score.

Pay all your bills on time

Your payment history is one of the biggest components of your credit score. Just one late payment could severely damage your score, especially if you’re more than 30 days late. Additionally, negative information like late payments can stay on your credit report for up to seven years.

If you want to improve your credit, it’s critical to pay all of your bills on time.

Tip: Setting up calendar reminders or automatic payments for loans and credit cards could help you avoid missing payments. If you can’t make a payment, be sure to contact your creditor about payment relief options as soon as possible.

Pay down credit card balances

Credit utilization is another major factor of your credit score — this is the amount you owe on revolving credit lines (like credit cards and lines of credit) compared to your credit limits.

To calculate your credit utilization ratio:

Add up your credit card limits.
Add up your credit card balances.
Dividing your total balances by your total credit limits.
Multiplying this number by 100 to get your percentage.

In general, it’s a good idea to keep your utilization below 30% to prevent damage to your credit score. If you have balances on your credit cards, consider paying them down as much as possible to reduce your credit utilization and improve your score.

Avoid new loans when possible

Applying for several loans with multiple hard credit inquiries in a short period of time can also have a negative impact on your credit score. Additionally, hard credit pulls can stay on your report for up to two years. Because of this, it’s a good idea to apply for loans only when you need them.

Tip: If you know you’re going to apply for a personal loan or another type of loan, try to keep applications for other loans and credit cards to a minimum to prevent any potential drops in your credit score.

However, it’s still a good idea to shop around and compare your rates from multiple lenders before actually applying for a loan. Many lenders allow you to see your personalized rates with just a soft credit pull that won’t hurt your credit — for example, you can see your prequalified rates from Credible’s partner lenders with no impact on your credit score.

Learn More: What Credit Score Do I Need to Take Out a Personal Loan?

Is a personal loan right for me?

A personal loan can be used for almost any type of personal expense, such as consolidating debt, covering wedding costs, or paying for medical procedures.

Ultimately, whether a personal loan is right for you will depend on your individual financial circumstances. And remember that by taking advantage of a low-interest personal loan, you can keep your repayment costs as low as possible.

Tip: Remember that you’ll generally need good to excellent credit to qualify for the lowest rates available. Also be sure to shop around and compare your options from as many lenders as possible to find the most optimal rate for your needs.

Credible makes it easy to compare your personal loan options. You can see your prequalified rates from multiple lenders in two minutes — without affecting your credit.

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About the author

Taylor Medine

Taylor Medine is a Credible authority on personal finance. Her work has been featured on Bankrate, Experian, The Balance, Business Insider, Credit Karma, and more. She’s also the author of The 60-Minute Money Plan, a self-published intro to budgeting guide for people who hate budgeting.

Home » All » Personal Loans » How to Qualify for Low-Interest Personal Loan Rates

How to Qualify for Low-Interest Personal Loan Rates

What is an interest rate?

How credit card interest rates compare to personal loan rates