Our goal at Credible Operations, Inc., NMLS Number 1681276, hereafter referred to as “Credible”, is to give you the tools and confidence you need to improve your finances. Although we promote the products of our partner lenders who pay us for our services, all opinions are our own.
A personal loan can help cover almost any expense. Whether you need a loan to consolidate debt, pay a medical bill, or finance a home improvement project, now might be the time to borrow money when interest rate are weak. Depending on your credit and finances, and the type of loan you choose, you may be able to save money on interest charges and reduce your overall cost of borrowing.
Visit Credible for view your prequalified personal loan rates from various lenders, all in one place.
What are the current personal loan rates?
The table below shows the prequalified average Personal loan rates for borrowers with credit scores of 720 or higher who used the Credible Marketplace to select a lender:
For the month of June 2022:
- 3-year personal loan rates averaged 11.08%, down from 11.14% in May.
- 5-year personal loan rates averaged 13.10%, down from 13.27% in May.
How has inflation impacted personal loan rates?
The current inflation rate in the United States is 8.26%. Although it has slowed down a bit, it is still close to its highest level in 40 years. As inflation drives up the prices of goods and services, demand for credit increases, driving up interest rates for new personal loans and other financial products, such as mortgages and credit cards.
Although this benefits lenders, it means you will pay more to borrow money. If you have an outstanding loan with a fixed interest rate, your payments will not be affected. But if your loan is at a variable rate, your payments could increase.
Credible, it’s easy to compare personal loan rates from various lenders, without affecting your credit.
Average personal loan rates by credit score
Average personal loan rates can vary depending on your credit and other financial factors. The table below shows the average personal loan rates by credit score:
In June, the average prequalified rate retained by borrowers was:
- 8.26% for borrowers with credit scores of 780 or higher choosing a 3-year loan
- 30.44% for borrowers with credit scores below 600 choosing a 5-year loan
How to get a lower personal loan interest rate
Fortunately, there are steps you can take to lock in a lower interest rate and potentially save hundreds or even thousands of dollars in interest on your personal loan, including:
- Increase your credit score. The increase your credit score, the lowest rates to which you will be entitled. To improve your credit, check your credit report and dispute any errors, pay bills on time, pay off debts, and don’t open new credit accounts unless you really need to.
- Choose a shorter repayment term. In general, shorter loan repayment terms come with lower interest rates. If your monthly budget allows, apply for a shorter term of two years instead of five years, for example.
- Get a co-signer. A cosigner, who can be a family member or close friend with good credit, can help you get a lower interest rate. Remember that if you fail to repay your loan, the co-signer will be responsible.
- Compare the prices. Not all personal loans are created equal. Do your research and compare offers from several different lenders to find the most competitive rates.
With Credible, you can quickly and easily compare personal loan rates to find the one that suits your needs.