As of January 2025, the average interest rate for personal loans stands at 25.85%. This figure is derived from data collected over four weeks, analyzing rates quoted by 17 lenders to about 72,000 potential borrowers.
While 25.85% is the average rate, the rate you receive could be higher or lower depending on several factors, such as your credit score, financial stability, and the loan terms. Personal loan interest rates can vary significantly, with APRs ranging from as low as 5.99% to as high as 295%. However, most lenders tend to cap their APRs below 36%.
Below is a breakdown of the average rates offered by some major lenders, as well as the typical loan amounts and terms:
| Lender | Average APR | Average Loan Term (Months) | Average Loan Amount |
|---|---|---|---|
| Achieve | 22.78% | 42.0 | $29,319 |
| Avant | 29.27% | 40.3 | $13,995 |
| Best Egg | 26.07% | 47.0 | $15,459 |
| Citibank | 13.57% | 37.6 | $19,432 |
| Happy Money | 14.65% | 40.8 | $15,255 |
| LendingClub | 15.55% | 45.1 | $19,874 |
| LendingPoint | 26.33% | 43.9 | $14,172 |
| LightStream | 12.63% | 80.2 | $27,262 |
| Mariner Finance | 31.93% | 31.7 | $5,791 |
| OneMain | 30.66% | 45.0 | $8,582 |
| Prosper | 23.89% | 46.6 | $17,402 |
| SoFi | 15.29% | 50.2 | $33,425 |
| Upgrade | 23.03% | 47.1 | $18,313 |
| Upstart | 30.49% | 49.0 | $7,415 |
| Zable | 23.72% | 43.3 | $7,434 |
Personal Loan APRs Based on Credit Score
Interest rates for personal loans also vary depending on your credit score. Here’s a breakdown of the average APRs across different credit tiers:
| Credit Tier | Average APR (Dec 2024) | Average APR (Jan 2025) | Change |
|---|---|---|---|
| Excellent | 22.27% | 21.86% | -0.41% |
| Good | 27.04% | 26.89% | -0.15% |
| Fair | 31.19% | 30.17% | -1.02% |
| Poor | 30.95% | 31.38% | +0.43% |
| All Tiers | 26.25% | 25.85% | -0.40% |
Advertised Personal Loan APR Ranges
Different lenders offer a wide range of APRs for personal loans. Below is a table showing the minimum and maximum APRs for several lenders:
| Lender | Min APR | Max APR |
|---|---|---|
| Achieve | 8.99% | 29.99% |
| Best Egg | 6.99% | 35.99% |
| Avant | 9.95% | 35.99% |
| LendingClub | 8.91% | 35.99% |
| SoFi | 8.99% | 29.49% |
| LightStream | 7.44% | 25.79% |
| Prosper | 8.99% | 35.99% |
| OneMain Financial | 18.00% | 35.99% |
| Upstart | 7.40% | 35.99% |
| Wells Fargo | 6.99% | 24.49% |
| Zable | 12.95% | 30.00% |
Factors Affecting Personal Loan Interest Rates
Several factors determine the interest rates on personal loans. These include:
- Creditworthiness: The higher your credit score, the lower the rate you’ll likely receive.
- Income & Financial Stability: Lenders may offer better rates to borrowers with a stable income and low debt-to-income ratio.
- Loan Amount & Term: Larger loans or longer terms may attract higher rates due to increased risk.
- Lender’s Policies & Market Conditions: Rates also depend on the lender’s policies and external factors, such as the cost of funds and economic conditions.
Will Personal Loan Rates Continue to Fall in 2025?
The Federal Reserve’s actions in 2025, such as reducing the fed funds rate, could lead to lower personal loan rates. However, lenders’ decisions might vary, and other factors like loan delinquency rates could offset any reductions in interest rates. Personal loan rates are typically fixed, meaning that once you lock in a rate, it will remain the same throughout the loan term.
If you’re considering a personal loan, it’s always a good idea to shop around. Even a small difference in the interest rate can lead to significant savings over the life of the loan.
Common Uses for Personal Loans
Personal loans are commonly used for:
- Debt consolidation
- Home improvements
- Medical expenses
- Large purchases
- Wedding expenses
In a survey commissioned by Investopedia, debt consolidation emerged as the most common reason for borrowing, followed by home improvements.
Where to Get a Personal Loan
Personal loans are available from a variety of sources, including:
- Banks
- Credit Unions
- Online Lenders
Many lenders provide rate quotes based on your credit score and loan details through a quick, soft credit check.
Which Personal Loan Is Easiest to Get Approved For?
Secured personal loans, such as those backed by collateral like a car or paycheck, are generally easier to qualify for. However, they tend to come with much higher interest rates and may be considered predatory, especially for borrowers with poor credit.
Conclusion
While the average personal loan rate is 25.85%, the rate you receive can vary significantly based on your credit profile and the lender’s terms. Shopping around for the best rate and considering your financial situation can help you secure the most favorable loan conditions.
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