Financing emergencies, home renovations, vacations, or other large expenses on credit cards can add up. The average credit card interest rate as of February 2024 was 21.59%, according to the Federal Reserve. Rates on two-year personal loans, on the other hand, averaged 12.49%, making a low-interest loan a comparatively affordable alternative. And the lower the rate, the potentially higher the savings. This is why rate-shopping personal loans is crucial.
Compare low-interest personal loan rates of May 2024
Advertiser DisclosureOverview
Lightstream is one of three Credible partner lenders to offer loan amounts up to $100,000, which makes it ideal for financing large expenses like home improvements or weddings. Funds are available as soon as the same day you apply, and you'll have up to 12 years to repay certain types of loans, including home improvement loans, RV loans, and boat loans. There are no origination fees, and rates are low — Lightstream's lowest APR beats SoFi's advertised lowest APR by 1 percentage point. But you'll need good credit to qualify.
Unlike most lenders, Lightstream does not let you prequalify on its site. Nor does it provide a contact phone number next to its customer service hours on its website.
Repayment terms
2 - 12 years, depending on loan purpose
Eligibility
Available in all states except RI and VT
Time to get funds
As soon as the next business day
Loan uses
Credit card refinancing, debt consolidation, home improvement, and other purposes
Read full reviewOverview
Upstart has one of the lowest available APRs of Credible partner lenders and of all non-partners we reviewed, making it a good choice for well-qualified applicants. However, it's also is one of few lenders that doesn't have a minimum credit score requirement (if you apply on the lender's website), which makes it an option if you have bad credit or no credit history. Upstart may charge an origination fee as high as 12%, but good-credit borrowers may not be charged one at all.
Trustpilot gives Upstart 4.9 stars, which is the highest of all lenders we reviewed.
Time to get funds
As soon as 1 to 3 business days
Loan uses
Pay off credit cards, consolidate debt, relocate, make a large purchase, and other purposes
Read full reviewOverview
Discover Personal Loans offers low APRs, repayment terms up to seven years, no origination fees, nationwide availability, and doesn't require your Social Security number to prequalify on its site. You'll need to have an annual income of at least $40,000, and a FICO score 660 or higher, to be eligible. If your credit score is fair or poor, you'll need to go elsewhere, as Discover doesn't allow cosigners.
Funds are available as soon as the next business day after loan approval.
Eligibility
Available in all 50 states
Time to get funds
Funds can be sent as soon as the next business day after acceptance
Loan uses
Auto repair, credit card refinancing, debt consolidation, home remodel or repair, major purchase, medical expenses, taxes, vacation, and wedding
Read full reviewOverview
Upgrade has a suite of features that make it a very attractive lender: competitive interest rates, discounts for direct pay and autopay, as soon as same-day funding, up to seven-year repayment terms, and nationwide availability. Plus, loans are available to fair-credit borrowers, and you don't need to input your Social Security number to prequalify on the website. Upgrade even offers secured personal loans, which is not common among lenders.
However, Upgrade does charge an origination fee of 1.85% to 9.99%. You must have a FICO score of at least 600 and a minimum income of $25,000 annually to qualify.
Loan amount
$1,000 to $50,000 ($3,005 minimum in GA; $6,600 minimum in MA)
Loan uses
Credit card refinancing, debt consolidation, home improvement, major purchase, other
Read full reviewOverview
SoFi stands out for offering no-fee personal loans with competitive rates, high loan amounts, long loan terms, discounts for autopay and direct pay, and funding as soon as the same day. Plus, SoFi prioritizes convenience for existing and potential customers with features like live chat and an easy prequalification process that doesn't require your Social Security number.
The main catch is that you need to qualify for a loan with SoFi, which can be hard to do if you don't have good credit. You also won't be able to apply with a cosigner, since SoFi doesn't accept cosigners; nor does it offer secured personal loans.
Fees
Option to pay an origination fee (up to 6%) in exchange for a lower rate
Time to get funds
Typically within a few days, given approval and bank account verification, but sometimes within the same day
Loan uses
Solely for personal, family, or household uses
Read full reviewOverview
Best Egg is a solid lender for a wide range of borrowers and, notably, scored second for personal loan satisfaction in J.D. Power's Consumer Lending Study. It offers competitive rates, reasonable loan terms and amounts, and personal loans for fair credit. You'll need a FICO score of at least 600 to qualify, but the lower your score, the higher your APR may be. The APR includes the interest rate and origination fees, which range from 0.99% to 8.99% with Best Egg.
Note that if you successfully prequalify with Best Egg, you may be more likely to be approved for the loan relative to other lenders you prequalify with. Based on Credible data, borrowers who chose to apply for a loan with Best Egg were more than twice as likely to be approved (relative to most other Credible partners).
Fees
Origination fee, late fee, unsuccessful payment fee, check processing fee
Eligibility
Available in all states except DC, IA, VT, and WV
Time to get funds
As soon as 1 to 3 business days after successful verification
Loan uses
Credit card refinancing, debt consolidation, home improvement, and other purposes
Read full reviewOverview
Zable offers relatively small loan amounts — ranging from $1,000 to $25,000 — that can be deposited in your account as soon as the same day you are approved, if it is by the lender's deadline. It’s an option for fair-credit borrowers, with a minimum credit score of 600, as well as those with lower incomes.
Its origination fees range from 5% to 9%, however, and it does not offer discounts, secured loans, nor the option to add a cosigner to your application. Zable also currently does not offer loans in 21 states.
Fees
Origination fees (5% to 9%)
Eligibility
Not available in CO, CT, IN, KS, LA, ME, ND, NE, NH, NJ, NV, OK, OR, PA, RI, SC, SD, VT, WV, WI, or WY
Loan uses
Debt consolidation, credit card refinancing, home improvement, major purchase, car financing
Read full reviewBest low-interest personal loans
The top factor in our selection of the best low-interest loans is the annual percentage rate (APR). This number accounts for both the interest rate on the loan and any upfront costs, like an origination fee. That's why it's better to use when comparing borrowing costs than the interest rate alone.
But APR isn't the only thing we considered. We also looked at available loan amounts, time to fund, repayment term options, other fees, credit and income requirements, customer access, lender reputation and consumer reviews, plus other features to determine the best low-interest personal loans of 2024.
Upstart: Best fast personal loans for all credit types
Best fast personal loans for all credit types
Loan Amount
$1000 to $50000
May fund in 1 business day
No minimum credit score requirement on lender site
Low minimum APR
Trustpilot score of 4.9/5 stars
May charge a high origination fee
No discounts offered
Overview
Upstart has one of the lowest available APRs of Credible partner lenders and of all non-partners we reviewed, making it a good choice for well-qualified applicants. However, it's also is one of few lenders that doesn't have a minimum credit score requirement (if you apply on the lender's website), which makes it an option if you have bad credit or no credit history. Upstart may charge an origination fee as high as 12%, but good-credit borrowers may not be charged one at all.
Trustpilot gives Upstart 4.9 stars, which is the highest of all lenders we reviewed.
Time to get funds
As soon as 1 to 3 business days
Loan uses
Pay off credit cards, consolidate debt, relocate, make a large purchase, and other purposes
Lightstream: Best home improvement loans and low rates
Best home improvement loans and low rates
Loan Amount
$5000 to $100000
Same-day funding available
High maximum loan amount
No origination fee
Good credit required
No prequalification process
Not available in Vermont
Overview
Lightstream is one of three Credible partner lenders to offer loan amounts up to $100,000, which makes it ideal for financing large expenses like home improvements or weddings. Funds are available as soon as the same day you apply, and you'll have up to 12 years to repay certain types of loans, including home improvement loans, RV loans, and boat loans. There are no origination fees, and rates are low — Lightstream's lowest APR beats SoFi's advertised lowest APR by 1 percentage point. But you'll need good credit to qualify.
Unlike most lenders, Lightstream does not let you prequalify on its site. Nor does it provide a contact phone number next to its customer service hours on its website.
Repayment terms
2 - 12 years, depending on loan purpose
Eligibility
Available in all states except RI and VT
Time to get funds
As soon as the next business day
Loan uses
Credit card refinancing, debt consolidation, home improvement, and other purposes
Discover: Best for no origination fees (and low rates)
Best for no origination fees (and low rates)
Loan Amount
$2500 to $40000
Low minimum APR
May fund the next business day
Long loan terms available
Direct pay to creditors
No origination fee
No discounts offered
Secured loans not available
Overview
Discover Personal Loans offers low APRs, repayment terms up to seven years, no origination fees, nationwide availability, and doesn't require your Social Security number to prequalify on its site. You'll need to have an annual income of at least $40,000, and a FICO score 660 or higher, to be eligible. If your credit score is fair or poor, you'll need to go elsewhere, as Discover doesn't allow cosigners.
Funds are available as soon as the next business day after loan approval.
Eligibility
Available in all 50 states
Time to get funds
Funds can be sent as soon as the next business day after acceptance
Loan uses
Auto repair, credit card refinancing, debt consolidation, home remodel or repair, major purchase, medical expenses, taxes, vacation, and wedding
Zable: Best for short-term loans and same day funding
Best for short-term loans and same day funding
Loan Amount
$1000 to $35000
Funding as soon as the same day
Low minimum income required
100% digital process
No discounts
Maximum loan amount is lower than most other lenders
Origination fee
Not available in CO, CT, IN, KS, LA, ME, ND, NE, NH, NJ, NV, OK, OR, PA, RI, SC, SD, VT, WV, WI, or WY
Overview
Zable offers relatively small loan amounts — ranging from $1,000 to $25,000 — that can be deposited in your account as soon as the same day you are approved, if it is by the lender's deadline. It’s an option for fair-credit borrowers, with a minimum credit score of 600, as well as those with lower incomes.
Its origination fees range from 5% to 9%, however, and it does not offer discounts, secured loans, nor the option to add a cosigner to your application. Zable also currently does not offer loans in 21 states.
Fees
Origination fees (5% to 9%)
Eligibility
Not available in CO, CT, IN, KS, LA, ME, ND, NE, NH, NJ, NV, OK, OR, PA, RI, SC, SD, VT, WV, WI, or WY
Loan uses
Debt consolidation, credit card refinancing, home improvement, major purchase, car financing
Upgrade: Best for fair credit
Loan Amount
$1000 to $50000
Fair credit borrowers eligible
Autopay and direct pay discounts
Can fund in as little as 1 business day
Mobile app
Secured loans available
High maximum origination fee
Cosigners not accepted on home improvement loans
Low J.D. Power ranking
Overview
Upgrade has a suite of features that make it a very attractive lender: competitive interest rates, discounts for direct pay and autopay, as soon as same-day funding, up to seven-year repayment terms, and nationwide availability. Plus, loans are available to fair-credit borrowers, and you don't need to input your Social Security number to prequalify on the website. Upgrade even offers secured personal loans, which is not common among lenders.
However, Upgrade does charge an origination fee of 1.85% to 9.99%. You must have a FICO score of at least 600 and a minimum income of $25,000 annually to qualify.
Loan amount
$1,000 to $50,000 ($3,005 minimum in GA; $6,600 minimum in MA)
Loan uses
Credit card refinancing, debt consolidation, home improvement, major purchase, other
Loan Amount
$5000 to $100000
Min. Credit Score
Does not disclose
No fees required
Large loan amounts available
Autopay and direct pay discounts
Same day funding
Long loan terms available
Good credit required
5,000 minimum loan amount
Overview
SoFi stands out for offering no-fee personal loans with competitive rates, high loan amounts, long loan terms, discounts for autopay and direct pay, and funding as soon as the same day. Plus, SoFi prioritizes convenience for existing and potential customers with features like live chat and an easy prequalification process that doesn't require your Social Security number.
The main catch is that you need to qualify for a loan with SoFi, which can be hard to do if you don't have good credit. You also won't be able to apply with a cosigner, since SoFi doesn't accept cosigners; nor does it offer secured personal loans.
Fees
Option to pay an origination fee (up to 6%) in exchange for a lower rate
Time to get funds
Typically within a few days, given approval and bank account verification, but sometimes within the same day
Loan uses
Solely for personal, family, or household uses
Best Egg: Best for high close rates if pre-approved
Best for high close rates if pre-approved
Loan Amount
$2000 to $50000
Secured loans available
Low minimum income requirement
Scored second in J.D. Power's Consumer Lending Satisfaction Study
Funds in 1-3 business days
High close rate on loans through Credible platform
Origination fees
No discounts
Not available in DC, IA, VT, or WV
Overview
Best Egg is a solid lender for a wide range of borrowers and, notably, scored second for personal loan satisfaction in J.D. Power's Consumer Lending Study. It offers competitive rates, reasonable loan terms and amounts, and personal loans for fair credit. You'll need a FICO score of at least 600 to qualify, but the lower your score, the higher your APR may be. The APR includes the interest rate and origination fees, which range from 0.99% to 8.99% with Best Egg.
Note that if you successfully prequalify with Best Egg, you may be more likely to be approved for the loan relative to other lenders you prequalify with. Based on Credible data, borrowers who chose to apply for a loan with Best Egg were more than twice as likely to be approved (relative to most other Credible partners).
Fees
Origination fee, late fee, unsuccessful payment fee, check processing fee
Eligibility
Available in all states except DC, IA, VT, and WV
Time to get funds
As soon as 1 to 3 business days after successful verification
Loan uses
Credit card refinancing, debt consolidation, home improvement, and other purposes
Methodology
Credible evaluated the best low-interest personal loans based on a range of factors, including customer experience, minimum fixed rate, maximum loan amount, funding time, loan terms, fees, discounts, and whether cosigners are accepted. Credible’s team of experts gathered information from each lender’s website customer service department, directly from our partners, and via email support. Each data point was verified by a third party to ensure it was accurate and current.
Learn more about how Credible rates lenders by exploring our Personal Loans Lender Rating Methodology.
How to compare low-interest loans
It’s essential to consider the following when comparing low-interest personal loans:
- APR: The lower the APR, the less you’ll pay for the loan overall. A higher rate can also equal a higher monthly payment, leaving your budget strapped.
- Loan amounts: Some lenders can approve you for loans up to $100,000 or more, but remember, the higher the loan, the more you pay back over time. It’s imperative that you only borrow what you need.
- Repayment terms: Most lenders offer terms between 1 and 7 years. Choose the one that best fits your needs, as a manageable repayment schedule can help you repay your loan successfully. Check the payment amount and date to ensure you can make your payments.
- Fees: Some, but not all lenders, charge origination fees, which may be deducted upfront from the loan amount, as well as more common fees, like late fees and NSF fees.
- Cosigner option: If you have fair or bad credit and a lender allows a cosigner, you might be able to secure a lower interest rate than you would have on your own. Keep in mind that a cosigner is responsible for payments if you’re unable to pay.
- Time to fund: If you need money by a certain time, check how long it will take the lender to send funds once approved. Many lenders can fund your loan as soon as the same or next business day, while others may take as long as a week.
Learn More: APR vs. Interest Rate on Personal Loans
How does a low-interest loan work?
Personal loans with low-interest rates are like other installment loans. Once approved, you receive a lump-sum payment transferred to your checking account or, perhaps, transferred directly to your creditors in the case of debt consolidation loans. After receiving your funds, you’ll repay your loan monthly in fixed payments based on a predetermined payment schedule and interest.
Most lenders let you pay off a loan early without penalty, but check with yours to make sure before doing so.
How to qualify for low-interest loans
Here’s how you can qualify:
- Good credit score: A FICO score of 670 or higher is considered good credit, which most lenders prefer. It’s possible to secure a loan with a lower score, but your APR will likely be much higher.
- Low debt-to-income ratio: Your debt-to-income ratio (DTI) is how much you pay monthly toward debt, divided by your pretax monthly income and expressed as a percentage. The lower this is, the more likely lenders consider you to be able to repay your loan on time. Most lenders prefer a DTI of 35% or less.
- Sufficient income: The lender needs to see that you have enough income available to make monthly payments for the size of loan you want. They also prefer to see a stable source of income.
Good to know
Credit unions often offer low-interest loans, but with most, you must be a member to qualify.
Average personal loan interest rates
Depending on your credit score, and the lender you choose, you can expect the following average interest rates, based on Credible data from November 2023:
Check Out: Average Personal Loan Rates
Low-interest loans vs. no-interest loans
No-interest loans such as “buy now, pay later” apps, in-store financing, and 0% APR credit cards, may seem comparable to low-interest personal loans. And if you can pay off the balance of the loan within the no-interest timeframe, they may be a better choice.
However, once this timeline ends, or you miss a payment, you could accrue late fees and/or the standard APR may be applied to the remaining balance. The details depend on what type of financing you used. But in most cases, the loan will no longer be no-interest or even low-interest. Especially if you consider that some credit card APRs can be 30% or higher.
In contrast, low-interest loans require paying interest from the start, but there's no promotional period after which the interest rate rises. You will have a consistent monthly payment with no surprises and a set end date for paying off your loan.
Pros and cons of low-interest loans
Here are some benefits and drawbacks to consider.
Pros
- Lower payments: A low-interest loan will collect less in fees over the life of the loan, which means you pay less.
- Helps build credit: Making on-time loan payments can increase your score, as payment history makes up 35% of your FICO credit score.
- Easy to manage: Low-interest loans have a set payment schedule with a fixed amount, making it easier to budget and have money leftover for other financial goals.
Cons
- Fees: Some lenders add fees for early repayment, missed payments, applications, and origination.
- Ability to borrow too much: Getting a large lump sum at once may influence you to borrow more than you can realistically afford to pay back in the long run, leaving you worse off than before.
- Hard inquiry: Lenders will perform a hard inquiry that can ding your credit score. It’s important to note if you’re working to clean up your credit.
How to apply for a low-interest loan
Once you’ve decided to apply for a low-interest loan, here’s what you need to do:
- Research and compare lenders: Look for personal loan lenders who specialize in low-interest loans. Consider other factors for your needs such as APR, time to fund, and loan amounts.
- Prequalify: You can prequalify with most lenders to get an idea of what you might qualify for before submitting your loan application. With prequalification, a lender performs a soft credit check, which won’t harm your credit score. However, prequalification is not an offer of credit, and the rate you receive may not be the final rate you qualify for once you formally apply.
- Fill out and submit the application: Fill out your application online or in person. You’ll likely need to provide proof of income such as a W-2, a legal form of personal identification like a driver’s license, and proof of address such as a credit card statement. Once you submit your application, the lender will perform a hard credit pull, which will temporarily lower your credit score.
- Wait for approval and get your funds: Some lenders can provide your funds the same or next business day once you're approved. But you may wait a week, depending on the lender.
Compare Rates Now
Alternatives to low-interest loans
If you’re unable to qualify for a low-interest loan, consider these other options.
- 0% APR credit card: A 0% APR credit card can be easier to secure than a low-interest loan. But once the promotional period ends, the standard APR will apply, which is generally much higher than the average personal loan.
- Buy now, pay later: Some of these services allow you to split a purchase into 3-, 6-, or 12-month installments, usually with interest. Many also offer shorter plans with no interest, however, if you make a payment every two weeks (usually for a six-week period).
- In-house financing: Many companies offer in-house financing as an alternative to a low-interest loan. You can set up a payment plan with the company directly. Like credit cards, once any promotional offers end (such as 0% APR), the standard rate will resume and you’ll also have deferred interest.
Low-interest personal loans FAQ
What factors influence low-interest loan rates?
Factors that influence the rate on a low-interest loan are your credit score, income, and overall debt-to-income ratio. Lenders want to see proof that you can manage to repay your loan promptly.
Can I get a low-interest loan with bad credit?
Typically no, as you usually need good to excellent credit to qualify for a low-interest loan. However, you can boost your credit score by paying off smaller debts to lower your DTI or by reviewing your credit report and correcting any errors.
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Meet the expert:
Athena Lent
Athena Lent is a personal finance writer, and the author behind Budgeting for Dummies. She's written for The New York Times, Real Simple, and is a regular contributor for Slate's column Pay Dirt.