Take Out a Personal Loan That Doesn’t Empty Your Wallet
Best Low-Interest Personal Loans of 2024
Best Overall
Upstart
On Credible’s Website
Recommended Credit Score
300
APR Range
7.8% to 35.99%
Loan Amounts
$1,000 to $50,000
Term Length
3 to 5 years
Why We Chose It
Upstart doesn’t just offer low-interest personal loans to people with excellent credit: It also offers the best low interest personal loans for bad credit, only requiring a minimum credit score of 300 to apply for a loan. Upstart loans look at factors beyond your financial history, like your employment and education, to get a more thorough picture of your borrowing capabilities. Read our Upstart personal loans review.
Pros
- 15-day grace period before late fees are charged
- Fast funding
- Takes into account education and employment in loan decisions
Cons
- $10 paper copy fee
- Returned payment fee
- Must have good credit to score lowest APRs
Additional Information
Funding Speed: Next business day
Early Payoff Penalty: None
Late Fee: The greater of 5% of the monthly past due amount or $15
Origination Fee: 0% to 12%
Best for High-Value Loans
Wells Fargo
Recommended Credit Score
Not disclosed
APR Range
7.49% to 23.24%
Loan Amounts
$3,000 to $100,000
Term Length
12 months to 84 months
Why We Chose It
With the ability to borrow up to $100,000 from Wells Fargo, you’ll be set for nearly any purchase. Wells Fargo personal loan rates are competitive, and you’ll also enjoy a same-day credit decision and fast funding without origination or closing fees. Read our Wells Fargo review.
Pros
- 0.25% APR relationship discount
- No closing fee or origination fee
- Same-day credit decision
Cons
- Must have excellent credit to obtain lowest APRs
- Possible late fee
- Cashier’s check only available if you don’t have Wells Fargo checking or savings account
Additional Information
Funding Speed: One to three business days
Early Payoff Penalty: None
Late Fee: $39
Origination Fee: None
Best for No Late Fees
Happy Money
On Credible’s Website
Recommended Credit Score
640
APR Range
11.72% to 17.99%
Loan Amounts
$5,000 to $40,000
Term Length
24 months to 60 months
Why We Chose It
Happy Money offers transparent loans from credit unions and community-focused lending partners in an effort to put customers first. You won’t pay any application or late fees, and the maximum APR is significantlylower than many other lenders. Read our Happy Money personal loans review.
Pros
- No application fee
- No late fees
- Can check rate without a hard credit pull
Cons
- Origination fee
- Loans not available in MA and NV
- Takes a while to get funds
Additional Information
Funding Speed: Three to seven business days
Early Payoff Penalty: None
Late Fee: None
Origination Fee: 1.5% to 5.5%
Best for Low Maximum APR
PenFed Credit Union
On Credible’s Website
Recommended Credit Score
Not disclosed
APR Range
7.99% to 17.99%
Loan Amounts
$600 to $50,000
Term Length
12 months to 60 months
Why We Chose It
While PenFed Credit Union doesn’t offer the lowest personal loan rates, it does offer one of the lowest maximum APRs, which can be comforting if you don’t have a great credit score and know you’ll likely only qualify for loans at the top of that range. You can use your loan for nearly any purpose, all without any hidden fees. Read our PenFed Credit Union review.
Pros
- No hidden fees
- Can use loan for numerous purposes
- Can apply with co-borrower to lower rates
Cons
- Late and returned payment fees
- $50,000 loan limit applies across all PenFed loan products
- Takes five to seven business days to receive check
Additional Information
Funding Speed: One to two business days
Early Payoff Penalty: None
Late Fee: $29
Origination Fee: None
Best for Debt Consolidation
Reach Financial
APR Range
5.99% to 35.99%
Loan Amounts
$3,500 to $40,000
Term Length
24 months to 60 months
Why We Chose It
Reach Financial has one of the lowest starting personal loan rates available, but there’s a catch: you can only use your loan to consolidate debt or refinance credit card debt. The lender takes care of the heavy work for you by automatically paying your creditors directly.
Pros
- Free monthly credit score updates
- Pays creditors directly
Cons
- Can only use loan to consolidate debt or refinance credit card debt
- No co-borrowing or cosigners
- Website doesn’t offer many details
Additional Information
Funding Speed: 24 hours
Early Payoff Penalty: None
Late Fee: $15
Origination Fee: 0% to 8%
Best for Long Repayment
LightStream
On Credible’s Website
Recommended Credit Score
670
APR Range
7.49% to 25.99%
Loan Amounts
$5,000 to $100,000
Term Length
24 months to 144 months
Why We Chose It
LightStream loans have a lot going for them, including extremely long repayment terms, high loan amounts and low starting APRs. There’s even a Rate Beat program that will beat any other lender’s APRs by 0.10% if you meet certain requirements. Read our LightStream personal loans review.
Pros
- 0.50% APR autopay discount
- Long repayment terms
- Rate Beat program provides 0.10% lower APR than other lenders
Cons
- Requires good to excellent credit
- Can’t change payment due dates
- Can’t use loan for education
Additional Information
Funding Speed: Same day
Early Payoff Penalty: None
Late Fee: None
Origination Fee: None
Best Big Bank Loan
Discover
On Credible’s Website
Recommended Credit Score
660+
APR Range
7.99% to 24.99%
Loan Amounts
$2,500 to $40,000
Term Length
36 months to 84 months
Why We Chose It
Discover personal loans deliver with fast funding and flexible term lengths. It can even pay off your creditors directly so you don’t have to deal with the hassle of cashing a check and forwarding payment to another company. Read our Discover personal loans review.
Pros
- Can pay off creditors directly
- Free FICO Score access
- Fast funding
Cons
- Must have at least $25,000 of annual income
- Co-borrowing not permitted
- Requires income verification
Additional Information
Funding Speed: Next business day
Early Payoff Penalty: None
Late Fee: $39
Origination Fee: None
Best Multi-Purpose Loan
TD Bank
Recommended Credit Score
Not disclosed
APR Range
8.99% to 23.99%
Loan Amounts
$2,000 to $50,000
Term Length
36 months to 60 months
Why We Chose It
TD Bank barely has any limits on what you can use your loan for, giving you freedom with no application fees and fast funding. There are also no prepayment fees, so you can pay off your loan early without any repercussions. Read our TD Bank review.
Pros
- No application fee
- Fast funding
- Can use loan for wide range of purposes
Cons
- Only available in 15 states and Washington, D.C.
- No Sunday customer service
- Can’t use loans for business or education expenses
Additional Information
Funding Speed: One business day
Early Payoff Penalty: None
Late Fee: The lesser of 5% of payment due or $10
Origination Fee: None
What Is a Low-Interest Personal Loan?
A low interest personal loan is an installment loan that offers lower-than-average interest rates. Like other personal loans, you’ll borrow a lump sum of cash and then repay it over a set period. When you take out your loan, you’ll sign an agreement with a fixed interest rate, meaning your payments will be predictable every month.
Personal loans with low interest rates can save you a lot of money, as you’ll be paying less in interest. But to get the lowest personal loan rates, you’ll typically need to have a high credit score. You can still get a low-interest personal loan with bad credit, but you’ll likely need to find a lender that looks at other factors beyond your credit score, which can include education and employment history.
What Is Considered a Good Interest Rate On a Personal Loan?
According to the Federal Reserve, as of November 2023, the average 24-month personal loan rate in the United States was 12.35% APR, so any loan with an interest below that amount can qualify as a low-interest loan. Loans under 10% are typically a good rate, and anything under 8% is great. These types of rates are generally reserved for customers with excellent credit, so do whatever you can to raise your credit score before you apply for a loan to increase your chances of a lower rate.
How Do You Compare Low-Interest Personal Loans?
We recommend comparing APRs from three to five lenders to make sure you’re getting the best deal. Most lenders provide an APR range for their low-interest personal loans. But this range is often broad and unhelpful, especially if your credit score isn’t perfect. Some lenders might tease an extremely low APR at the bottom of the range but then have a max APR that exceeds 30%.
Knowing where you fall in that range can be tricky, so if possible, try to check your loan rate directly with the lender. Most only require a soft credit check at this step, so checking your rate typically doesn’t hurt your credit score. You’ll likely need to provide your name and other personal identifying information so the bank can verify who you are.
Once you’ve received a more personalized loan APR, play around with terms and loan amounts. Sometimes, increasing the repayment term or lowering the amount you borrow can change the APR. Collect all of the APRs, terms and loan amounts for each lender into a spreadsheet so you can easily sort by which lender is offering the best loan for your needs.
How to Choose the Best Low-Interest Personal Loan
When looking for the best low interest rate personal loans, you have to consider more than just low APR. Here are some additional factors to think about to find a personal loan that meets all of your needs.
Fees
Banks and lenders might charge you many fees to take out a loan. One common one is an origination fee, which is usually a percentage of the total loan amount that you pay when you get your loan. Some lenders also charge a late fee if you fall behind on your payments. Luckily, none of the lenders we’ve selected here charge a prepayment fee, but others might. This is a charge you might have if you pay off your loan early.
Autopay Discounts
Banks like autopay because it means there’s less of a chance you forget to make a payment. Because of that, some offer you a discount on your APR when you set up autopay. Though this is typically a small amount, like 0.25% or 0.50%, it can end up saving you a lot in the big picture. Consider a $5,000, five-year loan with a 9.50% interest rate. You’d save over $73 in interest over the life of the loan with a 0.50% APR discount.
Repayment Terms
You need to make sure you choose a loan that gives you enough time to make repayments. If a lender only offers short terms, you might find the monthly payment isn’t affordable for you. Longer terms lower your monthly payment and can make it easier to afford. Just keep in mind, the longer your term, the more you’ll pay in interest over the life of the loan.
Customer Service
Hopefully, nothing will ever go wrong with your loan or payments. But if it does, you want a lender that has easily accessible and friendly customer service. Check the company’s customer service hours, as well as the ways you can reach them if you have questions. At a minimum, a lender should have a phone number where you can reach a live person, but live chat and email support tickets are also helpful.
Lender Reputation
Lender reputation is important to consider before nailing down the best personal loan for you. Look into online reviews to make sure the lender isn’t shady or unreliable. For example, see if any customers have had problems with extra fees, making payments or speaking with customer service. You might also check websites like the Better Business Bureau to see if there are any outstanding complaints against a bank.
Low-Interest Personal Loan Alternatives
Not everyone qualifies for personal loans with low interest rates—and even if you do, you may not want to be locked into a fixed monthly payment for years. Luckily, there are other options to consider that provide slightly more flexibility. Here are some alternatives to low interest personal loans that might be a better fit for your situation.
Low-Interest Personal Loan vs. 0% Interest Credit Card
A 0% interest credit card gives you a specified intro period where you don’t pay interest on purchases or balance transfers. It can be a great choice if you’re struggling with existing credit card debt. You might also choose it over a low interest personal loan if you just need a few hundred or thousand dollars of capital, don’t meet minimum loan requirements and know you’ll be able to pay off your debt before the intro period is over.
Low-Interest Personal Loan vs. Buy Now, Pay Later
With buy now, pay later, you have the ability to pay for purchases over time with set installment payments. Typically, you’ll pay around 25% of the purchase upfront and make three additional payments to pay off the balance. Buy now, pay later makes the most sense for someone who needs to break a large purchase down into smaller payments to make it more affordable.
Low-Interest Personal Loan vs. Home Equity Loan
If you’re a homeowner, you may be able to cash out some of the equity you’ve built up in your property by taking out a home equity loan. Also called a second mortgage, it allows you to use your house as collateral. Because you’ll be putting your home at risk, this type of loan is best for purposes that will save or earn you money, like paying off high-interest debt or completing a home improvement project.
Low-Interest Personal Loan vs. Family Loan
If you’re lucky enough to have friends or family in a comfortable financial position, you might ask them to loan you some money instead of taking out a loan from a bank. It’s important to treat this like a real loan, so come up with set terms and a repayment schedule that you have notarized. Even if your family member wants to charge you interest, it’ll still likely be cheaper than what a bank charges you.
Frequently Asked Questions
What Is the Least Expensive Way to Borrow Money?
The least expensive way to borrow money is to get a no-interest loan from family or friends. You might also consider opening up a 0% APR credit card, which often gives you several months to make purchases without paying interest. Just keep in mind that after this intro period is over, interest will start to accrue on any remaining balance.
Which Bank Is Offering the Lowest Personal Loan Interest Rate?
Currently, Reach Financial is offering the lowest personal loan interest rate, with APRs starting at 5.99%. But these APRs are reserved for customers with excellent credit profiles. Other banks with low starting APRs include Wells Fargo and LightStream. They both offer APRs starting at 7.49%.
Is There a 0% Personal Loan?
Interest-free personal loans do exist, but they come with strict guidelines and requirements. For example, most 0% loans only offer an intro period with no interest; after that, they charge a high APR. You may also have to pay hefty origination fees to get these types of loans. Some examples of 0% personal loans include retail loans, car loans and buy now, pay later programs.
