Personal Loans

Where to Get Low-Interest Personal Loans

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A low interest rate on a personal loan can be one of the best ways to save on the cost of borrowing. You’ll typically need excellent credit to get a low-interest personal loan, though the requirements will vary by lender.

5 lenders that offer low-interest personal loans
What’s a good personal loan APR?
How to qualify for a low-interest loan
Beyond loan rates: What else to consider before applying

5 lenders that offer low-interest personal loans

1. Upstart
2. Prosper
3. Rocket Loans
4. Upgrade
5. Avant

1. Upstart

APR range 8.27% to 35.99%
Loan terms 36 or 60 months
Loan amount $1,000 to $50,000
Minimum credit score requirement 600


While Upstart requires a minimum credit score of 600 — tied for the second lowest among the lenders on our list — it considers other factors such as:

  • Education
  • Job history
  • Area of study

Upstart offers the lowest starting APR among the batch, but it also offers the lowest maximum loan amount, so it wouldn’t be the best option for those who need a larger loan. APR ranges and borrowing limits may vary based on your location. Of note, Upstart personal loans aren’t available in West Virginia and Iowa.

Its online loans may come with origination fees ranging from Up to 8.00% of the target amount, which is deducted from the total before you receive the funds. Loan prequalification, which won’t affect your credit score, can be completed in five minutes, and you may be able to get your funds as soon as the next business day once approved.

2. Prosper

APR range 7.95% to 35.99%
Loan terms 36 or 60 months
Loan amount $2,000 to $40,000
Minimum credit score requirement 640


Prosper’s APRs, terms and loan amounts fall somewhere in the middle, as compared to the other lenders on this list. Its minimum credit score requirement is 640, though, which is tied for the highest on our list — 40 above Avant’s minimum.

Its loans also have origination fees, which range from 2.41% - 5.00% of the loan amount. The fee is deducted from your total funds request.

Prosper provides additional guidelines for potential borrowers. Among other things:

  • You need to have a debt-to-income (DTI) ratio below 50%
  • You can’t have five or more credit inquiries within the past 6 months
  • You can’t have any bankruptcies in the past 12 months

To qualify for the lowest available rate — 7.95% — you’d need to earn an “AA” rating from the lender by demonstrating superior creditworthiness. On the other end of the spectrum, someone with an “HR” rating would get a rate of 35.99%. The system behind Prosper ratings is proprietary, but in essence it’s an estimate of expected risk for a given borrower.

Prequalification is available and won’t affect your credit score, like the other lenders on the list. Funds are generally available within five days of accepting the loan, which puts Prosper on a longer timeline than you might find with Rocket Loans or Avant.

3. Rocket Loans

APR range 7.16% to 29.99%
Loan terms 36 or 60 months
Loan amount $2,000 to $45,000
Minimum credit score requirement 640


With Rocket Loans, borrowers can get their funds as fast as the same business day, the fastest option listed here.

Loan amounts and terms are comparable to most of the other lenders, but the APR ceiling is about 6 percentage points lower than the others on our list. Origination fees range from 1.00% - 6.00%, a lower maximum than Upstart and Upgrade; like the other lenders, that amount would be taken out of the loan proceeds. Prequalification is available to potential borrowers without affecting your credit score.

The company’s minimum credit score requirement is 640, which ties for the highest with Prosper. To secure the lowest rate, you’ll need excellent credit.

4. Upgrade

APR range 6.94% to 35.97%
Loan terms 36 or 60 months
Loan amount $1,000 to $35,000
Minimum credit score requirement 620


Upgrade offers the lowest ($1,000) and highest ($35,000) lending amounts available, compared to the other lenders on this list — that makes it slightly more flexible and borrower-friendly. However, the APRs are generally on par with what you’d find from Prosper, Avant or Upstart.

These loans also have origination fees, which range from 2.90% - 8.00%, and that amount is deducted from the loan proceeds. Prequalification without affecting your credit score is available. Funds can be disbursed as quickly as one business day after approval, but borrowers may have to wait up to four business days — that’s a longer timeline than you’d find with Upstart.

Upgrade’s minimum credit score requirement is 620, tied with Upstart for the second lowest on our list. In addition to credit score, the lender looks at your credit usage and credit history.

5. Avant

APR range 9.95% to 35.99%
Loan terms 24 to 60 months
Loan amount $2,000 to $35,000
Minimum credit score requirement 580


Avant’s minimum credit score requirement is 580, 20 less than the next highest options on our list by 20. That’s a very important point as you consider which lender to choose.

Its online personal loans funding can be disbursed the next business day, which makes it one of the faster lenders listed. It also has the shortest available loan term — 24 months — so it may be a better option for those who desire a more short-term solution to their funding needs.

The minimum loan amount, which is comparatively low, may vary by state. And while Avant’s personal loans don’t advertise an origination fee, they do charge an administrative fee of Up to 4.75%.

What’s a good personal loan APR?

The average personal loan APR on a 24-month personal loan is 9.63% as of February 2020, according to the most recent Federal Reserve data.

Breaking it down by credit score, the average personal loan APR for someone with a credit score of 720 or higher is 7.63%, while the average for someone with a score of 580 to 619 is 65.70%, according to LendingTree data.

However, interest rates tend to vary based on a variety of factors other than credit score, including:

  • Income
  • Debt-to-income ratio
  • Credit history

The best way to understand your options is to use prequalification. That way, you’ll be able to see and compare what your potential terms could be from different lenders without impacting your credit score.

How to qualify for a low-interest loan

The exact qualifications for a low-interest loan will vary by lender as they each use their own systems for approval and calculating rates and terms. However, here are a few commonly considered factors:

  • Credit score: As noted, your credit score is typically one of the main factors when lenders are considering loan applications. In general, the higher your score, the better your rate, so you’ll want to have excellent credit to get the lowest APRs.
  • Debt-to-income ratio: This is calculated by dividing your monthly debt payments by your gross monthly income. It’s used to gauge applicants’ ability to repay a potential loan. The lower the DTI ratio, the better off you generally are in terms of qualifying and getting better terms.
  • Employment: To qualify for a personal loan, you’ll generally need to show proof of employment. This is used as a verification that you have some sort of income and can afford the monthly payments associated with a personal loan.
  • Payment history: Lenders generally want to see that you haven’t missed payments or defaulted on any loans in the past. The timeline considered can vary by lender, but in general, those with a history of paying their bills on time are given better rates compared to those who’ve missed payments.

Keep in mind that if you opt for a credit union personal loan, however, the requirements will generally include membership. The way credit unions weigh these common factors will likely be different than a bank.

Beyond loan rates: What else to consider before applying

Your APR is an important factor when you look at the total cost of borrowing, but it isn’t the only piece to consider. And many of the other important aspects could reside in the fine print, so you’ll need to do your research to fully understand the costs.

Here’s what else you should factor into your decision:

  • Origination fees: As discussed, these fees are typically taken out of the borrowing amount before the loan is funded. Because this can reduce the amount you receive, it’s important to track.
  • Prepayment penalties: These can be applied for borrowers who choose to pay off the loan ahead of schedule. If you plan on doing so, you’ll want to look for a lender that doesn’t charge prepayment penalties, like LendingClub or SoFi.
  • Late fees: These are common and would apply if you were to miss a payment deadline. They can range widely, however, so be sure to note the exact amount (or percentage) from each lender before making your decision. Similar to prepayment penalties, you could look for a lender, such as LightStream, that doesn’t charge late fees.
  • Loan term: The length of your loan term has a major impact on your total costs. The longer the term, the lower your monthly payments would be, but you’d be paying interest on the loan over a longer period.
  • Loan amount: The amount you choose to take out will be the amount that’s charged interest, so it’s another factor to consider. In general, it’s best to only borrow what you need.
  • Cosigning: Some lenders allow borrowers to add a cosigner. A cosigner can be a way for someone with less-than-perfect credit to access a loan by borrowing on the credit of another person.

Beyond those factors, you’ll also want to consider affordability, as well as whether alternatives may be a better option to borrowing. For example, asking for a more affordable repayment schedule for an existing debt or putting off certain purchases can help you avoid taking on debt in the first place and save you money in the long term.


To select lenders for this roundup, we used MagnifyMoney’s personal loan marketplace on March 19, 2020. We assumed the following:

  • Excellent (720-850) credit score
  • $2,500 loan amount
  • ZIP code: 10001

Lenders were chosen based on APR ranges for the excellent credit score range. Ties were broken by assessing: 1) Origination fees and 2) Flexibility of term lengths.


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