The average personal loan rate stood at 12.36% in Bankrate’s October 2026 survey. Borrowers with excellent credit can do far better, with rates as low as 5.96%.
That figure comes from Bankrate Monitor data, which applies to a borrower with a 700 FICO score, a $5,000 loan and a three-year term. The survey collects rates from the 10 largest banks and thrifts in the 10 largest US markets, and it assumes the borrower has no existing relationship with the institution and no automatic payments set up. For comparison, Bankrate puts the average credit card rate at close to 20%.
Where the cheapest money is
Credit unions come out cheapest. Their national average for a three-year personal loan was 10.64% in the fourth quarter of 2025, according to NCUA data, and federal credit unions are legally capped at 18%. They usually charge no fees, so the quoted rate and the APR match. Federal credit unions also offer Payday Alternative Loans, capped at 28%, for up to $2,000 over as long as 12 months.
Commercial banks averaged 12% on a three-year loan at the end of 2025. They tend to want a high credit score and a solid work history, though a loan secured by savings deposits may price better.
Online lenders span the widest range. Among lenders Bankrate features, the lowest rate is under 6% and the highest is almost 36%. The catch is the origination fee, which can reach 12% of the loan and comes out of the money before it reaches the borrower. That is why Bankrate tells readers to compare APRs, which include fees, not headline rates.
What a few points cost
Take a $15,000 loan over four years. The gap between a 15% rate and a 6% rate is only about $60 a month, but it adds up to more than $3,000 over the life of the loan. At 35%, a rate more likely for someone with bad credit, the borrower pays $232 more each month, or an extra $11,150 in total.
Bankrate’s advice for getting a lower rate is plain. Pay down other debt, since lenders look hard at debt-to-income ratios. Add a joint borrower with strong credit. Pick a shorter term, which raises the monthly payment but cuts total interest. And apply for preapproval, which uses a soft credit pull that does not hurt a score, so offers from several lenders can be compared side by side.
