Personal Loan Calculator

As of 2026, US personal loan rates typically range from about 7% for excellent credit (760+) to 36% for subprime borrowers. The national average sits around 11-13% for borrowers with good credit. Rates above 20% are generally considered expensive — at that point, look at alternatives like balance transfer credit cards, HELOCs, or paying down debt before taking new debt.

The interest rate is the cost of borrowing the principal. APR (Annual Percentage Rate) includes the interest rate plus origination fees and other required loan costs, expressed as a yearly rate. For personal loans, APR is almost always higher than the interest rate because of origination fees (typically 1-8% of the loan). Compare loans by APR, not just interest rate.

Personal loans usually win for large balances ($5,000+) because they have fixed rates (often 11-15%) versus variable credit card rates (22-29%) and a fixed payoff date. The structured monthly payment also stops the temptation to add more debt. Credit cards win for small short-term balances if you can pay off within a 0% APR promotional period.

Almost always, yes — federal law prohibits prepayment penalties on most personal loans. Making extra principal payments shortens the loan and reduces total interest. Always confirm with your lender that extra payments are applied to principal rather than future scheduled payments. Some lenders default to the latter, which negates the benefit.

Yes, in several ways. The hard inquiry from applying typically drops your score 5-10 points, recovering within a few months. Adding a new account briefly lowers the average age of your credit. On the positive side, making payments on time builds credit history, and using a personal loan to pay off credit card debt lowers your credit utilization ratio — often a net positive within 6 months.

Most US personal loans run 24-84 months. Shorter terms (24-36 months) have higher monthly payments but dramatically less total interest. Longer terms (60-84 months) keep monthly payments low but you'll pay much more interest over time. The sweet spot for most borrowers is 36-48 months — long enough for affordable payments, short enough to avoid runaway interest.

Most personal loan lenders charge origination fees ranging from 1% to 8% of the loan amount. These are typically deducted from the loan proceeds (you borrow $10,000, you receive $9,500 after a 5% fee). Some lenders like SoFi, LightStream, and Discover advertise no origination fees. Always include origination fees in your APR comparison.

Yes, but expect higher rates and stricter terms. Lenders like Upstart, Avant, and OneMain Financial specialize in lower credit tiers (580-660). Rates often hit 28-36%. A secured personal loan (backed by a savings account or CD) can lower the rate substantially. If you have time, raising your credit score 20-50 points before applying often saves more than the wait costs.

A HELOC (Home Equity Line of Credit) uses your home as collateral, typically offering rates 2-5 percentage points lower than personal loans. The catch: if you default, you can lose your home. HELOCs also have variable rates, so payments can rise. Personal loans are unsecured and have fixed rates and payments. Use HELOCs for home improvements where the lower rate offsets the risk; use personal loans for everything else.

Most personal loans are general-purpose and can be used for anything except: paying for college (use a student loan), down payment on a home (most mortgage lenders prohibit this), or business expenses (use a business loan instead — better terms and tax treatment). Common uses include debt consolidation, home improvements, medical bills, weddings, and emergencies.