Signature Loan Rates | CitrusNorth
Borrowers with high income, good credit, and low debt will get the best signature loan rates. Compare personal loan rates to get the best deal.
The interest rates on personal loans range from 3.99% to 35.99%. Your credit score, credit history, income, and whether you borrow from a bank or credit union will all impact the interest rate on your loan.
Compare personal loan rates, monthly payments, and total interest to help you find the best loan. Below are the best personal loans interest rates available from banks, credit unions, and online lenders.
How do lenders determine signature loan rates?
Lenders use your credit score to determine your rate. But it is not the only factor. Personal loan applications are also evaluated based on income, credit history, and existing debts.
Lenders may also request additional information such as where you were born, where you work, and where you reside. To determine your rate, a lender might also consider the amount of the loan you request and the reason for borrowing.
How to get the lowest signature loan rates
Personal loan rates that are the best usually go to those with good credit and stable income. They also have to show consistent on-time payments towards credit cards and other loans.
Here are some ways to get a personal loan at a lower rate if you feel you might not be eligible:
- Before you apply, make sure to review your credit report. Check your credit report to determine if you have low credit scores. A past-due account, for example, could cause a lender to refuse you approval or give you a higher rate.
- You can adjust your loan amount and repayment term. A lender may ask for a more significant loan amount or a longer repayment term.
- Get rate discounts. There are many reasons why lenders offer discounts. Online lenders often offer rate discounts when setting up automatic payments. Existing customers with certain bank accounts may be eligible for rate discounts.
- Look for a lender that charges no fees. The APR does not include fees that a lender adds to the loan, such as an origination fee. You can avoid paying high-interest rates if you choose a lender who doesn’t charge an origination fee.
- You can add a cosigner, co-borrower, or collateral. A lower rate may be available to borrowers with poor credit ratings, including someone with better credit and higher income. A vehicle or CD account may be collateral to help you secure a personal loan at a lower interest rate. You should be aware that default can have serious consequences.
You can pre-qualify online for a personal loan from many online lenders, banks, and credit unions. You will need to provide information about your credit, income, and employment. The lender will then tell you how much, what rate, and how long you can borrow.
Pre-qualifying triggers soft credit pulls. You can do this as many times as you wish without having to affect your credit score. Only if you submit your complete application after pre-qualifying, a tough credit draw will occur.
Average signature loan rates online based on credit score
Personal loan rates are not subject to fluctuation like mortgage rates. Lenders may occasionally update their rates or credit requirements. However, these changes are usually only a few tenths to a percentage point.
The Online lender rate varies based on the type of borrower they are targeting. An online lender that targets bad credit may offer higher rates than one who is good credit. Online lenders are faster than banks and credit unions and allow borrowers to prequalify. Many lenders offer an online application and a mobile app for managing the loan.
Rates for exceptional credit
According to CitrusNorth data, the monthly average low rates excellent credit borrowers received in 2020 ranged from 10.7% to 12.4%. These numbers were derived from data provided by users who pre-qualified.
The best rates will be offered to those with a high income which have made regular payments to creditors. Lenders who approve borrowers within this credit range may provide you with special perks such as rate discounts or zero fees.
CitrusNorth user data shows that the monthly average low rates personal loan borrowers with good credit received in 2020 ranged from 15.5% to 19%. Borrowers with low debt, high income and a history of good credit are likely to receive the lowest rates in this credit range.
Fair credit rates
CitrusNorth users pre-qualified with good credit had the lowest rates, ranging from 21% to 25% in any month of 2020. A co-signer, or joint borrower, with higher credit scores and a higher income can help you get a lower rate.
Rates for poor credit
Rates for bad-credit borrowers are at the high end APR range of lenders. CitrusNorth users who were pre-qualified for this credit band in 2020 had rates that ranged from 26.7% up to 32.4% per month. Although those with low scores might not be eligible, requesting a smaller loan amount or adding a cosigner could increase your chances of funding.
Banks offer personal loans at low rates
Although banks may offer lower rates and discounts for customers already, they have stricter eligibility requirements and take longer to fund loans than online lenders. According to the Federal Reserve’s most recent data, the average rate banks charged for a 2-year loan in February 2021 was 9.46%.
Credit unions offer personal loans at low rates
Credit union loans can have lower rates than online lenders and banks for those with bad or fair credit. Loan officers might also be more open to taking into account your financial situation.
According to the National Credit Union Administration, the average rate credit unions charged for a three-year fixed-rate loan of 8.86% in March 2021 was 8.86%. The APR for personal loans is 18% in federal credit unions.
To apply for a loan, you must be a member of a credit cooperative. This may require paying fees or fulfilling specific eligibility requirements.
What is the difference between interest rate and APR?
The APR of a loan includes both the interest rate and all fees. An origination fee charged by a lender, for instance, would be included in the annual percentage rate.
Refinance a personal loan for a lower interest rate
Refinancing personal loans may help you lock in a lower interest rate, especially if your credit rating has improved or your debts have decreased since your first loan. Refinances from different lenders are possible with some lenders. Others will allow you to refinance an existing personal loan.
Be aware of the term of any refinance. Even with a lower interest rate, a longer repayment term could lead to higher overall interest.
CitrusNorth reviews personal loans from over 30 lenders and rates them. We interviewed representatives from the companies and collected more than 45 data points. CitrusNorth editors and writers conduct an annual fact check and update and make any updates throughout the year.
Our star ratings award lenders that provide consumer-friendly features points. These include flexible payment options, quick funding times, customer service, reporting to credit bureaus, financial education, transparent rates and terms, low-interest rates with no fees, and easy pre-qualification.
We also take into account regulatory actions taken by agencies such as the Consumer Financial Protection Bureau. These factors are weighted based on how they affect consumers’ experience and which are most important.
This applies only to lenders who have a maximum interest rate of 36%. That is the rate that most financial experts and consumer advocates consider affordable. CitrusNorth is not compensated for its star ratings.
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