The interest rate you’ll be offered on a personal loan depends on your profile as a borrower, including credit score, income, and more. We’re seeing APRs (annual percentage rates) for some of the best personal loans starting below 7.00%.
Fortune reviews APR ranges for personal loans from several top lenders each workday so that when you need to apply for such a loan, you can be confident you’ve selected the right one for your situation. Read on to see rates on January 12, 2026.
Personal loan rates on Monday, Jan. 12, 2026
- LightStream, with APRs as low as 6.24%
- Wells Fargo, with APRs as low as 6.74%
- American Express, with APRs as low as 6.99%
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How personal loans work
When you take out a personal loan, you’re borrowing money—typically from a bank, credit union, or online lender. You agree to a set repayment term, which often ranges from one to five years, and commit to a set monthly payment amount. Your monthly payments will go partly toward principal, which is what you borrowed, and partly to cover interest charges.
It’s possible to pay off a personal loan early, which in many situations can save you on interest that you’d pay if you kept the loan for its full term. Just know that some lenders charge a prepayment penalty, so it’s important to read the fine print when taking out a loan.
Most personal loans are unsecured, meaning they don’t require collateral. Because of this, they typically come with fairly stringent credit requirements. For the best chances of approval, applicants should have a credit score in the good to excellent range, commonly defined as a FICO Score of 670 to 850.
What you can use a personal loan for
As long as your intended use is legal, funds from a personal loan can cover almost anything. There are some exceptions—for instance, you typically cannot use a personal loan to cover a house down payment. But by and large, personal loans are an extremely flexible financial tool. Here are some common use cases where it might make sense to take out a personal loan.
Emergency loans
Life can throw you an unexpected curveball from time to time. While it’s ideal to be able to cover unanticipated expenses from an emergency fund stored in a high-yield savings account, that may not always be feasible. From car repairs to veterinary care, a personal loan might be the right option to help you bridge the gap in some situations.
Home improvement loans
The right home improvement project may bolster the value of your home, making it a wise move for the long term. If you don’t have the funds on hand to cover the project entirely out of pocket, a personal loan for home improvement could be the way to go. Or, consider a home equity line of credit (HELOC) if you prefer to borrow against the equity you’ve built up for a potentially lower rate.
Debt consolidation loans
Maybe you’re carrying a balance on a high-interest credit card, and it feels like you’re drowning in interest charges every month. Or perhaps you’ve got multiple debts you’re working to pay off, and keeping track of the different payment amounts and due dates is wearing on you. In such cases, using a personal loan to pay off your existing debts and just have one monthly payment to deal with can be a smart money move.
Frequently asked questions
What’s a good rate on a personal loan?
Based on what we’re seeing in January 2026, if you get a rate in the single digits, you’re doing pretty well. For example, if a lender offers you a personal loan at a 7.00% APR or lower, that probably means you have excellent credit and a borrowing profile that indicates you are extremely low risk.
It’s worth noting here that interest rate and APR are slightly different. Your APR will generally be slightly higher than your interest rate, as the APR factors in interest plus any applicable fees you’ll pay on the loan.
Do personal loans charge origination fees?
Some lenders do charge origination fees, which can vary pretty substantially—oftentimes between 1% and 10%. However, there are lenders that offer personal loans with no origination fees, and it’s worth paying attention to this as you shop around.
Are there personal loans for bad credit?
You’ll most likely struggle to find a personal loan if your credit score is in the “bad credit” range (which usually means a FICO Score below 580). Even with a fair credit score (usually 580 to 669 on the FICO scale) your options will be limited. Strive for at least a good score, meaning a FICO of 670 or better, to have the best chances of approval and a low rate.
