Monthly payment · Total interest · APR breakdown · Compare terms
| Term | Monthly | Total Interest | Total Cost |
|---|
| Credit Score | Score Range | Typical APR | Rating |
|---|---|---|---|
| Exceptional | 800+ | 7% – 11% | Excellent |
| Very Good | 740–799 | 11% – 15% | Good |
| Good | 670–739 | 15% – 22% | Average |
| Fair | 580–669 | 22% – 30% | High |
| Poor | Below 580 | 30% – 36%+ | Very High |
Rates are indicative averages. Actual rates vary by lender, loan amount, term, and financial profile.
Debt consolidation is one of the most common reasons people take out a personal loan, but it only makes sense under certain conditions — otherwise it just moves the debt around without saving anything.
When it helps. If you're carrying credit card balances at 22%–29% APR and you qualify for a personal loan at 12%–16% APR, consolidating can cut your interest cost substantially and gives you one fixed payment instead of several revolving balances. Because personal loans amortize on a fixed schedule, you also get a guaranteed payoff date — something a revolving credit card balance never gives you.
When it doesn't. If your new loan's APR is close to or higher than your existing debt (common for fair/poor credit applicants), or if the origination fee eats most of the interest savings, consolidation just adds cost without benefit. Run the numbers both ways: total interest on your current debts left as-is versus total cost of the new loan (including any origination fee) before committing.
The behavioral risk. The most common way debt consolidation backfires isn't math — it's behavior. Paying off credit cards with a personal loan frees up that credit limit, and re-charging those cards while also repaying the consolidation loan leaves you servicing two debts instead of one. Consolidation only works if the freed-up credit lines stay unused (or get closed/frozen) until the loan is paid off.
The interest rate is the base cost of borrowing the principal. APR (Annual Percentage Rate) includes the interest rate plus any fees (origination fee, prepayment penalties, etc.), making it the true annual cost of the loan. Always compare APRs — not just rates — when shopping lenders.
Most prime lenders require a credit score of 660+ for competitive rates. Excellent credit (750+) typically unlocks rates of 7–12% APR. Fair credit (580–659) may still qualify but expect 20–30% APR. Below 580, consider credit-builder loans or secured alternatives.
An origination fee is a one-time charge (typically 1–8% of the loan) deducted from your disbursement. On a $10,000 loan with a 5% origination fee, you receive $9,500 but repay the full $10,000 plus interest. This is why APR is higher than the stated interest rate — it factors in this fee.
Many online lenders (SoFi, LightStream, Marcus) have no prepayment penalty. Traditional banks and some credit unions may charge 1–3% of the remaining balance. Always read the loan agreement before signing. Early payoff saves significant interest — use the extra payment field above to see how much.
As of 2025, average personal loan APRs range from 11–28% depending on credit score and lender. Excellent credit: 8–13%. Good credit (690–719): 14–20%. Fair credit: 20–30%. Banks and credit unions often offer lower rates than online lenders, but have stricter approval requirements.