Best Personal Loan Rates This Week, August 5, 2025: 3-Year Dips While 5-Year Continues to Rise

Personal loan rates moved in opposite directions this week. The average APR for a 3-year loan slipped to 13.66%, offering a bit of relief for short-term borrowers. Meanwhile, 5-year rates continued to climb, rising to 19.70%.

The Fed wrapped up its latest meeting last week and, as expected, chose to keep interest rates steady. Still, lenders are making their own moves as economic uncertainty lingers. If you're thinking about borrowing, now may be a smart time to compare offers.

Below, we've highlighted the best personal loan rates available this week.

Weekly rate trends

Personal loan rates headed in opposite directions this week. The average APR for 3-year loans dipped slightly, offering a bit of relief for short-term borrowers, while 5-year rates rose again.

The Federal Reserve kept the federal funds rate unchanged at its meeting last week, but ongoing uncertainty continues to shape lender decisions. Borrowers with excellent credit still have access to some of the most competitive offers -- often below 9% -- particularly on shorter-term loans. Looking ahead, markets are watching closely for any signs of a rate cut later this year.

Average personal loan interest rates

Here's a quick look at the average personal loan rates this week.

How to compare personal loan rates

Before you apply for a personal loan, it's important to know what affects your rate -- and where you might be able to save.

• Start with your credit score. Lenders rely heavily on it to set your rate. A score above 700 usually unlocks the lowest APRs, but even with a lower score, you could still qualify -- just be prepared for less favorable terms.
• Look at the APR, not just the interest rate. The annual percentage rate includes both the interest and any upfront fees, giving you a more accurate sense of the total cost. Sometimes, a loan with a higher rate but no fees ends up being cheaper overall.
• Take advantage of rate discounts. Many lenders offer lower rates if you set up automatic payments or have an existing account with them. These small perks can add up over the life of the loan.
• Shop around without hurting your credit. Prequalifying with a soft credit check lets you compare loan offers without affecting your score -- so you can find the best rate before you commit.

When a personal loan might be the right move

Used wisely, a personal loan can be a flexible way to manage major costs. Here are a few common reasons borrowers take one out:

• Debt consolidation. Rolling multiple credit card balances into one fixed-rate loan can simplify monthly payments and reduce interest charges.
• Unexpected expenses. Personal loans can be a fast solution for emergencies -- like medical bills, car repairs, or last-minute travel -- often providing funds within 24 hours.
• Big purchases or projects. Whether you're renovating your home, planning a wedding, or relocating, personal loans offer predictable payments and a clear payoff schedule.

Our top pick this week: Upstart

Upstart is our top pick this week for its fast funding, wide loan range, and flexibility to pay off your loan early with no prepayment penalties. While it does charge an origination fee, qualified applicants can score lower rates than many traditional lenders offer -- making it a standout option right now.

Check your rate with Upstart -- there's no impact to your credit score, and you could get your funds in as little as one business day.

Bottom line

Personal loan rates took different paths this week, with the average 3-year rate dipping slightly while the 5-year rate rose. With no change to the federal funds rate yet this year, fluctuations will likely continue to be influenced by short-term economic changes. If you're thinking about applying, locking in a fixed rate now might help you avoid further increases in longer-term loans -- especially if your credit is in good shape.

Check out the top personal loan offers available this week to find one that fits your goals and your budget.