Best Personal Loan Rates This Week, Sept. 23, 2025: 3-Year Slips While 5-Year Sees a Bump After Fed Rate Cut
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Personal loan rates moved in opposite directions this week following the Fed's rate cut last week. The average APR for a 3-year loan dipped to 13.59%, while 5-year rates jumped to 20.22%.
Lenders are adjusting quickly, and not always in the same way. While the Fed's move could bring down borrowing costs over time, some rates may still rise before they settle.
If you're thinking about taking out a loan, now's a good time to shop around and see what's out there. Below, we've rounded up the best personal loan rates available this week.
Weekly rate trends
Rates went in different directions again this week -- but opposite of last. The average APR for 3-year personal loans dipped a bit, while 5-year rates crept significantly higher. The changes are worth noting if you're thinking about borrowing soon.
Borrowers with solid credit can still find offers below 11%, especially on shorter-term loans. With rates moving and the market shifting, it's a smart time to shop around and see what deals are out there.
Average personal loan interest rates
Here's a quick look at the average personal loan rates this week.
| Loan Term | Average APR | Week-Over-Week Change | Year-Over-Year Change |
|---|---|---|---|
| 3 years | 13.59% | Down from 13.89% | Down from 15.05% |
| 5 years | 20.22% | Up from 19.39% | Down from 21.78% |
How to compare personal loan rates
Finding the right personal loan means understanding how lenders set your rate -- and knowing where you can save.
- Check your credit score. It's one of the biggest factors in determining your rate. Scores above 700 usually qualify for the lowest APRs, but even if your score's lower, you may still get approved -- just with higher rates or stricter terms.
- Pay attention to the APR, not just the rate. APR includes both interest and fees, giving you a clearer sense of the loan's total cost. In some cases, a slightly higher APR with no upfront fees can be the better deal.
- Look for discounts. Some lenders reduce your rate if you set up autopay or have an account with them. These small incentives can add up over the life of your loan.
- Prequalify without hurting your credit. Many lenders let you check your estimated rate using a soft credit pull. It's a quick, risk-free way to compare offers before you commit.
When a personal loan makes sense
A personal loan can be a smart option -- if it fits your needs and you use it strategically. Here are a few common scenarios:
- Consolidating debt: Merging high-interest credit card balances into a single fixed-rate loan can simplify your finances and reduce what you pay in interest.
- Handling emergencies: From urgent car repairs to medical bills, personal loans offer fast access to funds -- sometimes within just one business day.
- Covering major expenses: Whether you're moving, remodeling your home, or planning a big event, a personal loan gives you predictable payments and a clear repayment timeline.
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.
Read our full Upstart review to learn more and check your rate -- there's no impact to your credit score, and you could get your funds in as little as one business day.
Bottom line
Rates took an opposite turn this week from where they were last week, with 3-year rates dipping and 5-year rates jumping a bit -- a good reminder that borrowing costs can shift quickly. If you're planning to take out a loan, locking in a rate sooner rather than later could help you avoid further uncertainty -- especially if you have strong credit.
Explore this week's top personal loan offers to find one that fits your needs and budget.
FAQs
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Applying may cause a small dip in your score, but a personal loan can help your credit score over time if you use it wisely.
Paying on time every month builds a positive payment history, and consolidating credit card debt with a loan can lower your credit utilization ratio, which is a big factor in your score. It can also contribute to your credit mix.
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Shorter terms generally offer lower rates but higher monthly payments. Choose based on your budget and goals.
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Anything under 12% is considered competitive in today's market, especially if there are no fees.
Our Research Expert
Brooklyn Sprunger is a full-time Content Manager and Personal Finance Writer at Motley Fool Money, where she oversees product reviews and ratings while also writing about credit cards, bank accounts, investing, auto insurance, and other personal finance topics. She has worked in financial content since 2018, including more than four years at The Motley Fool. When she’s not writing or editing, Brooklyn is likely hiking and watching the Tennessee Vols.