Yes, a 0% APR is good. A 0% APR means the borrower pays no interest, and a rate this low typically only exists for a predetermined introductory period on certain credit cards, merchant financing offers, and auto financing arrangements. For example, many credit cards have 0% interest for a limited time on purchases and/or balance transfers.
You also might find 0% interest on purchases at certain merchants. But with both store credit cards and other merchant financing offers, watch out for deferred interest. Store cards and merchants with deferred interest don't charge interest during the initial promotional period. But if you don't pay in full by the time the 0% period ends, you owe all the interest you would have accrued without the intro rate. Credit cards that aren't affiliated with stores don't use the deferred interest model, by the way.
One other way to get 0% interest is by borrowing from a friend or family member, if they're willing to agree to those terms.
It’s easy to compare personal loan rates, which is good because doing so is essential to finding the best loan offers. Personal loan rates can range all the way from 6% to 36%, and they sometimes reflect more than just interest charges. The rates advertised for personal loans are actually annual percentage rates (APRs). Technically, the difference is that APRs include both interest and fees. However, origination fees are the most common type of personal loan fee, and they’re not always factored into the APR. So it’s important to confirm you’re comparing apples to apples when comparing personal loan rates.… read full answer
The best way to compare personal loan rates is to use WalletHub’s personal loans search tool to quickly see what some of the most popular lenders offer. On the left side of the page, you can filter the results by your credit score, desired loan amount, desired loan length and location. You’ll also be able to see additional details about the loans, such as estimated fees and monthly payments.
Using the search tool will give you a general idea of what options you can pursue and what rates are available. The next step is to check for pre-qualification. WalletHub’s free pre-qualification tool will tell you which lenders are likely to approve you, plus an estimate of what your rates would be if you’re approved.
After you compare the personal loan rates you’re pre-qualified for, you’ll typically want to apply for the loan with the lowest estimated rate. However, interest rates aren’t the only factor you should consider. If you’ll have to pay a large origination fee, for example, a slightly lower rate might not be worth it (assuming that fee isn’t already factored into the APR). And if the lender doesn’t offer loans as large as the one you need, you’ll want to rule it out. While interest rates are probably the most important consideration when it comes to a personal loan, you shouldn’t base your decision on them alone.
A good interest rate on a personal loan is 2.49% to 9%. The average APR for a two-year personal loan from a bank is 9.46%, according to the Federal Reserve, and the best personal loans have APRs as low as 2.49% for the most creditworthy borrowers. The rates you get will depend heavily on your credit, income, debt and other financial factors.… read full answer
The best way to get a decent interest rate on a personal loan is to comparison shop and get pre-qualified. WalletHub’s free personal loan pre-qualification tool helps you see which lenders have a high chance of approving you, as well as what interest rates you are likely to get if approved. You can then compare your pre-qualified offers to see what a good interest rate on a personal loan is for you personally.
Good Interest Rate on a Personal Loan by Credit Level
For excellent credit: You may be able to get interest rates as low as 4% - 7%. That’s where the majority of lenders set their minimums.
For good/fair credit: You’re unlikely to get the lowest interest rates available, nor should you have to pay lenders’ maximums. Look at lenders’ credit score requirements; the higher your score is above their minimum, the better your chances of getting a lower rate.
For bad credit: You probably won’t find rates lower than 25% to 36% from a bank or online lender. But personal loans from federal credit unions are capped at 18%.
If you’re planning on consolidating debt, a good interest rate on a personal loan is one that’s significantly lower than the rates on your existing debt. But as you compare personal loan interest rates, don’t neglect other terms.
A low interest rate might not be as great as it seems if you also have to pay costly fees to go along with it. For example, many lenders charge “origination fees” of 1% to 6% of the loan amount as an extra cost for opening the loan.
Low interest rates are better than high interest rates when borrowing money, whether with a credit card or a loan. A low interest rate or APR (annual percentage rate) means you’re paying less for the privilege of borrowing over time. High interest rates are only good when you’re the lender. But that is technically what happens when you put your money in a savings account, checking account, CD or money market account. The rate at which you’ll earn interest from a bank will be indicated as a percentage, followed by “APY” (annual percentage yield).… read full answer
When it comes to credit card interest rates, lower definitely is better (assuming you won’t be paying your bill in full each month – otherwise, the APR shouldn’t matter). In general, credit card interest rates tend to be pretty high compared to the rates charged by most loans. A low-interest credit card is one offering a regular APR under 14%, which also happens to be roughly the average rate for people with excellent credit. Your credit card APR depends heavily on your personal credit standing, and you will need at least good credit to expect even an average interest rate.
Low-interest credit cards are beneficial for people who may need to carry a balance from time to time, because less interest means less opportunity to slide into unmanageable debt. Credit cards with 0% interest periods are better for specific uses, like financing a big purchase or paying off an existing debt via balance transfer, because the 0% APR period will end at some point. Many credit card companies offer 0% APR periods for new accounts, but they often give way to higher-than-average regular APRs.
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